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lease agreement provided for no actual over lease residual
interests in that equipment. The over lease agreement set forth
a lease term for the K-Mart and Shared equipment that expired on
the same dates as the master lease respecting that equipment.7
Unlike the ultimate beneficiary in the first lease strip
deal, petitioner did not retain its lease position throughout the
life of the over lease in the second lease strip deal. Instead,
petitioner disposed of its lease position and/or the associated
equipment installment note in three transactions with other
entities over a 21-month period running from November 27, 1995,
through September 1, 1997.
As to the second lease strip deal, the following complex
series of multiparty equipment purchase, lease, and other
transactions took place on August 31, September 1, September 28,
and November 27, 1995; and on October 31, 1996, and September 1,
1997.
7As discussed supra, the master lease ran: (1) From Nov. 1,
1994, through Oct. 31, 2002, in the case of the K-Mart Corp. (K-
Mart) end-user lease equipment, and (2) from Nov. 1, 1994,
through Apr. 30, 2000, in the case of the Shared Medical System
Corp. (Shared) end-user lease equipment. As discussed more fully
infra, the Aug. 31, 1995, over lease agreement provided that the
over lease ran: (1) From Aug. 31, 1995, through Oct. 31, 2002,
in the case of the K-Mart end-user lease equipment, and (2) from
Aug. 31, 1995, through Apr. 30, 2000, in the case of the Shared
end-user lease equipment. Accordingly, petitioner had no
residual lease interests in that equipment.
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