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B. Disagreement
The disagreement between the parties is over the meaning of
the requirement (sometimes, the market quotations requirement)
that “market quotations * * * [be] readily available on an
established securities market”. Petitioners argue for a “plain
language” reading of the requirement. They rely on the testimony
of their expert witness, Eugene N. White, Ph.D., who was accepted
by the Court as an expert in banking and securities markets, and
who was of the opinion that Bancorp stock was traded on the OTC
market, which is an established part of the securities market, so
that Bancorp stock “qualifies as a security that was traded on an
established securities market”. Petitioners argue that, on the
transfer date, market quotations were readily available for the
shares since, on that date, if requested, Gill & Associates could
have readily determined the book value of the bank’s assets,
which it believed to be a fair value for Bancorp’s stock.
Respondent argues that the market quotations requirement was
not satisfied because, on the transfer date: (1) Bancorp shares
did not trade on, and therefore, did not have market quotations
on, an established securities market, and (2) even if Bancorp
shares did so trade, market quotations with respect to those
shares were not readily available. With respect to whether the
shares constituted qualified appreciated stock, respondent
summarizes his argument as follows:
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