Estate of Wayne C. Bongard, Deceased, James A. Bernards, Personal Representative - Page 1

                                   124 T.C. No. 8                                     

                               UNITED STATES TAX COURT                                

                            REPRESENTATIVE, Petitioner v.                             
                    COMMISSIONER OF INTERNAL REVENUE, Respondent                      

               Docket No. 6141-03.               Filed March 15, 2005.                

                    In 1980, D incorporated Empak, Inc.  In 1986, D                   
               established an irrevocable stock accumulation trust (ISA               
               Trust) and funded it with some of his Empak stock.  In the             
               mid-1990s it was determined by Empak’s board of directors              
               and advisers that pooling all of D’s family’s Empak stock in           
               a holding company, WCB Holdings, LLC. (WCB Holdings), would            
               better position Empak for a corporate liquidity event, which           
               was necessary to raise capital and remain competitive.  On             
               Dec. 28, 1996, D and ISA Trust capitalized WCB Holdings by             
               transferring to WCB Holdings their respective shares of                
               Empak stock, and in exchange received WCB Holdings class A             
               and class B membership units.  Each class of membership                
               units was further divided into governance and financial                
               units, the class A governance units being the only units               
               with voting rights.                                                    
                    On Dec. 29, 1996, D and ISA Trust formed the Bongard              
               Family Limited Partnership (BFLP).  To capitalize BFLP, D              
               transferred all of his WCB Holdings class B membership units           
               to BFLP in exchange for a 99-percent limited partnership               

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