Daniel C. Greer and Winnie L. Greer - Page 12
- 12 -
to further assessment, and as a limited partner, Mr. Greer was not
personally liable for the debts, obligations, or losses in Madison
in excess of his $50,000 capital contribution.
B. The Underlying Madison Transaction
The Madison promotion involved the following simultaneous
(1) On or about December 31, 1982, PI sold four Sentinel EPS
Recyclers to Ethynol Cogeneration, Inc. (ECI), for $1,520,000 each
or a total of $6,080,000.
(2) The consideration of $6,080,000 provided by ECI
consisted of cash in the amount of $481,000 and a 12-year
nonrecourse note in the amount of $5,599,000, which was secured by
a first lien on the four recyclers.
(3) ECI sold the four recyclers to F&G Equipment Corp. (F&G)
for $7 million or $1.75 million each.
(4) The consideration provided by F&G consisted of cash in
the amount of $553,000 and a 12-year note in the amount of
$6,447,000, of which 80 percent was nonrecourse. The nonrecourse
portion of the note was senior to the recourse portion. The note
was secured by a second lien on the four recyclers.
(5) F&G agreed to lease the four recyclers to Madison. The
lease agreement terminated in 9-1/2 years and required an annual
lease payment of $960,000, or $80,000 per month.
Page: 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19
Last modified: November 10, 2007