Margaret Merriweather owns 91% of Merriweather Enterprises, Inc. (ME).ME has 1 class of stock issued and outstanding.Margaret is the President of ME and is also the director of the board.The other three board members are her three adult children, Michael, Michelle and Mary each of whom own 3% of ME.The children's stock was given by Margaret over a period of five years when the children were born.Each child is at least 30 years old.Margaret decided in 2011 that she wanted to retire and transfer the management and control of ME to her children.You advised Margaret to make a gift of some of the ME stock to each child in late November 2011.In early December 2011 Margaret, under your advice, had ME redeem her remaining shares of ME for cash and a promissory note.The redemption price was determined by an independent, third party appraiser.The note will be paid in monthly installments of principal and interest that began in January 2012.The interest rate on the note is within market rates.

Why did you advise Margaret to give each child some stock.

Does the redemption, taking into consideration only the facts stated above, qualify for CG treatment for Margaret?