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of a memorializing document was intended to be a mere formality.
The settlement date was anticipated to be no more than 8 days
after the signing of the agreement and there were no contract
terms left to be decided on the settlement date, which suggests
that the memorializing document would not contain any terms
additional to or different from those contained in the settlement
agreement. Furthermore, the arbitrator found the settlement
agreement sufficiently definite to order the parties to comply
with its terms in the arbitration award without requiring the
parties to draw up a new memorializing document. Therefore,
while under the terms of the settlement agreement Mr. Dunne had
the right to retain legal title of his stock until the settlement
date, the fact that the settlement agreement gave Mr. Marcus the
right to legal title upon the satisfaction of certain conditions
is a stronger indicium of beneficial ownership. See id. at 874.
Similarly, the fact that the settlement agreement gave Mr.
Dunne a contractual right to obtain $175,000 and his share of the
halon contract from Mr. Marcus as consideration for his shares
weighs in favor of petitioners. We have recognized that a
transfer of beneficial ownership can occur before the entire sale
price has been paid. See Pacific Coast Music Jobbers, Inc. v.
Commissioner, 55 T.C. 866 (1971).
The next factor we consider is whether Mr. Dunne continued
to enjoy the economic benefits and burdens of being a shareholder
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