Hubert Enterprises, Inc. and Subsidiaries, et al. - Page 9

                                         -9-                                          
          ALSL.  During the relevant years, the owners of Sun Valley                  
          Investments, a partnership, were Thomas and Stethem.                        
               Pursuant to ALSL’s operating agreement, ALSL’s members were            
          required to contribute the following capital to ALSL:                       
                         Member               Contribution                            
                         Edward Hubert              $200                              
                         George Hubert, Jr.            200                            
                         Sharon Hubert                 200                            
                         Ollinger                       50                            
                         Stethem                        50                            
                         Sun Valley Investments        100                            
                         Thomas                        200                            
                        1000                                                         
          None of ALSL’s members, with the exception of Thomas and Stethem,           
          ever contributed any capital to ALSL from his, her, or its own              
          funds.  During 1996, Thomas and Stethem contributed $200,000 and            
          $50,000, respectively, to ALSL’s capital.4                                  
               As of December 31, 1995, ALSL reported for Federal income              
          tax purposes that it had cash of $7,298, that it owned a                    
          $1,338,334 nonrecourse note receivable from ALD, and that it was            
          liable on a $1,345,684 nonrecourse note payable to HEI.  ALSL               



               4 During HEI’s 1997 taxable year, Thomas was HEI’s most                
          highly compensated officer, and Edward Hubert, George Hubert,               
          Jr., and Sharon Hubert were its next three most highly                      
          compensated officers.  During that year, HEI paid Thomas                    
          $420,922, and it paid $370,236 to each of the other three                   
          officers.  During HEI’s 1998 taxable year, Thomas received                  
          significantly less compensation than these other three officers.            
          During HEI’s 1998 taxable year, HEI paid Edward Hubert, George              
          Hubert, Jr., Sharon Hubert, and Thomas $644,236, $894,236,                  
          $644,236, and $397,342, respectively.                                       





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