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redemption agreement. See In re Estate of Spaziani, 480 N.Y.S.2d
854, 856 (Sur. Ct. 1984) (New York courts will enforce
restrictions on a shareholder’s right to dispose of his stock).
Respondent has proven no facts showing the invalidity of the 1987
redemption agreement.
E. Conclusion
We find that the 1987 redemption agreement was a valid and
enforceable contract under New York law.
III. Section 2703 Is Inapplicable
With an exception not here relevant, section 2703 provides:
(a) General Rule--For purposes of this subtitle, the
value of any property shall be determined without
regard to--
(1) any option, agreement, or other
right to acquire or use the property at a
price less than the fair market value of the
property (without regard to such option,
agreement, or right), or
(2) any restriction on the right to sell
or use such property.
Section 2703 applies to any right or restriction created or
“substantially modified” after October 8, 1990. Omnibus Budget
Reconciliation Act of 1990, Pub. L. 101-508, sec.
11602(e)(1)(A)(ii), 104 Stat. 1388, 1388-500.
Because the executors elected alternate valuation, as
provided for in section 2032, we assume that decedent’s shares
were valued for estate tax purposes as of January 28, 1991.
Respondent argues that, in valuing decedent’s shares, we should
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