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DGA stock was $751 per share on November 29, 1999, and $801 per
share on November 29, 2000.
2. Whether the value of each 1999 note was $2,232,000, as
petitioner contends, or $1,687,704 as respondent determined. We
hold that it was $1,687,704.
Unless otherwise specified, section references are to the
Internal Revenue Code as in effect for 1999 and 2000, and Rule
references are to the Tax Court Rules of Practice and Procedure.
FINDINGS OF FACT
Some of the facts have been stipulated and are so found.
A. Petitioner
Petitioner resided in Whitehouse, New Jersey, when he filed
the petition in this case. He was 84 years old at the time of
trial.
B. Dallas Group of America
1. Reagent Chemical & Research., Inc.
In 1959, petitioner and Thomas Skeuse (Skeuse) formed
Reagent Chemical & Research, Inc. (Reagent), in Texas. Reagent
initially processed elemental sulfur and later distributed
hydrochloric acid. In the 1970s, Reagent expanded into the
ammonium chloride and magnesium silicate businesses.
2. Formation of Dallas Group of America, Inc.
In February 1989, petitioner and Skeuse decided to split
their interests in Reagent. Reagent spun off its ammonium
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