Investment Research Associates - Page 448




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          or business purpose and were only part of the transactions for               
          Federal tax purposes.                                                        
          H.   Cedilla Invest. "Dard Systems Transactions"                             
               On December 22, 1986, Cedilla Invest. purportedly purchased             
          certain IBM-manufactured computer equipment from Dard Systems,               
          Inc. (Dard), for $3,615,100.  Prior thereto, on June 29, 1981,               
          Funding Systems International had sold this equipment to                     
          Equitable Leasing Co., and on the same date, Equitable Leasing               
          Co. had leased the equipment back to Funding Systems                         
          International.  Equitable Leasing Co., on September 30, 1981,                
          sold the equipment to Dard, and thereafter Dard sold the                     
          equipment to Cedilla Invest. on December 22, 1986, subject to                
          several end user leases with various entities in England as well             
          as the lease encumbering the equipment in favor of Funding                   
          Systems International.                                                       
               The stated purchase price of $3,615,100 was, according to               
          the terms of the purchase agreement, to be paid by Cedilla                   
          Invest. to Dard as follows:  $18,000 cash payable at the time of             
          the execution of the agreement; a short-term promissory note                 
          payable on May 15, 1987, in the amount of $198,000; and a long-              
          term, "limited recourse" promissory note in the amount of                    
          $3,399,100.                                                                  
               Under the terms of the "limited recourse promissory note",              
          Cedilla Invest. was personally liable only during the times and              






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