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On June 15, 1988, the MIC board of directors, consisting of
Arnold, Martin, and Mr. Hewit, adopted a resolution, which was
approved by Arnold and Martin as shareholders, declaring that MIC
was in two separate businesses of equal fair market value, one
distributing ice cream to supermarket chains and food service
accounts and another distributing ice cream to small independent
grocery stores. The resolutions stated that MIC undertook the
transaction to split into two corporations in order to resolve
the dispute between Arnold and Martin over the future direction
of MIC and whether it would focus on distribution to supermarkets
or to food service accounts and small stores and that Martin
wished to operate the business of distribution of H�agen-Dazs ice
cream products to nonsupermarket stores. Martin and Arnold each
submitted his written resignation as a director, officer, and
employee of the other company, Martin from SIC, and Arnold from
MIC. Each of these documents bore the typed date “June 3, 1988”,
which was crossed out and amended by hand to read “June 15,
1988”. None of the resolutions, agreements, or resignations
contain any guaranty or indemnification from SIC or Arnold that
would protect MIC or Martin from any tax liabilities arising from
the split-off or the contemplated sale to H�agen-Dazs.
On June 20, 1988, Arnold and Mr. Hewit signed a directors’
resolution of SIC, submitting to Arnold, as sole shareholder of
SIC, an offer by H�agen-Dazs to “purchase all of the rights of
the Corporation [SIC] to distribute Haagen-Dazs ice cream
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