Wallace R. Noel and Robinette Noel - Page 5

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          public offering of PMI stock would violate the terms of the fran-           
          chise agreements between Pizza Hut and PMI.                                 
               PepsiCo's actions2 in preventing the public offering                   
          adversely affected the value of petitioner's PMI stock.  Also,              
          petitioner suffered personal emotional distress as a consequence            
          of PepsiCo's actions.  Further, the damages to petitioner's                 
          business reputation caused by PepsiCo resulted in petitioner's              
          suffering personal financial setbacks in ventures unrelated to              
          his investment in PMI.                                                      
               In May 1988, petitioner, as a shareholder of PMI, and his              
          children, as shareholders of PMI, brought a civil action against            
          PepsiCo,Pizza Hut, PMI, and other PMI shareholders.  Petitioner             
          alleged that he suffered damages as a result of Pizza Hut's                 
          refusal to allow the public offering to go forward.  Specifi-               
          cally, petitioner made three claims against Pizza Hut and                   
          PepsiCo.  First, petitioner alleged that PMI and PepsiCo had                
          entered into agreements, after petitioner had transferred his               
          sole proprietorship restaurants to PMI, which restricted PMI's              
          right to "go public" and that the agreements between PepsiCo and            
          PMI constituted a breach of obligations owed to petitioner as a             
          third-party beneficiary under the original agreements between               
          Pizza Hut and PMI.  Second, petitioner urged that Pizza Hut be              

          2By the spring of 1986, PepsiCo had purchased all of the                    
          stock of Pizza Hut, and Pizza Hut became a wholly owned                     
          subsidiary of PepsiCo.                                                      

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