- 8 -
undivided interest in the AVS unit II that such owner participant
acquired from petitioner. The owner participants assumed in the
aggregate 100 percent of petitioner’s obligation to Mercer County
to pay the 1984 sublease rent. Each owner participant agreed to,
and did, issue a promissory note (series B secured note) to
evidence its obligation to pay that portion of the 1984 sublease
rent that it assumed when it acquired from petitioner its per-
centage undivided interest in the AVS unit II. As a result,
pursuant to the 1984 lease and sublease, petitioner was dis-
charged from its obligation under the Basin Electric 1984 note,
and the owner participants became the obligors under the 1984
tax-exempt bonds.
Under the 1985 sale and leaseback, the owner participant
leased to petitioner its percentage undivided interest in the AVS
unit II for a term that began on December 3, 1985, and that was
to end on December 30, 2015. Petitioner had the right to extend
that lease term for each of two five-year terms. The 1985 sale
and leaseback required petitioner to pay a variable amount of
money as rent (basic rent) semiannually on June 30 and December
30.4 With respect to that variable amount of basic rent, the
1985 sale and leaseback provided:
4The amount of basic rent agreed to was a fixed amount set
forth in a schedule to the 1985 sale and leaseback plus or minus
an amount calculated by reference to certain specified interest
rates set forth in another schedule to the 1985 sale and
leaseback.
Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Next
Last modified: May 25, 2011