Estate of Harriet R. Mellinger, Deceased, Hugh V. Hunter and Wells Fargo Bank, Co-Executors - Page 32




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               The sale of FOH stock by the Harriett trust to the FOH ESOP            
          for a price of $4.20 per share, which represented a discount of             
          30 percent from its then-closing price on the NYSE, occurred                
          9 months after the valuation date.  Respondent argues that this             
          was not a sale to a third party, so it should not be taken into             
          consideration in valuing the stock.  In any event, this sale was            
          of class A capital stock after the amendment to the articles of             
          incorporation that altered the capital structure of FOH.  After             
          the amendment, there were two classes of stock, one with voting             
          rights and the other without.  Neither party addressed how this             
          fact affects the valuation.  Thus, we are cautious in assigning             
          weight to this transaction.                                                 
               The market transaction in which the Harriett trust sold                
          29,500 shares of FOH stock at $4.875 per share on February 18,              
          1994, does not support petitioner's contentions, because those              
          shares sold for the undiscounted price at which the stock was               
          trading on the NYSE on that day.                                            
               On the record before us, we are satisfied that the                     
          respective discounts as determined by the experts set the                   
          appropriate range from which we may determine the marketability             
          discount.  We also conclude, however, that each expert excluded             
          information that contradicted his result.  Only Cotler addressed            
          the specifics of FOH's financial situation in detail, but he                
          relied on mean discounts without relating them to those details.            





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