- 39 -
diligence review. Among other concessions, petitioner
represented to GATX that to the best of petitioner’s knowledge,
as of the date of the closing, the schedules in the contract were
the actual status of the individual leases and, to the extent
they were not, there would be a postclosing adjustment to
accurately reflect the discrepancies.
During the negotiations, GATX requested that ML Vessel
Leasing Corporation (Vessel Leasing), a wholly owned subsidiary
of ML Capital Resources, not be included in the ML Capital
Resources portfolio because GATX/BCE could not own the assets in
Vessel Leasing due to restrictions under Federal laws.29 By
resolution dated June 10, 1987, the respective boards of ML
Capital Resources and ML Asset Management approved the sale of
all the stock of Vessel Leasing to ML Asset Management. On that
same date, ML Capital Resources and ML Asset Management entered
into a stock purchase agreement with respect to Vessel Leasing’s
stock. The purchase price for the stock was $367,481. The sale
closed on June 10, 1987. Immediately before its purchase of
Vessel Leasing, ML Asset Management had accumulated earnings and
profits that exceeded the purchase price. This is the eighth
cross-chain sale at issue for the taxable year ended December 25,
29BCE was a Canadian corporation and could not legally own a
vessel that had been financed by the U.S. Government.
Page: Previous 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 NextLast modified: May 25, 2011