Saba Partnership, Brunswick Corporation, Tax Matters Partnership - Page 83




                                       - 49 -                                         

         1991 attributable to SBC's sale of the remaining Norinchukin                 
         LIBOR note.  Brunswick reported a loss of $719,046 on its audited            
         and unaudited financial statements attributable to the sale of               
         the remaining Norinchukin LIBOR note.  Brunswick charged the                 
         $719,046 loss to the portion of Brunswick's Accrued Disposition              
         Costs reserve account allocated to partnership activity as part              
         of a $758,213 entry.                                                         
              Q.  Termination of Chase Private Placement Notes                        
              Between June 1990 and August 1990, Merrill Lynch exercised              
         its option under a side agreement with Fuji and purchased $40                
         million of the $100 million principal amount of Chase PPNs that              
         Fuji was holding.  On February 25, 1991, Fuji elected to exercise            
         the put option with respect to the remaining $60 million                     
         principal amount of the Chase PPNs.  On April 17, 1991,                      
         Norinchukin elected to exercise the put option with respect to               
         the $100 million principal amount of the Chase PPNs that it held.            
         V.   Saba-Related Swaps                                                      
              A.  Fuji and Norinchukin Swaps                                          
              Merrill Lynch offered Fuji and Norinchukin structured                   
         transactions to be implemented in conjunction with their                     
         agreement to purchase the Chase PPNs from Saba for cash and LIBOR            
         notes.  In financial terminology, a "structured transaction" is              
         one that combines two or more financial instruments or                       
         derivatives.  Most structured transactions, like those in this               





Page:  Previous  39  40  41  42  43  44  45  46  47  48  49  50  51  52  53  54  55  56  57  58  Next

Last modified: May 25, 2011