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and Eastern I don't think it is a fair situation as far as Colonial stockholders are concerned. You mention about the the stock market-wise. Let us assume that back in #52, with National's offer at seven for eight and the stockholders turning it down, if it has been approved at that time the National stock today that the Colonial stockholders would have acquired that time to [[uld?]] have been in excess of $60 a share rather than 48 that Eastern is offering right now. But if you took the value of National today at 17 and the book value of Eastern at 23 -- DR. HOSS: If you have a house that somebody offers you $50.000 for and a year or two later you want to sell it, and you know that you have got to sell it, you can't go out and say "I won't consider anything less than $50.000." If no one will give you $50.000, you will sell at $30.000. MR KURLAND: What I am saying is that Eastern is taking advantage of the situation. They know Colonial is in a very poor financial position and therefore they saw fit to change their offer to us because they had no alternative but to accept that offer. MR. SKOGLUND: Aren't you presuming that our holding off will get a better offer? It is likely that we will get a poorer offer. MR. KURLAND: I understand the future prospect of Colonial by themselves independent of any other line — that the future prospects are very good for Colonial providing you can get the proper equipment. MR. SKOGLUND:As as stockholder, I wouldn't look very favorably on the outlay of additional capital, on the capital structure for equipment, and I believe the majority of stockholders of Colonial feel that way. MR. KURLAND: How much do you think Colonial stock will be worth if these CAB hearings are prolonged for another year? DR. HOSS: I think if it is turned down, it will be very likely drop from 20 to 10. It is very likely if that merger is turned down. MR. SKOGLUND: Then we are in a position where Eastern will go back and say "We will take four Colonial for one of ours." and National, too. MR. KURLAND: I have been with Colonial for quite a stretch of time, and I haven't gotten any return on my money. When the time came that I could make an appreciation on it, Eastern saw fit to take it away. They are taking 90,000 shares of Eastern stock from Colonial stockholders. That is $42 million; that is a lot of money. That is $1 1/4 million in additional dividends, so that the stock will appreciate. How do we know Eastern won't cut back the 50¢ dividend again? We have no guarantee of that. MR. SKOGLUND: You have no guarantee of anything. MR. KURLAND: The way Eastern handles things, I wouldn't be surprised if they did cut it back to 50¢. They have a reputation of being conservative and personally I think it was just a maneuver to get that 90,000 shares. MR. SKOGLUND: I think as long as the CAB is in existence there will be nothing of that sort transpiring. MR. KURLAND: Taling [[Talking]] about CAB's opinion, I happen to have read the brief and it seems to me that there was no definite price set on any airline stock. You can't determine what the actual cash value is so they went ahead and figured on the basis of future participation in the surviving company. Now, with the original offer of two for three, Colonial, I believe, would have a participation of about 13% or 14% in the future operations of the merged company, and now with this setup they only have 8% participation. MR. SKOGLUND: I am making only an opinion, but I think if you turn this one down, we will be in a poorer position, constantly putting ourselves in a poor bargaining position. MR. KURLAND: Either we will be in a poor position -- because from my experience with the the proceedings going on, CAB is not ready to hand down a decision. They are going to take their time on it. This decision we got last March, in my opinion, could have been handed down a year before that or six months, but they don't seem to be in any particular hurry. Despite the fact that it will save the government something like a million dollars in subsidy they are not in a hurry, so why believe that they will be any quicker now in handing down this decision on the present situation? MR SKOGLUND: I don't think that is it, but getting out of a situation that we are in now. MR. KURLAND: If you approve it, it won't mean it is going to be effective. MR. SKOGLUND: I don't think that is the point. MR. KURLAND: Did you ever try to get rid of a block of Colonial stock? MR. SKOGLUND: It is not easy. MR. KURLAND: you're telling me? I think all negotiatons were based on future participation rather than market value, because the old adage still holds good that figures can lie and liars (11)