Conrad Janis and Maria G. Janis - Page 5

                                        - 5 -                                         
               underlying basis for the attached appraisal.  We have                  
               valued these works of art on an individual basis as of                 
               the relevant valuation date.                                           
                    Furthermore, we have not taken into account any                   
               dealer’s discount.  It is common practice in the trade                 
               for a gallery to sell a work to another dealer at a                    
               discount ranging as high as 40% off the value in the                   
               retail market and, more commonly, in the one third                     
               range, so that the dealer may make a profit on resale.                 
                    Lastly, we have not undertaken to determine the                   
               value of the Gallery as a whole.  * * *                                
          Based upon its review, Sotheby’s determined that the undiscounted           
          value of the collection was $25,876,630.                                    
               Sidney’s estate determined the discounted value of the                 
          collection by first applying a discount totaling $4,059,540 to              
          account for the large number of works in the collection by Jean             
          Arp, Louis Michel Eilshemius, Auguste Herbin, Morris Hirshfield,            
          Piet Mondrian, Grandma Moses, and Kurt Schwitters.  This discount           
          had been recommended by Sotheby’s.  Next, a $350,000 discount was           
          applied to account for the gallery’s partial interest in three              
          works of art in the collection.  A $2,862,279 discount was then             
          applied to account for the portion of the collection that would             
          likely be sold in the dealer market (as opposed to the retail               
          market).  Finally, a $6,201,604 discount was applied to account             
          for (1) the inability to sell the gallery in the retail market              
          for individual works of art, (2) the gallery buyer’s not paying             
          the full resale price of the underlying assets acquired in the              








Page:  Previous  1  2  3  4  5  6  7  8  9  10  11  12  13  14  15  16  17  18  19  20  Next

Last modified: May 25, 2011