Santa Monica Pictures, LLC, Perry Lerner, Tax Matters Partner - Page 318

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          contributed $10,000 cash, and SMP contributed $250,000 cash and             
          the $79 million receivable.  As of November 5, 1997, Corona’s               
          capital accounts and percentage interests were as follows:                  
                         Capital Account      Percentage Interest                     
               Imperial            $0             0.00%                               
               SMP            1,550,000                99.00                          
               Mr. Lerner     5,000                0.33                               
               Peridon              10,000                0.67                        
               Total          $1,565,000               100.00                         
               The Corona LLC agreement recited that the purposes for                 
          Corona’s formation were “to finance the production and                      
          exploitation of filmed entertainment products and to own                    
          interests in entities engaged in such activities” and “to make              
          investments in connection with the foregoing activities and                 
          otherwise.”  The Corona LLC agreement appointed Mr. Lerner as its           
          manager and authorized him to act on behalf of Corona to appoint            
          employees, officers, or additional managers, and to bind the                
          company in dealings with third parties.58                                   
               2.  The Corona Transaction                                             
               On December 11, 1997, Mr. Lerner sent an email to Irv                  
          Gubman, Imperial’s general counsel, proposing that the previously           
          discussed transaction be done through Corona rather than SMP.               
          The email states:                                                           

               58 On Dec. 16, 1997, the secretary of state of Delaware                
          certified:  “Corona Film Finance Fund LLC is duly formed under              
          the laws of the State of Delaware and is in good standing and has           
          a legal existence so far as the records of this Office show as of           
          the sixteenth day of December, A.D. 1997.”                                  





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