Estate of Duane B. Farnam, Deceased, Mark D. Farnam, Personal Representative, and Estate of Lois L. Farnam, Deceased, Mark D. Farnam, Personal Representative - Page 3

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               For many years, decedents owned and (with other members of             
          the Farnam family) managed Farnam Genuine Parts, Inc. (FGP), a              
          Minnesota corporation.  Prior to its incorporation in 1981,                 
          decedent Duane B. Farnam owned and operated the business as a               
          sole proprietorship.                                                        
               Throughout its existence, FGP operated retail and wholesale            
          stores in Minnesota, North Dakota, and South Dakota that sold               
          automobile parts, retail and wholesale, to individuals, farms,              
          tire stores, automobile repair shops, gasoline service stations,            
          and construction and industrial companies.                                  
               Starting in 1981 and every year thereafter, members of the             
          Farnam family, including decedents, and entities owned by members           
          of the Farnam family lent funds to FGP.  FGP used the borrowed              
          funds in its business operations.  Over the years, to                       
          substantiate and to document the loans, FGP issued promissory               
          notes (FGP notes) in favor of the Farnam family members and                 
          related entities from whom the borrowed funds were received.                
               The FGP notes were unsecured and subordinate to claims of              
          FGP’s outside creditors.  Initially, FGP paid principal but not             
          interest on the borrowed funds, but from 1984, in response to new           
          tax laws, FGP made annual payments of principal and interest on             
          the FGP notes.  The parties stipulate that the FGP notes are to             
          be treated as legitimate and enforceable FGP debt obligations.              

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Last modified: March 27, 2008