Karns Prime & Fancy Food, Ltd. - Page 28

                                       - 28 -                                         
          id.; see also Herbel v. Commissioner, 106 T.C. 392, 416-417                 
          (1996), affd. 129 F.3d 788 (5th Cir. 1997).  On the record before           
          us, we find that petitioner had “some guarantee” that, for each             
          annual period covered by the April 16, 1999 supply agreement and            
          the corresponding April 15, 1999 note, it would be allowed to               
          keep the amount of the annual payment set forth in that note as             
          long as, for each such period, it lived up to its end of the                
          bargain by not materially breaching the April 16, 1999 supply               
          agreement.21  See Commissioner v. Indianapolis Power & Light Co.,           

               trative agency of competent jurisdiction for the ap-                   
               pointment of a receiver or trustee for the administra-                 
               tion of the affairs of the Retailer, if an order for                   
               relief shall be entered and continued unstayed in                      
               effect for thirty (30) days or such petition or appli-                 
               cation shall continue undismissed for sixty (60) days;                 
               (iv) following the breach of any obligation of the                     
               Retailer hereunder, if such breach is not cured within                 
               thirty (30) days following notice thereof to the                       
               breaching party; (v) following the default by Retailer                 
               in the performance of or compliance with any material                  
               contract, instrument or agreement, including, without                  
               limitation, any lease of real property, any material                   
               lease of personal property or any promissory note,                     
               instrument or agreement evidencing or in respect of any                
               indebtedness for borrowed money or any security there-                 
               for, if such default is not cured within any applicable                
               period of grace, or (vi) immediately upon the occur-                   
               rence of a material adverse change in the condition                    
               (financial or otherwise), business or prospects of the                 
               Retailer or any guarantor of the Retailer’s liabilities                
               and obligations hereunder. * * *                                       
               21On the record before us, we reject petitioner’s contention           
          that if Super Rite had commenced a bankruptcy proceeding, peti-             
          tioner would have been in default under the April 16, 1999 supply           
          agreement.  Pursuant to the April 16, 1999 supply agreement, the            

Page:  Previous  10  11  12  13  14  15  16  17  18  19  20  21  22  23  24  25  26  27  28  29  Next

Last modified: May 25, 2011