David Taylor Enterprises, Inc. & Subsidiaries - Page 4

                                        - 4 -                                         
          either by purchase, exchange of one classic car for another, or             
          as trade-ins from new car customers to reduce the purchase price            
          of a new Cadillac or Buick.  The dealership’s purpose in                    
          acquiring the classic cars was to enhance their value by                    
          restoring them and selling them at a premium price.5                        
               The dealership viewed potential buyers of the classic cars             
          as a select group of mostly wealthy classic car enthusiasts, and            
          designed a strategy to reach them.  The dealership’s strategy               
          involved building the dealership’s reputation as a source of high           
          quality classic cars by entering the cars in auctions, auto                 
          shows, classic car competitions, and displaying them at                     
          promotional events for the dealership or third parties.  For                
          instance, the classic cars were displayed at events frequented by           
          wealthy individuals, like the Alley Theatre and the annual                  
          Lakewood Yacht Club Wooden Keels and Classic Wheels event.  The             
          classic cars were also prominently advertised in brochures,                 
          booklets, newspapers, and magazine articles, and a placard                  
          describing each car was also placed on each vehicle.                        
               Potential buyers of the classic cars were directed to Mr.              
          Taylor or a broker the dealership hired after Mr. Taylor died.              

               5The classic cars were insured, and the insurance policy               
          covered “all owned antique, classic and special interest cars               
          held for sale by the insured.”  The classic cars were also taxed            
          by local property taxing authorities as “motor vehicle                      

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