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raised by the estate as to facts concerning Sterling's redemption
of the Sterling preferred stock. Respondent argues that the
January 17, 1994, redemption of the Sterling preferred stock sets
the stock's fair market value on the applicable valuation date.
Respondent contends that the stock's fair market value totals
$1,947,845, an amount that respondent derives from adding the
redemption price of $1,533,482 to the $414,363 amount that was
paid for "interest".
The estate argues that facts concerning the redemption are
irrelevant to our determination. The estate claims that the
redemption was not foreseeable on the applicable valuation date
of September 18, 1992, given Sterling's questionable financial
condition and its failure to meet redemptions which were
scheduled, but not made, before that date. The estate points to
the purchase agreement, under which Sterling could not redeem any
of the Sterling preferred stock, or pay any dividends with
respect thereto, if the redemption or payment would violate the
terms of the senior debt or occur during any period of default on
senior debt. The estate also observes that Sterling had forgone
partial redemptions in 1991 and 1992.
We disagree with the estate that facts concerning the
redemption are irrelevant to our determination of value.
Although these facts may not necessarily set the fair market
value of the Sterling preferred stock on the applicable valuation
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