Michael Hillyer and Teresa Hillyer, et al. - Page 7

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          desired replacement properties); in fact none were asked, and               
          none were performed.                                                        
               On September 20, 1991, the corporation notified the Citizens           
          National Bank, as escrow agent, of the designation of three                 
          properties which the corporation intended as replacement                    
          properties for the purposes of section 1031(a)(3).  These                   
          properties were designated as the "McClure quarries in Tennessee            
          Township, Colchester, Illinois," which were not acquired by the             
          corporation; the Coggeshall property; and "property zoned M-2               
          located south and east of Route 41 in Galesburg Township, Knox              
          County, Illinois" (owner and size not specified).                           
               On January 30, 1992, the corporation, Scott Coggeshall, and            
          the Coggeshall Co. executed a purchase agreement (Coggeshall                
          purchase agreement) with respect to the Coggeshall property for a           
          total purchase price of $577,370, including $321,000 for the real           
          estate owned by Scott Coggeshall and the asphalt plant located              
          thereon owned by the Coggeshall Co. and $256,370 for other                  
          miscellaneous equipment, including the asphalt plant owned by the           
          Coggeshall Co., but located on land owned by Collins.  Payment              
          for this purchase was accomplished by an immediate payment of               
          $300,000 at closing to the sellers, as a downpayment, with the              
          $277,370 balance to be payable over 4 years.  This arrangement              
          for deferred payment was solemnized by a second escrow agreement            
          established by the parties with the Citizens National Bank of               
          Macomb.  The Coggeshall property was to be held by the                      




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