Ronald I. and Lois B. Koenig - Page 5

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          under which Harmony Foods purchased all of the assets of                    
          Washington Chocolate and certain other specified assets of                  
          petitioner.  Harmony Foods' primary interest in this transaction            
          was obtaining Washington Chocolate's customer base.                         
               Pursuant to paragraph 2.1 of the purchase agreement, Harmony           
          Foods paid $600,000 to Washington Chocolate for its assets and an           
          additional $71,000 to petitioner for those assets he owned                  
          personally.  Paragraph 10.4 of the purchase agreement provided              
          that as a condition precedent, petitioner was to execute an                 
          employment agreement with Harmony Foods.  Consistent with the               
          requirements of paragraph 10.4 of the purchase agreement,                   
          petitioner entered into an employment agreement with Harmony                
          Foods on May 26, 1989, which provided for the employment of                 
          petitioner by Harmony Foods.                                                
               Paragraph 2 of the employment agreement defined petitioner             
          as an at-will employee.  Paragraph 3 of the employment agreement            
          defined the term of employment as commencing on the date of                 
          signing the employment agreement and continuing until either                
          party terminated the employment agreement with 30 days' written             
          notice.                                                                     
               Paragraph 4.A of the employment agreement provided                     
          petitioner with an annual base salary of at least $100,000.  As             
          additional compensation, paragraph 4.B of the employment                    
          agreement provided petitioner with a commission over a 7-year               





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