ASA Investerings Partnership, Alliedsignal Inc., Tax Matters Partner - Page 37

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             distributed to it.  While the minutes of the August 21, 1990,                                        
             meeting state that Dominguito's representative preferred cash                                        
             distributions and expressed concern about the "volatility of the                                     
             LIBOR notes", ABN had no such concern because it was fully                                           
             hedged.  The minutes were manufactured to give the impression                                        
             that ABN was playing an active management role when it was not.                                      
             From the outset of their relationship, ABN was fully aware that                                      
             the LIBOR notes would be distributed to AlliedSignal.                                                
                    E.  Conclusion                                                                                
                    The characteristics of AlliedSignal and ABN's relationship                                    
             are contrary to the characteristics of a bona fide partnership.                                      
             AlliedSignal and ABN had divergent, rather than common,                                              
             interests.  Moreover, they did not share in the venture's profit                                     
             and losses and did not comply with their partnership agreement                                       
             when it conflicted with the Bermuda Agreement.  AlliedSignal and                                     
             ABN knew that their conduct could jeopardize ASA's partnership                                       
             status, so they carefully avoided documenting their true intent.                                     
             In short, AlliedSignal, ASIC, and ABN's agents--Barber and                                           
             Dominguito--did not have the requisite intent to join together                                       
             for the purpose of carrying on a partnership and sharing in the                                      
             profits and losses therefrom.  Further analysis reveals that                                         
             AlliedSignal and ABN had a debtor-creditor relationship.                                             
             V.  Debtor-Creditor Relationship                                                                     
                    Whether parties are in a partnership or a debtor-creditor                                     





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