Joseph D. & Elizabeth M. Dunne - Page 23




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          agreement to make a more formal agreement at a later date.  It              
          appears that Mr. Marcus attempted to memorialize this by                    
          extending a settlement offer in his January 16, 1997, letter to             
          Mr. Dunne, but Mr. Dunne did not accept that offer.                         
               The other facts and circumstances also indicate that the               
          Inverness agreement did not transfer any accouterments of owning            
          Mr. Dunne’s shares to Mr. Marcus.  While Mr. Dunne told Mr.                 
          Marcus that he could conduct business as he wished at the                   
          Inverness meeting, Mr. Marcus appears to have already had that              
          power as president of FRC.  Furthermore, Mr. Dunne was not                  
          exercising significant managerial control before 1997.  In                  
          addition, after the Inverness agreement, Mr. Dunne continued to             
          receive dividends from FRC and he continued to enjoy the benefits           
          and burdens of being a shareholder because he had not fixed a               
          selling price for his shares.  Mr. Dunne also exercised his right           
          as a shareholder to petition for appointment of a custodian for             
          FRC in a State court.  Finally, Mr. Dunne repeatedly asserted to            
          FRC and third parties that he continued to be a shareholder of              
          FRC after 1996.  Therefore, we find that Mr. Dunne retained                 
          beneficial ownership of FRC for at least part of 1997.                      
               We next consider whether the May 8, 1997, settlement                   
          agreement transferred beneficial ownership of Mr. Dunne’s stock             










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