Hubert Enterprises, Inc. and Subsidiaries, et al. - Page 24

                                        -24-                                          
               On July 31, 1998, CRG purchased from Starwood the remaining            
          39.45-percent interest (39.45-percent interest) in the 1998 Amtel           
          equipment for $5,814,720.10, and CRG leased the 39.45-percent               
          interest back to Starwood.  Pursuant to promissory notes dated              
          July 31, 1998, CRG promised to pay Starwood $5,346,686.52 and               
          $53,932.54.                                                                 
               Also on July 31, 1998, LCL purchased the 39.45-percent                 
          interest (subject to the lease) from CRG for $5,814,720.10.                 
          Pursuant to promissory notes dated July 31, 1998, LCL promised to           
          pay CRG $5,310,887.56 and $53,832.54.  No individual member of              
          LCL signed or guaranteed these notes, the first of which stated             
          it was recourse to the extent of $2.75 million and that payments            
          of principal and interest would be applied to the recourse                  
          portion before the nonrecourse portion.  The second note stated             
          it was nonrecourse.                                                         
               For each of its taxable years ended in 1998 through 2001,              
          LCL reported as to the 1998 Amtel equipment the following amounts           
          of lease income, interest expense, depreciation, net “G&A”                  
          expense and interest income, and loss:                                      
          1998           1999         2000         2001                               
          Lease income               -0-       $1,987,157    2,167,807   $2,167,807   
          Interest expense       ($156,167)      (971,811)    (877,785)    (786,273)  
          Depreciation          (2,948,385)    (4,717,416)  (2,830,450)  (1,698,270)  
          Net G&A expense                                                             
          and interest income      -0-            4,047       32,922       13,815     
          Loss                   3,104,552      3,698,023    1,507,506      302,921   







Page:  Previous  14  15  16  17  18  19  20  21  22  23  24  25  26  27  28  29  30  31  32  33  Next

Last modified: May 25, 2011