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independent advice regarding buy-sell terms is not essential to
showing that an agreement is a bona fide business arrangement and
not a testamentary device. We agree that such a showing is not
crucial to proving petitioners’ case. As previously stated, the
presence or absence of any particular factor is not dispositive
on the question of testamentary intent. However, lack of
independent representation among related parties to a buy-sell
agreement reasonably suggests less than arm’s-length dealings.
See Lauder II.
c. Enforcement of Buy-Sell Agreement Provisions
Courts have found the lack of enforcement of buy-sell
provisions at the death or withdrawal of a party to evidence a
testamentary purpose for the buy-sell arrangement. See, e.g.,
St. Louis County Bank v. United States, 674 F. 2d at 1211.
However, the record in the cases at hand indicates that the True
family generally complied with the terms of the buy-sell
agreements, or executed formal waivers when circumstances made it
44(...continued)
identical agreement with unrelated parties in the place
of Leonard and Ronald, they would have been motivated,
by virtue of their advanced age, to negotiate a formula
ensuring as high a price as possible for their shares
balanced against their desire to maintain continuity of
management and control.
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