Estate of Paul Mitchell, Deceased, Patrick T. Fujieki, Executor - Page 49

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               In particular, a hypothetical buyer or seller would have to            
          consider the following factors in valuing the 1,226 shares of JPMS          
          common stock at the moment of Mr. Mitchell's death:  (1) Whether it         
          would be necessary to increase JPMS' advertising and marketing              
          expenses;24 (2) whether litigation concerning Mr. DeJoria's                 
          compensation would ensue; (3) whether the lack of a ready or                
          available market for the stock would affect its fair market value;          
          (4) whether and how JPMS would continue its history of successful           
          product development and styling leadership; (5) whether rumors              
          concerning JPMS "going retail" would adversely  affect  its                 
          relationships with salons; (6) whether JPMS' history of unreliable          
          suppliers would continue; (7) whether JPMS would solve its                  
          inventory control and financial information reporting problems; and         
          (8) whether JPMS' thin management and total reliance on Mr. DeJoria         
          would hinder its performance.                                               
               Nonetheless, Mr. DeJoria stepped in to single-handedly run             
          JPMS upon Mr. Mitchell's death.  Mr. DeJoria had always overseen            
          JPMS' marketing.  Indeed, despite his reputation for creativity,            
          Mr. Mitchell had not succeeded in marketing his product line in the         
          late 1970's.  Although there is no doubt that Mr. Mitchell's fame           
          was an important component in launching JPMS in the early 1980's,           



               24   William E. Peplow, vice president of salon relations              
          for Redken, wrote a report and testified on petitioner's behalf.            
          He foresaw that JPMS would have to increase its advertising                 
          budget to sustain sales after Mr. Mitchell's death.                         



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