- 475 -
that the long-term promissory notes executed by IRA in favor of
the leasing companies were fully satisfied. The failure of IRA
to make a payment due on any of its long-term notes used for the
purported purchases of the equipment did not permit the
respective lessees to stop paying rent for the equipment being
leased.
IRA, as owner/investor, could not transfer the equipment
without the prior consent of O.P.M., the leasing company.
Additionally, IRA could not take any action which would result in
the imposition of a lien on the equipment without first securing
the consent of the senior lienholder.
The sale and leaseback transactions entered into by IRA were
simultaneous, prearranged, and interrelated. IRA's required out-
of-pocket cash investment in its purchase and leaseback
transactions was more than the rents to be received from the
lessees. IRA did not have a bona fide expectation that the
equipment, in which it purportedly acquired an interest, would
have any significant residual value on the relevant deferral
date.
The transactions between IRA, O.P.M., and FSC, including the
intermediaries and IRA, were simultaneous and interrelated. The
intermediaries served no valid business purpose in IRA's
transactions with FSC and O.P.M. Horizon, Pluto, Knight, and any
other intermediary were inserted into the transactions for the
Page: Previous 465 466 467 468 469 470 471 472 473 474 475 476 477 478 479 480 481 482 483 484 NextLast modified: May 25, 2011