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Respondent's Expert
Respondent's expert, Richard L. Davis, a chartered financial
analyst, is the managing director and senior vice president of the
corporate finance department of Southwest Securities, Inc., an
investment banking firm6 and a member of the NYSE. Mr. Davis has
a master's degree in business administration, concentrating in
finance. The majority of Mr. Davis' assignments over the years
have involved securities of publicly traded companies or publicly
traded issues of privately held or previously privately held
companies.
Mr. Davis opined that a 3.3-percent blockage discount is
appropriate. When applied to the agreed $15.125 per-share price
(the weighted average mean per-share market price of the stock),
the 3.3-percent blockage discount results in a $14.625 per-share
valuation or a $4,102,414.88 total value.
Mr. Davis determined that market activity in the Applied Power
stock on or about the valuation date was free from abnormal factors
and influences; thus, he concluded that the trading prices for
Applied Power's stock were representative of the stock's fair
market value. Mr. Davis felt that this conclusion was buttressed
by the fact that ultimately most of the Trust's Applied Power stock
6 As an investment banker (with over 21 years
experience), Mr. Davis' work is primarily performed in three
areas: (1) Raising capital through public offerings and private
placements; (2) representing buyers and sellers of companies in
mergers and acquisitions; and (3) providing financial advisory
services, valuations, and expert testimony in investment banking
transactions.
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