Don A. Chan and Cecilia Chan - Page 6

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            other shareholders of Shin have received dividends during that                               
            time.  In addition, Shin made large, unreimbursed distributions                              
            to Lily and distributions to satisfy Lily's contractual                                      
            obligation at a time when she owned less than 3 percent of Shin.                             
                  In 1986, Henry transferred his 18-percent share of Shin to a                           
            member of the Wan Yang Chen family, Daniel Chen (Daniel).  Also                              
            in 1986, a dispute arose between the Wan Yang Chen family and the                            
            Lily Chan family as a result of Shin's failing to pay a share of                             
            its profits to Wan Yang under a prior agreement.  In the prior                               
            agreement, it was agreed that Henry, Lily, and Wan Yang would                                
            divide Shin's profits equally among them.  However, Wan Yang                                 
            received payments pursuant to the agreement for only 1 or 2                                  
            years.  Daniel was causing problems at Shin because he felt that                             
            the Lily Chan family had acquired too many of Henry's assets to                              
            which the Wan Yang Chen family had a right.  Daniel also                                     
            improperly removed some corporate documents from Shin's office.                              
            Stanley felt that he could not handle the situation and flew to                              
            the United States to tell petitioner husband that he was                                     
            resigning.  Edward Chiu (Edward) replaced Stanley as Shin's                                  
            general manager.  Petitioner husband and Edward met in 1975                                  
            through business dealings between Eastimpex and a food supply                                
            company that Edward owned.  Petitioner husband and Edward were                               
            close personal friends.  Petitioner husband personally chose                                 
            Edward to succeed Stanley as Shin's general manager.                                         






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