CGF Industries, Inc. and Subsidiaries - Page 6




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          The Solicitation                                                            
               By letter dated May 15, 1986, and an addendum dated March              
          30, 1988, Robert A. Page4 advised CGF and Lincoln's shareholders            
          on the benefits of a "split purchase of assets".  According to              
          Mr. Page, the older generation would buy a life estate or term of           
          years, while the younger generation would purchase the remainder            
          interest.  In the addendum, Mr. Page substituted the word                   
          "corporation" for "older generation".  In his words, the                    
          objective of a split purchase5 was twofold:  (1) To transmit                
          property to future generations without incurring a transfer tax             


               3(...continued)                                                        

               Familial ties also exist between CGF and Lincoln.  Olivia G.           
          Lincoln and Ruth G. Fink, who served as president of CGF in July            
          1988, are sisters.  Their brother is Willard Garvey, president of           
          a corporation named Garvey Industries, Inc.                                 
               4Robert A. Page was an investment adviser to CGF and                   
          Lincoln.  His role, however, extended beyond that of just an                
          adviser.  Mr. Page served on Lincoln's board of directors, and              
          beginning calendar year 1988, he also served on Lincoln's                   
          executive committee.  Mr. Page's role was not a passive one.                
          According to the minutes of the board's annual meeting convened             
          Oct. 8-10, 1987, Mr. Page "led an in-depth discussion regarding             
          the current and future operations of Lincoln Industries, Inc."              
               Mr. Page also has links to CGF and various family trusts.              
          He was vice president of DICO, Inc., a company which merged into            
          CGF effective July 1, 1988, pursuant to a merger agreement and by           
          resolution of CGF's board of directors.  Mr. Page also acted as             
          trustee, or in more instances, as successor trustee in a handful            
          of family trusts.  According to the trust agreements, the succes-           
          sor trustee assumes the duties of trustee in the event of the               
          trustee's death or inability or unwillingness to serve.                     
               5Throughout this opinion, we use the terms "split purchase",           
          "joint purchase", "joint asset acquisition", "joint asset                   
          purchase", and "joint investment transaction" interchangeably to            
          mean a situation where person A and person B, for example, simul-           
          taneously acquire a present and a future interest in property,              
          respectively.                                                               
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