JIANGSU TONGLI Assets 3,658,000 USD

50,000 m2
Sales Growth 15% a year
System Borrowed Cash
Cancelable Non Cancelable
Operating Financial Capital
Lease Lease
PSAK RULES Lease Term 75% The Economic
Life of The Property
PV 90% The Beginning of Assets
Indonesia Inflation 5.67%
Condition TargeT INF 5%
SBI 6.50%
Devisa 91,799,000,000 USD
Lending rate` 13% 15%
Wanditex Sales Growth 40% in 2011

system Manufacturer Purcahse Price Annual Lease Expense

759000 perunit 170000
737000 perunit 163000
715000 perunit
Guaranteed Residual Value
15%
24%
EXHIBIT 1 WANDITEX Income Statement (Rp.million)
2009 2008 2007
Sales 57632.7 57547.7 43252.2
Other Income 998.5 697.6 967.7
Gross Income 58631.2 58245.3 44219.9
COGS 42507.6 42344.3 32501.6
Selling, general, & adm 4362.4 3621.5 3563.2
Research & Dovelepment 1377.3 1287.3 906.4
Interest 8406.2 8725.9 2700.2
TOTAL EXPENSE 56653.5 55979 39671.4
Income Before Tax 1977.7 2266.3 4548.5
Taxes 969 1110.5 2228.8
Net Income 1008.7 1155.8 2319.7
 2009 2008
Assets
C.Assets
Cash&Temp Investment 2991.8 2726.3
AR 4779.1 3730.7
Inventories 30018 32310.1
Prepaid Expenses 1392.8 1336.2
TCA 39181.7 40103.3
Property, Plant, and Equipment
Land 224.5 224.5
Buildings 3065.4 3022.9
Machinery & Equipment 2693.2 2124.4
Furniture and Fixtures 168.3 152
Construction in Progress 166.8 88.5
6318.2 5612.3
Less Accumulated Depreciation 1263.4 826.7
Net Property, Plant, and Equipment 5054.8 4785.6
Other Assets 64036.9 64833.9
Total Assets 108273.4 109722.8

Liabilities and Stock Holder

Equity
Current Liabilities
Long term debt 59.2 56.3
AP 5235.5 3876
Note Payable 475 576.4
Accrued Compensation
3962.7 4385.5
Interest and Other Liabilities
Deposits and progress Payments 14696.4 16094.6
Total Current Liabilities 24428.8 24988.8
Longterm notes payable to bank 64663.3 67122.5
Deffered Income Tax 4266.1 4149.8
68929.4 71272.3
Common Stockholder Equity
Common Stock 338.5 302.7
Capital in Excees of Par Value 7408.1 6977
Retained Earnings 7201.7 6215.6
Less Common Stock in Treasury -33.1 -33.6
Total Stockholder Equity 14915.2 13461.7
Total Liabilities and Stockholder equity 108273.4 109722.8

Number of shares of common stock 1000000

Market Price 31 Dec 2009 300
Payment in arrears
Equipment cost 715000
Cash Down Payment
Loan Amount 715000
Lease Annual Payments
5 Year net lease (in advance)
Leasing Option#1 155040
Leasing Option#2 160003
Leasing Option#3 162350
Leasing Option#4 164760
Both Methods
Guaranteed Residual Value
(required by Tongli Equipment Finance Division) 11.2729%
Investment Tax Credit 0%
Depreciation 5 MACRS
Tax Rate 34%
Pretax Interest Rate 9.50%
Equipment Cost 715000
Lease Payments 160003

Year Interest Payment After Tax Principal Payment 5 Year MACRS Rate
0
1 44831 118287 20%
2 37414 129524 32%
3 29293 141829 19.20%
4 20400 155303 11.52%
5 10663 170057 11.52%
Sum 142601 715000 94.24%
NPV

Calculation of Residual Value Cash Flow Calculation Tax Expense

Equipment Cost 715000 Market Value
Residual Value 11.2729% Less net book value
Residual Value Proceeds 80,601 Gain on Sale
Less: Tax Expense 13,402 Tax Expense
Residual Cash Flow 67,199
Calculation of Net Book Value
Equipment Cost
Depreciation Before Tax
Net Book Value
 LOAN LEASE
Depr Before Tax Depr. Tax Saving Residual Cash Flow After Tax Cash Outflow Cash Outflow
0 105602
143000 -48620 114498 105602
228800 -77792 89146 105602
137280 -46675 124447 105602
82368 -28005 147698 105602
82368 -28005 -67199 85515 0
673816 -229097 -67199 561304 528010
469273 469273

80,601
41184
39417
13,402

et Book Value
715000
673816
41184
Year Lease Payment Tax Forgone tax saving Forgone Residual Value After Tax
0 -105602
1 -105602 -48620
2 -105602 -77792
3 -105602 -46675
4 -105602 -28005
5 0 -28005 -67199
sum -528010 -229097 -67199
IRR
Initial Purchased Price Lease Payment Less Incremental CF
715000 609398
-154222
-183394
-152277
-133607
-95204
715000 -109306
6.27%
Scenario A B C D
Effective Tax Rate 34% 34% 0% 0%
Pretax Cost of Debt 9.50% 13% 9.50% 13%
After Tax Cost Of Debt 6.27% 8.58% 9.50% 13%
NPV of Loan (Borrow & Buy) 469273 484546 663800 671253%
IRR of Loan (Borrow & Buy) 6.27% 8.58% 9.50% 13%
Leasing Option #1 155,040 155,040 155,040 155,040
NPV of Leasing Option #1 454,717
IRR of Lease 5.32%
Lease Advantage over Borrowing 14556
Leasing Option #2 160003 160003 160003 160003
NPV of Leasing Option #2 469273
IRR of Lease 6.27%
Lease Advantage over Borrowing 0
Leasing Option #3 162350 162350 162350 162350
NPV of Leasing Option #3 476156
IRR of Lease 6.72%
Lease Advantage over Borrowing -6883
Leasing Option #4 164760 164760 164760 164760
NPV of Leasing Option #4 483225
IRR of Lease 7.19%
Lease Advantage over Borrowing -13952
SHIMA SEIKI
NPV of Loan
NPV of Lease
IRR of Lease
Lease Advantage over Borrowing
MARUI TEXTILE MACHINERY
NPV of Loan
NPV of Lease
IRR of Lease
Lease Advantage over Borrowing
Project 1 2 3
Hotel Acquisition Automation Existing Plant Marketable Securities
Investment
Property/ Machinery 45 35.8 15
Working Capital 15 7.5
Year Expected Free Cash Flow
0 -25 -45 1.88
1 -30 3 2.25
2 8.5 5 -15
3 9.5 7 2.63
4 10.5 9 3
5 11.5 11 3.38
6 12.5 13 3.75
7 13.5 15 2.25
8 14.5 17 2.25
9 15.5 19 2.25
10 16.5 21 2.25
Undiscounted Sum 57.5 75 10.89

Max Payback Accepted 6 5 5

Minimum Accepted Ror 12% 11.30% 10%

NPV at