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borne by the partners in accordance with their respective
interests. Pursuant to the Bermuda Agreement, however,
AlliedSignal was obligated to, and did in fact, pay all of ASA's
expenses. We also note that AlliedSignal's obligation to bear
expenses reduced AlliedSignal's return and undermined the stated
purpose of "obtaining a yield in excess of what they could obtain
from U.S. treasury securities".
D. Management
The partnership agreement stated that the partners would
share in the management of ASA. The agreement provided that
ASA's activities would require the "vote or consent" of partners
whose partnership percentages totaled at least 95 percent. In
reality, however, AlliedSignal made all the critical decisions.
ABN was a compliant and accommodating party, which was chosen for
the venture because it was willing to serve at AlliedSignal's
direction.
The management provision in the partnership agreement was
perfunctory, because the scheduled steps were prearranged by
Merrill Lynch and agreed to by AlliedSignal and ABN before they
executed the partnership agreement. The distribution of the
LIBOR notes typifies how management responsibilities were
"shared". Before the parties executed the partnership agreement,
AlliedSignal had already decided that the LIBOR notes would be
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