Betty W. Thompson - Page 6

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          discount taken in determining the value of the Company's shares             
          when the 1986, 1987, and 1988 gifts were made to the Thompson               
          children.                                                                   
               Respondent's examining agent made his own computation of the           
          value of the Company stock.  The agent, using what he considered            
          to be a comparable publicly traded corporation, determined in his           
          report that the hypothetical market value of the Company on the             
          valuation date was $300 per share.  He then discounted that value           
          by 20 percent, or $60 per share, to reflect the lack of                     
          marketability of closely held stock.  To the discounted value of            
          $240 he applied a "control"7 premium of 20 percent, or $48, which           
          he added to the marketability discounted value of $240 to arrive            
          at a figure of $288 per share.  Finally, he rounded to the amount           
          of $285 as his proposed per-share value of the Company stock to a           
          hypothetical buyer.                                                         
               In August of 1991, Mr. Thompson engaged attorney J. Ren�               
          Hawkins (hereinafter Mr. Hawkins).  In connection with                      
          representing Mr. Thompson in the examination of the gift tax                
          return, Mr. Hawkins suggested that Mr. Thompson hire an                     
          independent appraiser to value the shares that Mr. Thompson had             
          given to the children.  Based upon this advice, Mr. Thompson                
          hired John O. Batson (hereinafter Mr. Batson) to perform an                 
          appraisal of the Company stock.                                             

               7"Control" here represents ownership of more than 50 percent           
          of the stock of a corporation by a single family.                           




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