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petitioner’s reliance on Erickson Post Acquisition, Inc. v.
Commissioner, supra, to be misplaced. That case is materially
distinguishable from the instant case. In Erickson Post Acquisi-
tion, Inc., the Court found that, at the time the taxpayer
received the funds in question, the taxpayer had an unconditional
obligation to repay the full amount of such funds and that “Not
only was the transaction in form a loan but, under the circum-
stances of this case, that was also its substance.” Erickson
Post Acquisition, Inc. v. Commissioner, supra. Unlike the
findings of the Court with respect to the obligation of the
taxpayer in Erickson Post Acquisition, Inc., we have found that,
at the time of the transaction at issue, the substance of that
transaction was that any obligation of petitioner under the April
15, 1999 note did not arise unless and until there was a material
breach by petitioner of the April 16, 1999 supply agreement and
that petitioner did not have an unconditional obligation to make
each of the annual payments set forth in the April 15, 1999
note.19
19On the record before us, we reject petitioner’s argument
that certain alleged loan transactions between it and SUPERVALU
that occurred after Super Rite advanced the $1.5 million at issue
to petitioner (subsequent transactions) support its position that
the $1.5 million at issue constitutes a loan. Assuming arguendo
that we had found that the subsequent transactions constitute
loans, those subsequent transactions do not control whether at
the time petitioner received the $1.5 million at issue petitioner
had an unconditional obligation to make each of the annual
payments set forth in the April 15, 1999 note. See Haag v.
(continued...)
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