45. LO.4 Midori Corporation is a distiller of time liqueurs. The market for this specialty product is thin but very lucrative. Midori wants to diversify its product line and is inter- csted in acquiring Verdigris, which specializes in exotic teas and spices. Because the spice products are of no interest to Midori, it suggests that Verdigris dis- pose of this line of business before the merger. Midori would then exchange 15% of its stock and $500,000 for the remaining assets of Verdigris. The Midori stock would be dis- tributed to 30% of the Verdigris shareholders for their stock; the remaining Verdigris shareholders would receive cash. What income tax problems can you identify with the proposed transactions