EFTA02478189

From: Bronstein, Richard J Sent: Saturday, December 12, 2015 6:41 PM To: jeffrey E. Subject: RE: PRIVILEGED & CONFIDENTIAL Same view wth or without Richard. I think that time commitment unders=anding came from Brad W, I assume he got it from Leon but I don't know for=sure. If business continues down, then Leon is just getting a timing benef=t (assuming that write-off comes before he dies). How much is that worth? We are for sure on the same team, everything is based only on what I believ= to be Leon's best interests, please don't take differing views as suggest=ng anything else. Richard J. Bronstein I Partner Paul, Weiss, Rifkind, Wharton & Garrison LLP 1285 Avenue of the Americas I New York, NY 10019-6064 www.paulweiss.com From: jeffrey E. <[email protected]> Sent: Saturday, December 12, 2015 1:30:51 PM To: Bronstein, Richard.' Subject: Re: PRIVILEGED & CONFIDENTIAL i understand your concern. . however the =greatest likelihood is that this business will continue its downward spira=. leon will also end up writing off the debt . please ke=p in mind that you and I are on the same team. , =- we have not met. . I have great respect for your tax views . &nbs=; do you do many 1040 audits ? =f brad did it all without richard, same view. the time comm=tment that you referenced. did you get that from Leon? On Sat, Dec 12, 2015 at 1:17 PM, Bronstein, Rich=rd 1 > wrote: <mailt° I understand the technical arguments, which are not so bad, but the co=cern comes from the facts that LDB doesn't really want to get out and will=stay involved and he is not dealing with unrelated persons, he is dealing =ith an employee and his brother-in-law, neither of whom really want to own this business, they are doing this only=because LDB asked them to do this. Plus if the business increases in=value and LOB buys it back at FMV, then he will give up some or all of the=tax savings in the repurchase price. So he is taking risk for a benefit that he might not get to keep. EFTA_R1_01592461 EFTA02478189 Richard J. Bronstein I Partner Paul, Weiss, Rifkind, Wharton & Garrison LLP 1285 Avenue of the Americas I New York, NY 10019-6064 I www.paulweiss.com <http://w . ww.pa u I wei ss.com> From: jeffrey E. <[email protected] <mailto:[email protected]» Sent: Saturday, December 12, 2015 1:11:47 PM To: Bronstein, Richard Subject: Re: PRIVILEGED & CONFIDENTIAL if it were publicly traded stock, wash sale rules wo=ld apply, and be clear. even you had every intention of =uying it back after 30 days, would you still be concerned. &nbs=; is there a way that you feel comfortable. On Sat, Dec 12, 2015 at 1:06 PM, Bronstein, Rich=rd J <mailto > wrote: Brad W pays 1/3 to 1/2 cash plus nonrecourse note, put after two years=at FMV, put expires after five years. I would rather have no put at =11, but apparently Ressler (all cash) insists on it, so Brad would have it= too. Frankly, we can dress the transaction up all we want, but I think the IRS w=ll not approve the transaction in any event, on audit they will be skeptic=l and believe that there is an understanding that LDB will take care of &n=sp:the buyers and they will believe that he and his wife want to keep the business (and the facts will show th=t they stayed involved and didn't reduce their time commitment at all) , a=d we will face an ugly choice between settling by giving up 40-60% of the =oss or going to Tax Court, which will result in an embarrassing article in the Wall Street Journal. Richard J. Bronstein I Partner Paul, Weiss, Rifkind, Wharton & Garrison LLP 1285 Avenue of the Americas I New York, NY 10019-6064 I www.paulweiss.com <http://www.paulweiss.com> From: jeffrey E. <[email protected] <mailto:[email protected]» Sent: Saturday, December 12, 2015 12:55:58 PM To: Bronstein, Richard J Subject: Re: PRIVILEGED & CONFIDENTIAL 2 EFTA_R1_01592462 EFTA02478190 what do you suggest On Sat, Dec 12, 2015 at 12:51 PM, Bronstein, Ric=ard 1 cmailt° wrote: I'm not sure there is any difference between (a) 25% cash plus 75% non=ecourse note and (b) 100% cash and recourse note with put at 75%. Ei=her way, I would prefer more than 25% exposure to buyer. Richard J. Bronstein I Partner Paul, Weiss, Rifkind, Wharton & Garrison LLP 1285 Avenue of the Americas New York, NY 10019-6064 www.paulweiss.com <http://www.paulweiss.com> From: jeffrey E. <[email protected] <[email protected]» Sent: Saturday, December 12, 2015 12:37:13 PM To: Bronstein, Richard J Subject: Re: PRIVILEGED & CONFIDENTIAL understood, what do you think of the fix=d price put below purchase price. . and that brad pays for it&=bsp; , he should also pay real interest , and full recourse n=te are you ok with 25% below purchase price On Sat, Dec 12, 2015 at 11:02 AM, Bronstein, Ric=ard 1<1 1 wrote: No sales tax because the underlying asset is an intangible, i.e., an i=terest in Phaidon Global LLC, so an sale of an individual interest is a sa=e of an intangible. Different answer if the undivided interest relat=s to tangible assets (e.g., art). Richard J. Bronstein I Partner Paul, Weiss, Rifkind, Wharton & Garrison LLP 1285 Avenue of the Americas I New York, NY 10019-6064 I www.paulweiss.com <http://www.paulweiss.com> 3 EFTA_R1_01592463 EFTA02478191 EFTA02478192 EFTA02478193 EFTA02478194 EFTA02478195