- 35 -
if further investigation and analysis verifies * * *
[that] the data and projections respecting Tri-Power
meet those expectations outlined to the Directors in
this meeting, the officers of the Company are
authorized to make a bid not to exceed ten and one half
million dollars ($10,500,000) for all the capital stock
of * * * [Tri-Power].
Petitioner's board rejected TPC's proposed retention of a
20-percent net profits interest.
On October 22, 1986, 8 days after the issuance of the 1986
LAM updated reserve report, petitioner issued a letter of intent
to enter into a definitive agreement to purchase 100 percent of
the stock of Tri-Power for $9.75 million. Petitioner conditioned
the acquisition on, inter alia, the receipt of a favorable
opinion from its tax adviser. The letter of intent states as
follows:
Plains will not consummate the transaction contemplated
hereby until it receives an opinion letter from its tax
advisor * * * stating the Plains' tax advisor has reviewed
all tax information relevant to the business of Tri-Power
and Tri-Power's predecessors, that the tax returns and data
supporting those returns are accurate, complete and
verifiable as such and that in such advisor's opinion
Plains' acquisition of Tri-Power as provided for in the
definitive Agreement should achieve the tax consequences
intended by the parties thereto.
Petitioner further conditioned the acquisition on the receipt of
an opinion from Tri-Power's tax counsel, in a form satisfactory
to petitioner, that (1) Tri-Power and its predecessors had filed
timely all tax returns required by Federal, State, county and
local taxing authorities, (2) the information contained in those
Page: Previous 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 NextLast modified: May 25, 2011