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MEMORANDUM FINDINGS OF FACT AND OPINION ............ 4
FINDINGS OF FACT ....................... 4
I. Decedent and BCC ..................... 5
II. 1981 Agreement ...................... 6
III. ESOP ........................... 9
IV. Life Insurance and the Death of Mr. Jennings ...... 10
V. 1996 Agreement and Redemption of Decedent’s BCC Shares . 11
VI. Estate’s Return .................... 15
VII. Expert Testimony .................... 16
A. Estate’s Expert Mr. Grizzle ............ 17
B. Estate’s Expert Mr. Fodor ............. 19
C. Respondent’s Expert, Mr. Hitchner ......... 21
OPINION ........................... 25
I. Effectiveness of the Buy-Sell Agreement ......... 25
A. Terms of the Buy-Sell Agreement .......... 28
B. Binding-During-Life Requirement .......... 33
C. Section 2703 ................... 39
1. Applicability of Section 2703 ......... 40
2. Section 2703(b)(3) .............. 46
II. Valuation of Decedent’s BCC Shares ........... 55
A. Fair Market Value ................. 55
B. Expert Testimony ................. 56
C. BCC’s Value Exclusive of Insurance Proceeds .... 58
1. Experts’ Concluded Value Exclusive of Insurance
Proceeds .................. 58
2. Mr. Fodor’s Adjustment for ESOP Repurchase
Obligation ................. 60
3. Mr. Hitchner’s Estimate of Excess Cash .... 64
4. Conclusion .................. 65
D. Effect of Redemption Obligation on Insurance
Proceeds .................. 66
E. Accounting for Insurance Proceeds ......... 75
III. Conclusion ...................... 81
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Last modified: May 25, 2011