P. David Musgrave and Barbara J. Musgrave - Page 5

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               On March 3, 1988, the Estate's administrator filed a                   
          Complaint for Declaratory Judgment in the Court of Common Pleas             
          of Warren County, Ohio (Warren County Court), Case No. 3-3-88-              
          102-46883 (insurance suit).  In the insurance suit, the Estate              
          sought a judicial determination of the relative rights of the               
          Estate, the S Corporation, and petitioner with regard to the                
          proceeds from the Prudential life insurance policy on Mr.                   
          Jeffcott's life (insurance proceeds).                                       
               On April 28, 1988, a status conference and hearing were held           
          in the embezzlement suit.  During those proceedings, Color Q                
          agreed that in the event that any of the defendants in the                  
          embezzlement suit were adjudicated to be rightful beneficiaries             
          of the insurance proceeds as a result of the insurance suit,                
          Color Q would accept the amount of $190,000 in full and final               
          settlement of all claims with respect to all defendants in the              
          embezzlement suit.  Additionally, during those proceedings, each            
          of defendants JNANA, Teresa L. Jeffcott, the S Corporation, and             
          petitioner agreed that if the court in the insurance suit found             
          any one of them to be the rightful recipient of the insurance               
          proceeds, that person or entity would make payment of $190,000 to           
          Color Q, which agreed that, upon payment, it would dismiss all              
          claims against all defendants in the embezzlement suit.                     
               On May 11, 1988, in a status conference held in the Probate            
          Court of Warren County regarding the Estate, the Special                    






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