Estate of Algerine Allen Smith, Deceased, James Allen Smith, Executor - Page 10

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          beginning on the date Exxon paid the judgment in Exxon I                    
          (February 27, 1986) and continuing until the judgment date in the           
          Jarvis Christian litigation, and thereafter for postjudgment                
          interest.                                                                   
               On July 12, 1991, the executor of decedent's estate filed a            
          United States Estate (and Generation-Skipping Transfer) Tax                 
          Return (Form 706).  On the return, the entire $2,482,719 sought             
          by Exxon was deducted as a claim against the estate pursuant to             
          section 2053(a)(3).                                                         
               On September 10, 1991, the special master in the Jarvis                
          Christian litigation issued an order regarding the procedures to            
          be followed in determining the damages, if any, concerning each             
          defendant.  On September 23, 1991, the Allen parties filed a                
          response to the special master's order, wherein they objected to            
          Exxon's damage calculations.                                                
               On February 10, 1992, petitioner and Exxon entered into a              
          settlement agreement with respect to the litigation.  Pursuant to           
          the settlement, petitioner paid Exxon $421,276.60 and surrendered           
          to Exxon for a period of 7 years Frankie Allen's royalty interest           
          in the HFU, which had a fair market value of approximately                  
          $260,563.00 when assigned.  Petitioner thus resolved Exxon's                
          disputed claim for a total amount of $681,839.60.  On April 6,              
          1992, Exxon and the Allen parties filed a stipulation of                    
          dismissal.  On April 29, 1992, the District Court ordered that              






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