Pabst Brewing Company - Page 11

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          cash.4  At that time, JMSL was owned through a Delaware holding             
          company, PST Acquiring Corp. (PST), which was owned 50 percent by           
          the members of the Jacobs Group and 50 percent by Kalmanovitz.              
          Petitioner's shares were trading on the New York stock exchange             
          at approximately $20 per share.                                             
               In response to the Second JMSL Offer, petitioner and                   
          Heileman entered into an agreement in principle on November 5,              
          1982, as later amended on November 9 and 26, 1982 (Agreement in             
          Principle).  The Agreement in Principle was the product of                  
          arm's-length negotiations between petitioner and Heileman.  As              
          originally drafted, the Agreement in Principle contemplated the             
          following transaction:  (1) Heileman's acquisition of petitioner            
          and Olympia by way of a merger, (2) Heileman's retention of                 
          certain assets of petitioner and Olympia, and (3) a spinoff of              
          the remaining assets to a new entity of which Heileman would not            
          be a shareholder.  To effectuate the merger, the Agreement in               
          Principle provided that Heileman, through a wholly owned                    
          subsidiary, would make a cash tender offer to acquire                       
          petitioner's stock.                                                         
               On November 10, 1982, pursuant to the Agreement in                     
          Principle, Heileman commenced a tender offer (First HBC Offer)              
          through its wholly owned subsidiary, HBC Acquisition, Inc. (HBC),           

               4 The 3 million shares, when combined with the shares the              
          Jacobs Group already owned, constituted a controlling interest in           

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