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between and among PI, ECI, F&G, Dickinson, and RRI as the
Dickinson transactions.
The sales of the Sentinel EPS recyclers from PI to ECI were
financed using 12-year nonrecourse notes. The sales of the
recyclers from ECI to F&G were financed using 12-year “partial
recourse” notes; however, the recourse portion of the notes was
payable only after the first 80 percent of the notes, the
nonrecourse portion, was paid. No arm’s-length negotiations for
the price of the recyclers took place between, or among, PI, ECI
and F&G.
At the closing of the Dickinson transaction, PI, ECI, F&G,
Dickinson, and RRI entered into arrangements whereby PI would pay
a monthly joint venture fee to Dickinson, in the same amount that
Dickinson would pay as monthly rent to F&G, in the same amount
that F&G would pay monthly on its note to ECI, in the same amount
that ECI would pay monthly on its note to PI. Further, in
connection with the closing of the Dickinson transaction, PI,
ECI, F&G, Dickinson, and RRI entered into offset agreements so
that the foregoing payments were bookkeeping entries only and
were never in fact paid. Also in connection with the closing of
the Dickinson transaction, PI, ECI, F&G, Dickinson, and RRI also
entered into cross-indemnification agreements.
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Last modified: May 25, 2011