H & A International Jewelry, Ltd. - Page 7

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          brings them back himself. Regardless of the means of                        
          transportation, all stones are insured during travel.                       
               Mr. Frank joined the jewelry industry in 1973, working for             
          Citizens Jewelry Company and D. Geller & Sons before operating              
          his own partnership, Diamond Industries, from 1979 to 1985.  He             
          has worked for petitioner for over 5 years.                                 
          About 45 percent of petitioner's purchases are made within                  
          the United States.  Domestic purchases are often made by                    
          telephone and are delivered by armored division, registered mail,           
          or commercial carriers, depending upon the size of the order.               
               The $600,000 Red Diamond Transaction                                   
               In 1991 petitioner took an order from a customer for an                
          extremely rare .70 carat red diamond.  Mr. Haviv located and                
          purchased the diamond for $56,000. After Mr. Haviv transported              
          the diamond into the United States, petitioner's salesperson,               
          Beth Leamon, sold it for $600,000.  Her bonus that year was                 
          $16,105.                                                                    
               Dangers of the Business                                                
               Mr. Haviv has encountered increased dangers by working                 
          overseas.  For instance, an individual was killed at the Tel Aviv           
          diamond exchange, and Mr. Haviv was near an airport bombing in              
          France.  Mr. Haviv carries a gun in countries where it is legal,            
          including the United States.  Even when Mr. Haviv travels in                
          nearby Atlanta, his work places him at a special risk.                      
          Petitioner asserts that part of Mr. Haviv's compensation is for             




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