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C. Analysis and Holding
1. Petitioner’s Agreement With NSI
The December 1, 1996, consulting agreement executed by NSI
and petitioner required that petitioner provide consulting
services to NSI Enterprises and its affiliates for a 3-year
period ending November 30, 1999, in exchange for a $2.5 million
fee, payable in full on the December 1, 1996, contract date. The
consulting agreement contained no mention of NSI’s plan to divest
itself of its tax benefit lease. As we have found, NSI’s and
petitioner’s actual agreement was that petitioner would find a
buyer for Corisma (the NSI affiliate holding the tax benefit
lease and the RD stock) and assist NSI in consummating a sale of
Corisma’s shares. As we understand that agreement, petitioner in
return for its services would earn and receive a $2.5 million fee
from NSI. Upon concluding the sale of LLDEC’s (Corisma’s) shares
to CKH on January 30, 1997, NSI paid the agreed $2.5 million fee
to petitioner. See Greene v. United States, 13 F.3d 577, 581 (2d
Cir. 1994); Ferguson v. Commissioner, 108 T.C. 244, 259 (1997),
affd. 174 F.3d 997 (9th Cir. 1999).
2. CKH’s and Petitioner’s Purported Fee-Splitting
Agreement
Crispin testified that he had estimated that $4 million
would be earned from the NSI tax deal and that he had proposed to
Koehler that CKH and petitioner share this $4 million equally.
In his testimony, Crispin also asserted that a securities dealer
would have demanded as much as 90 percent of the fee in question.
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