Estate of Mary D. Maggos - Page 39

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               In calculating the value of the operating business, CFC                
          found the compensation paid to Nikita Maggos to be reasonable and           
          therefore made no adjustment to the company’s cash-flows in that            
          regard.  Respondent’s expert noted that a new owner of 56.7                 
          percent of PCAB would be entitled to review and set the                     
          compensation of the executives.  We agree with that proposition.            
          Respondent’s expert estimated that an appropriate level of                  
          compensation for the position held by Nikita Maggos would be in             
          the vicinity of $100,000 per year.26  Based on PCAB’s size,                 
          revenue, profits, and dividend history, we agree that this amount           
          is more reasonable than Nikita Maggos’ salary of over $250,000.             
          A majority owner of PCAB stock, other than Nikita’s mother, would           
          not likely approve of Nikita’s salary level.  As a consequence,             
          we have adjusted the cash-flow in CFC’s calculation to account              
          for this fact.                                                              
               Additionally, we have adjusted the CFC’s calculation of the            
          value of the nonoperating assets in the same manner as was done             
          in the discounted cash-flow analysis of respondent’s expert and             
          for the same reasons.  The result of the adjustments yields a               
          value for 100 percent of PCAB of approximately $8,600,000 and of            
          $4,900,000 for 56.7 percent.                                                

               26Petitioner’s amended complaint in the District Court                 
          litigation alleged that Nikita Maggos, an officer and director of           
          PCAB, caused PCAB to pay to him a salary which was excessive and            
          not reasonable.                                                             

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