- 501 -
Under the terms of the "limited recourse promissory note",
Cedilla Invest. was only personally liable during the times and
to the extent of the amounts referenced in Schedule B annexed
thereto. Schedule B specifically provided that the payor's
(Cedilla Invest.'s) "maximum aggregate amount" of personal
liability was zero. Further, and also under the terms of the
note, Cedilla Invest.'s only obligation with respect to payment
of the amounts due thereunder was expressly in the nature of a
"nonrecourse obligation", and the payee "shall look solely and
only to the Collateral for the payment and performance" of
Cedilla Invest.'s obligations under the note. Other than the
purchase agreements, bills of sale, and promissory notes, IRA did
not produce any other documents in connection with these
equipment leasing transactions, such as equipment appraisals,
economic forecasts, related correspondence, legal opinions, rent
payment schedules, checks (negotiated or otherwise) evidencing
payments of purchase price or rentals, and/or records
establishing the existence or actual location of the equipment at
any time during the subject leases.
OPINION
I. Leasing Transactions Generally
To be entitled to the depreciation and interest deductions,
tax credits, and losses claimed in connection with the computer
equipment sale and leaseback transactions engaged in by IRA for
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