Salina Partnership LP - Page 9




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          strategy.  Mr. Ackert promoted the STAMPS strategy as a means to            
          increase the return on FPL’s short-term, fixed-income investments.          
          At the same time, Mr. Ackert informed FPL that it should rely upon          
          its own independent accounting, legal, and tax advisers regarding           
          the consequences of the STAMPS investment strategy.  During a               
          private meeting with Mr. Higgins, Mr. Ackert suggested that the             
          partnership’s investments could be arranged so that, upon entry             
          into the partnership, FPL would recognize a capital gain for                
          Federal income tax purposes and simultaneously create a built-in            
          loss in its partnership interest.                                           
               In late October 1992, Mr. Ackert introduced Mr. Silverstein to         
          FPL’s representatives.  Mr. Silverstein took the opportunity to             
          explain the MAPS investment strategy and to offer BEA’s investment          
          services to FPL.  In mid-November 1992, FPL representatives met             
          with Mr. Silverstein at BEA’s New York office.  At FPL’s request,           
          Mr. Silverstein presented FPL with several analyses of the                  
          financial risks and rewards associated with the MAPS investment             
          strategy under a variety of economic scenarios.  Using Treasury             
          bills (with a then 3 percent annual rate of return) as a benchmark,         
          Mr. Silverstein projected that the MAPS strategy would allow FPL to         
          earn between 4 and 7 percent over current Treasury bill yields.             
          However, Mr. Silverstein cautioned that he could not guarantee a            
          specific return inasmuch as FPL’s investment would be subject to            
          market risks.  FPL’s representatives concluded that the company             






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