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The district court found that the proposed $118 price failed
to compensate adequately for the Hill Rights, in particular the
FACC option. The court therefore concluded that the 1994
Agreement was not in decedent's best interest and declined to
approve it.
The 1995 Family Settlement Agreement
The conservator filed a motion for reconsideration of the
district court decision and, based on its belief that further
litigation as to either the 1991 or 1994 Agreements was not in
decedent's best interest, commenced negotiations with the
prospective heirs to obtain agreement with respect to a price at
which decedent's FABG stock could be sold.
The conservator continued to believe that it was imprudent,
and potentially a violation of its fiduciary obligations to
decedent, to continue to hold such a substantial portion of
decedent's net worth in the form of a minority interest in a
closely held bank that did not pay dividends. The conservator
likewise considered the deferred sale arrangement in the 1994
Agreement a significant benefit for decedent by virtue of the
capital gains tax savings, which might be lost were FABG to
successfully exercise any call option that might be available to
it under the 1991 Agreement. The prospective heirs other than
Rod preferred a guaranteed "floor" price for decedent's FABG
stock rather than the risks inherent in further negotiation
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