Andantech L.L.C., Wells Fargo Equipment Finance, Inc. (f.k.a. Norwest Equipment Finance, Inc.), Tax Matters Partner, and Wells Fargo & Co., A Partner Other Than the Tax Matters Partner, et al. - Page 118




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          indicate that Comdisco approached NationsBank to “provide                     
          financing” for a sale/leaseback transaction involving a lease                 
          receivable purchase with Comdisco as the obligor.  NationsBank                
          expected the transaction to generate “$168,000 in net interest                
          income for assuming a short-term, unsecured credit position with              
          Comdisco”. Although Comdisco had historically prepaid each                    
          receivable purchase transaction funded by NationsBank, Comdisco               
          could elect not to prepay.  “In this situation, NationsBank would             
          hold a 36 month, unsecured loan to Comdisco at 75bp.”                         
               Under the terms of the term note for the purchase of the                 
          equipment, Andantech’s sale of the rents to NationsBank accelerated           
          the term note.  Andantech directed NationsBank to wire transfer the           
          proceeds from the rent sale ($87,805,802) to Comdisco in payment of           
          Andantech’s obligations to Comdisco under the term note.                      
          NationsBank did so, and Comdisco canceled the term note.                      
               The rents owed by Comdisco before the early termination date             
          were calculated to equal the amount due on the term note.  The sale           
          of those rents to NationsBank was in fact a short-term loan to                
          Comdisco, and Andantech was required to use the proceeds to pay off           
          the term note.  There was no substance to the financing of the                
          transaction.  See Mapco Inc. v. United States, 556 F.2d at 1110.              
                               iv. The Degree of Adherence to Contractual               
                               Terms                                                    
               A transaction having economic substance has as one of its                
          characteristics an intent by the parties of having their agreements           






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