Winn-Dixie Stores, Inc. and Subsidiaries - Page 47




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          effect of the COLI plan was a first-year loss40 of $4,188,000               
          computed as follows:                                                        
                    Net premium payment          $7,245,000                           
                    Interest on policy loan      11,191,000                           
                    Administrative fees             290,000                           
                                                  18,726,000                          
               Less:  Net cash surrender value     11,287,000                         
                    Death benefits                3,250,000                           
                                                  14,537,000                          
                    Loss                          14,189,000                          
                    1The June 1993 projection shows $4,188,000.  This is apparently   
               due to rounding or a math error.                                       
          Following the same approach, the June 1993 projections show the             
          COLI plan producing pretax losses in the next 2 policy years of             
          $7,885,000 and $10,869,000, respectively.  Thereafter, the pretax           
          losses over the next 57 years range from $6,244,000 in the last             
          year to $16,447,000 in year 2021.  The total of pretax losses for           
          the projected 60 years was $681,922,000.  In each and every year,           
          the combined yearly pretax benefits from the policies; i.e., the            
          expected death benefits from the 36,000 policies plus the year-             
          end net equity value of the policies, were substantially less               
          than petitioner's cost of maintaining the policies.                         
               The next part of the June 1993 profit and loss projections             
          illustrates the "tax effect" of the COLI plan.  The profit and              
          loss statement contained in the June 1993 projections shows                 


               40The projections refer to the loss as negative pretax                 
          earnings.                                                                   




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