Saba Partnership, Brunswick Corporation, Tax Matters Partnership - Page 34




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                            Otrabanda's CINS Transaction                              
              On June 25, 1990, Otrabanda's partners made capital                     
         contributions totaling $150 million.  On June 29, 1990, Otrabanda            
         invested $100 million in the IBJ CDs.  On July 18, 1990, IBJ made            
         a $435,416 interest payment to Otrabanda.  Between July 18, 1990             
         and July 27, 1990, Otrabanda earned interest of $201,562 on the              
         IBJ CDs.  On July 27, 1990, Otrabanda sold the IBJ CDs for $80               
         million in cash and 4 LIBOR notes with a present value somewhere             
         between $18,909,546 and $19,451,562.  Otrabanda sold the IBJ CDs             
         worth $100,201,562 ($100 million (principal) plus $201,562                   
         (accrued interest)) for cash and LIBOR notes worth no more than              
         $99,451,562.  The $750,000 difference between the value of the               
         IBJ CDs and the total consideration that Otrabanda received                  
         represents Otrabanda's transaction costs.                                    
              Taking into account the $435,416 interest payment that                  
         Otrabanda received on the CDs, Otrabanda walked away from its                
         $100 million investment in the IBJ CDs with no more than                     
         $99,886,978.                                                                 
              On October 11, 1990, Brunswick increased its interest in the            
         LIBOR notes held by Otrabanda by purchasing 50 percent of                    
         Bartolo's partnership interest.  On November 1, 1990, Otrabanda              
         distributed the 4 LIBOR notes to Brunswick.  On November 28,                 
         1990, Brunswick sold the 4 LIBOR notes for $17,458,827, resulting            
         in a loss to Brunswick of approximately $1,700,000.                          






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