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counsel2 by Howard Frazier Barker Elliott, Inc. (HFBE). That
report (the 1996 HFBE appraisal report) concludes that, taking
into account discounts for lack of control and lack of
marketability, the fair market value of a 1-percent “assignee’s
interest in the Class B Limited Partnership Interests” on the
valuation date was $89,505.
Representatives of CFT and the symphony, respectively
(including their respective outside counsel), reviewed the 1996
HFBE appraisal report and determined that it was not necessary to
obtain their own appraisals. Furthermore, under the terms of the
confirmation agreement, CFT and the symphony (as well as the
other assignees) agreed not to seek any judicial alteration of
the allocation in the confirmation agreement and waived their
arbitration rights granted under the assignment agreement.
MIL’s Exercise of the Call Right
On June 26, 1996, MIL exercised the call right with respect
to the interests held by the symphony and CFT. It did so
pursuant to a document styled “Agreement-–Exercise of Call Option
By McCord Interests, Ltd., L.L.P.” (the exercise agreement). The
purchase price for the redeemed interests was based on a two-page
letter from HFBE (the HFBE letter) previewing an updated
appraisal report to be prepared by HFBE. The HFBE letter
2 The children’s counsel had also represented petitioners
in connection with the transaction. However, petitioners were
not involved in the allocation of the gifted interest among the
assignees pursuant to the confirmation agreement.
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