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and ASIC's respective interests to 65.87 and 1.13 percent.
Throughout the venture, AlliedSignal and ABN carefully
calculated the shortfall between ABN's specified return and
Barber's and Dominguito's income allocations. On its 1990
financial records, AlliedSignal recorded the shortfall as an
accrued liability, thereby treating the amount as a present
obligation. On December 5, 1991, after calculating a shortfall,
AlliedSignal paid ABN $1,631,250. The payment consisted of:
$765,147 (i.e., the difference between ABN's funding cost and
Barber's and Dominguito's combined income allocations); $231,250
(i.e., interest on $92 million of ABN funds that remained in ASA
until November, rather than March 1991, as had been established
in the Bermuda agreement); and $634,853. The $634,853 payment
was the difference between the $5 million ABN requested that
AlliedSignal pay "up-front" and the $4,400,000 AlliedSignal paid
on August 2, 1990, plus interest. AlliedSignal and ABN had
considered making this payment in the form of a "consulting fee",
but they ultimately decided against this characterization.
On April 8, 1992, ASA redeemed 8 percent of ASA from
Dominguito for $76,961,863. After the distribution, the ASA
interests held by AlliedSignal, ASIC, and Dominguito were 73.74
percent, 1.26 percent, and 25 percent, respectively.
IX. ASA Is Liquidated
During April and May 1992, AlliedSignal representatives and
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