Wallace R. Noel and Robinette Noel - Page 16

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          both to purchase his stock and to settle his claims.  Accord-               
          ingly, we must allocate the $3,250,071 between the value of the             
          stock in PMI and the value of settling petitioner's claims.                 
               It would serve no purpose to delve into detailed discussions           
          concerning the weight of specific testimony or the credibility of           
          certain evidence.  We make this allocation based on the totality            
          of the evidence before the Court, while allowing for a certain              
          amount of overstatement, or understatement, in the assertions               
          contained in the testimony before us.  See Eisler v. Commis-                
          sioner, 59 T.C. 634 (1973).  Therefore, based on the evidence, we           
          conclude that PepsiCo paid $2,363,688 for the PMI stock, or $6              
          per share.  Consequently, we find that the remainder of the                 
          amount paid to petitioner by PepsiCo, an amount equal to                    
          $886,383, was paid to settle petitioner's claims in contract and            
          in tort.                                                                    
               To exclude under section 104(a)(2) the proceeds from the               
          settlement of a claim, the claim (1) must be based on tortlike              
          rights and (2) must be "on account of" personal injuries.  Com-             
          missioner v. Schleier, 515 U.S. __, 115 S. Ct. 2159 (1995).                 
          Petitioner's first two claims against PepsiCo constitute contract           
          claims not covered by section 104(a)(2).  Petitioner's third                
          claim is an action in tort.  See Maxwell v. Southwest Natl. Bank,           
          593 F. Supp. 250, 253 (D. Kan. 1984); Turner v. Halliburton Co.,            
          722 P.2d 1106, 1115 (Kan. 1986).  Further, we are satisfied that            
          petitioner suffered personal injuries.  The phrase "on account of           

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