Edward R. Arevalo - Page 14

                                       - 14 -                                         
          transactions among petitioner, ATC, and Alpha Telcom, we reject             
          petitioner’s contention for the reasons discussed below.                    
               First, petitioner had no control over the pay phones, never            
          had possession of the pay phones, and does not know what the pay            
          phones look like or where they are located.  Petitioner signed an           
          agreement containing blank spaces where the pay phones were to be           
          identified.                                                                 
               Second, petitioner never had the power to select the                   
          location of the pay phones or enter into site agreements with the           
          owners or leaseholders of the premises where the pay phones were            
          to be located; that power was held by Alpha Telcom through the              
          Alpha Telcom service agreement.                                             
               Third, no evidence indicates that petitioner paid any                  
          property taxes, insurance premiums, or license fees with respect            
          to the pay phones.                                                          
               Fourth, there was minimal risk of loss for petitioner                  
          because the ATC pay phone agreement, in combination with the                
          Alpha Telcom service agreement, allowed petitioner to sell legal            
          title to the pay phones back to ATC for 10 percent less than the            
          amount that he invested in them in the first 36 months and for              
          the full amount that he invested in them after 36 months.                   
               Fifth, under the terms of the Alpha Telcom service                     
          agreement, Alpha Telcom was entitled to receive most of the                 
          profits from the pay phones.                                                






Page:  Previous  4  5  6  7  8  9  10  11  12  13  14  15  16  17  18  19  20  21  22  23  Next

Last modified: May 25, 2011