CMA Consolidated, Inc. & Subsidiaries, Inc. - Page 115

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          of list price.  In Daley’s judgment, the value of the equipment             
          reaches “salvage value” when the equipment is “scrapped or sold             
          off to third party maintenance companies” for spare parts.                  
               Daley concluded that by May 1, 2000, with one exception, the           
          K-Mart and Shared equipment would have no estimated residual                
          value.  The one exception was a piece of photo processing                   
          equipment that Daley estimated would have a nominal residual                
          value of $194.                                                              
               Daley used DMC’s compiled computer equipment reports to                
          determine the residual values for the Shared computer equipment.            
          With respect to the K-Mart photo processing equipment, Daley                
          compiled information from a similar data base on photo processing           
          equipment.  Using a similar methodology as he used for computer             
          equipment, Daley arrived at the conclusion that the K-Mart                  
          equipment would have no residual value.                                     
               On the basis of that analysis and using a 10-percent                   
          interest or discount rate, Daley projected the future rental                
          income the K-Mart and Shared equipment would produce during the             
          master lease and over lease periods.  He projected that the K-              
          Mart and Shared equipment would produce no rental income during             
          the purported over lease.                                                   
               Daley opined that the underlying K-Mart and Shared end-user            
          lease equipment had the following fair market values as of the              
          dates specified below:                                                      






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