Thomas H. Scott and Lynn D. Scott, Transferees - Page 12

                                       - 12 -                                         

          documents relating to the purchase by Mr. Scott and Ms. Scott,              
          respectively, of certain stock of AST, which did not reflect the            
          price for each such purchase.  In response, Mr. Scott advised Mr.           
          Hrynik that Mr. Scott would take responsibility for negotiating             
          that purchase price with AST.                                               
               Mr. Hrynik's review of the MSSTA transaction draft documents           
          led him to inform Mr. Scott that, because the transactions re-              
          flected in those documents were to take place simultaneously and            
          in no particular order, the Service might consider them to be one           
          transaction for tax purposes.  In response, Mr. Scott told Mr.              
          Hrynik not to spend very much time reviewing the tax consequences           
          of the MSSTA transaction because Mr. Scott had consulted with               
          AST's accountants and Mr. Scott believed that he understood the             
          tax consequences of that transaction.                                       
               On September 7, 1989, MSSTA and AST entered into an                    
          "AGREEMENT FOR PURCHASE AND SALE OF ASSETS" (asset purchase                 
          agreement) which stated that MSSTA would, inter alia, sell its              
          assets to AST for $300,000.  On or about the same date, Mr.                 
          Scott, Mr. Carter, Mr. Harrison, Mr. Hall, MSSTA, and AST agreed            
          that MSSTA would retain 45 customer accounts that were known as S           
          accounts (S accounts).  Mr. Scott estimated that the retention of           
          those accounts by MSSTA would generate approximately $10,000 a              
          month in revenues, the approximate amount that was needed each              
          month in order for MSSTA to meet its existing lease obligation              

Page:  Previous  2  3  4  5  6  7  8  9  10  11  12  13  14  15  16  17  18  19  20  21  Next

Last modified: May 25, 2011