Estate of Eugene E. Stone, III, Deceased, C. Rivers Stone, E.E. Stone, IV, Mary Stone Fraser & Rosalie Stone Morris, Co-Personal Representatives - Page 5

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          operations.  Because those operations were in such close proxim-            
          ity to the Cherrydale residence, Mr. Stone and Stone Manufactur-            
          ing decided that that residence could serve as a place to house             
          out-of-town business visitors to its facilities.  To that end, in           
          late summer 1995, renovation work commenced on the Cherrydale               
          residence and was completed in the fall of 1997.  During that               
          renovation, the Cherrydale residence was uninhabitable.                     
               In 1976, Mr. Stone formed Stones, Inc., as a holding company           
          of Stone Manufacturing and owned 100 percent of the common stock            
          of that holding company.  (For convenience, we shall sometimes              
          refer to Stones, Inc., and Stone Manufacturing, separately and              
          collectively, as the Company.)  From 1976 until April 1997, Mr.             
          Stone owned a preferred stock interest in Stones, Inc.                      
               On December 30, 1976, Mr. Stone made a gift of 2,250 shares,           
          or 50 percent, of the common stock of Stones, Inc., to each of              
          two trusts (collectively, the trusts) that he established, one              
          for the benefit of his children and one for the benefit of his              
          grandchildren.  At the time the trusts were formed, Stones, Inc.,           
          owned 83.4 percent of the common stock of Stone Manufacturing.              
          At that time, C. Rivers Stone, who became president of Stone                
          Manufacturing shortly before Mr. Stone established the trusts,4             

               4C. Rivers Stone, who as a teenager began working for Stone            
          Manufacturing during the summers, remained president of Stone               
          Manufacturing until around 1999 when he stopped working for the             

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