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the value of decedent’s 43,080 BCC shares suggests that those
shares were worth approximately $6.7 million in November 1996.
Thus, the 1996 Agreement’s change in the price for decedent’s BCC
shares did not result in a change in price that more closely
approximated fair market value.
In addition to the changes in the value and quality of the
rights wrought by the change in price, the 1996 modification
worked other substantial changes to the 1981 Agreement. Under
the 1981 Agreement, the redemption price was based on book value.
Moreover, the ESOP had the right to insist on book value as the
basis for any redemption by refusing to agree to reset the price.
It further was entitled to have the price automatically adjusted
to reflect changes in book value. Decedent eliminated the ESOP’s
rights in this regard when he modified the 1981 Agreement. He
also extinguished BCC’s right to pay the redemption price in
installments, as provided in the 1981 Agreement.
We find that the foregoing changes are more than de minimis
and that they substantially altered decedent’s, BCC’s, and the
ESOP’s rights with respect to the stock covered by the agreement,
including the value, quality, and timing of those rights.
Accordingly, we conclude that the 1996 Agreement substantially
modified the 1981 Agreement. Insofar as this substantial
modification occurred after October 8, 1990, the Modified 1981
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