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Home My WebLink About01-0699 --<"'-"'.-' .. I Date I Prepared By Register of Wills of Cumberland County, Pennsylvania PETITION FOR GRANT OF LETTERS E~~e~ 1. Paul Sha~~ett6 also known as No. 21-01-699 :.i. " ,Deceased Social Security No.2 0 9 - 1 2 - 8 9 9 0 (COMPLETE -A- OR -B- BELOW:) o A. Prot)ate and Grant of Letters and aver that Petitioner(s) is/are the execut Q" s named in the Last Will of the Decedent, dated Au u 6 t 8 , and codicil(s) dated 0ds/'. u 0 3 6(). Except as follows, Decedent did not many, was not divorced, and did not have a child born or adopted after execution of the documents offered for probate; was not the victim of a killing and was never adjudicated incompetent: o B. Grant of Letters of Administration Petitloner(s) after a proper search haslhave ascertained that Decedent left no Will and was survived by the following spouse (if any) and heirs: Name Relationship Residence (COMPLETE IN ALL CASES:) Attach additionaJ sheets, if necessary. Decedent was domiciled at death in Cumberland County, Pennsylvania, with his/her last family or principal residence at 21 Devon6h-i~e Squa~e, Mechan-ic6bu~q, PA 17055 Decedent, then ..l1- years of age, died ] u l fJ 4. 2 0 0 1 J at H (J R y S r j /7 j t H {J ;.. .n j taP Fa 6 t Penn6bo~o Town6h-ip Decedent at death owned property with estimated values as follows: (If domiciled in PA) All personal property - - - - - - - - - - - - -$ 2,000,000.00 (If not domiciled in PA) Personal property in Pennsylvania - - - $ (If not domiciled in P A) Personal property in County - - - - - - - -$ Value of real estate in Pennsylvania - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - $ 1 20, 000. 00 Toml-----------------------------------------------$2, 120,000.00 Real Estate situated as follows: 21 Devon6h-i~e Squa~e, Mechan-i c6bu~q, PA 1 7055 Wherefore, Petitioner(s) respectfully request(s) the probate of the last Will and Codicil(s) presented with this Petition and the grant letters in the appropriate fonn to the undersigned: -"..",--- Signature Typed or printed name and residence 811 H-i hland Co~t Mechan-ic6b~g, PA 17050 -iitt, PA 1/011 RW-7 r~~-6 Commonwealth of Pennsylvania County of Cumberland Oath of Personal Representative The Petitioner(s) above-named swear(s) and affirm(s) that the statements in the foregoing Petition are true and correct to the best of the knowledge and belief of Petitioner(s) and that, as persom representative(s) of the decedent, Petitioner(s) will well and truly administer the estate according to law. Sworn to and affirmed and subscribed before me this .TlTT,Y ?6th day of ,~ -IQ.Q.1 .:i~ ~ ~ -;L- ~ ~(J~.w~ ~~,) /lU/.J",...dt DECREE OF REGISTER Estate of PouR ShaJr/lC' tt~ also known as , Deceased No. 21-01-699 Date of Death: ]uiy 4, 2007 Social Security No. 209-72-8990 AND NOW, . JULY 27 , 2001 . in consideration of the Petition on the reverse side hereon, satisfactory proof having been presented before me. IT IS DECREED that Letters l2a Testamentary 0 of Administration are hereby granted to TIMOTHY BRUCE SHARRETTS AND THOMAS PAUL SHARRETTS in the above estate and that the instrument(s), if any, dated 8-8-1988 Petition be admitted to probate and filed of record as the last Will of Decedent. FEES Letters - - - - - - - - - - - - - - - - - - Short Certificate(s) - - - - - - - - - Renunciation - - - - - - - - - - - - - Affidavit ( )- - - - - - - - - - - - - - Extra Pages ( )- - - - - - - - - - - Codicil - - - - - - - - - - - - - - - - - - JCP Fee - - - - - - - - - - - - - - - - Inventory & Tax Forms - - - - -- Other - - - - - - - - - - - - - - - - - - - TOTAL - - - - - - - - - -- RW-7a .- -....., . - ~-~---.---- ---" ._- - - described in the $ 1215.00 $ 30.00 $ $ $ 21.UU $ $ ).uu $ $ ~~!fw~~M/ ~ L R eof lis ~ Attomey: David A. Wion, E~qui~e I. D. No. 06883 Address: 109 Locust Street $ 1271. 00 Harrisburg. FA 17101 Telephone:.. (717'f23~~9301' " '~':.>;--3'.:"" '; ~. j.,~~~~;~~~ DATE FILED: JULY 26.2001 ~.~~. /-027- 0/ ..' .~'''._-:'''..'_':'...:..:.--- .- Th i~ is to certify that the information here given is correctly copied fran: an original certificate of death dul~ filed with me as l,oed Registrar. The original certificate will be forwarded to the State Vital Records Office for permanent filmg. WARNING: It is illegal to duplicate this copy by photostat or photograph. Fee for this certificate, $2.00 p 7431383 No. 21-01-699 t2~~~~"~;r- Local Registrar JUl 0 6 200\ Date COMMONWEALTH OF PENNSYLVANIA · DEPARTMENT OF HEALTH · VITAL RECORDS CERTIFICATE OF DEATH ~ 2/87 NAME OF DECEDENT (FwSl. Mtd<Ie. L., S€X 2. male t. I. STIIJE FIlf NUMllER SOCIAl SECURITY NUM8ER 3. 209 -12 -8990 73 Yrw. 81RTHPl.AC& (Cly aIld PUCE OF DEAfH ICNclI oroIy.".. -- .... '''S1ructoOnS on _ _I SlaIlI 01 FCfeogn eo...y) HOSPITAl: Harrisburg,PA '-'-4 00\0 7. ... NAME jlIllOl "'IMUhO<>. owe "'HI and........-. Dicl ~ "'llIa Cumberland -..hip? '7e1.o ::"'~'=of MOTHER'S NAME .lfo.. h\lcldIe. M-. Surname) l.:arrie Sterrett 11. INI'OAMANT'S MAIUHG ADOflESS \SItHl. C<ly(lOwn. Slate. lip Codal 21 Devonshire S uare, Mechanicsburg, PA 17055 PlIloCE Of OISPOSlTlON. N_ 01 c-aIety, Crem8lllty lOCR1OH . C or 0dwI< Pl..ce 2to. Rolling Green Mem. Park 2!o~wer Allen Twp. t Cumb. NAUEANDAOOflESSOFF.-cILlTY Parthemore FH & Cremation Ioc. 22c. 13 3 Brid e Street NewCumberland PA 17070 LICENSE NUMBER om SlGNEO (MonItl. OIly. \'earl AGe (Last llotthaay) $. COUNTY OF DEAfH -. . _ C~mber land - oeCEDENT'S USUAL OCC\JPlllJ1Oft 17.. Stale 'PA ,.. FAniEA'S NAME (Fost. MoOCJe. last) Irvin L. Sharretts I lb. 2001 ..".24-28 IIlUIl be ~ by I**WI who pronouncee _lit. I IlllllEDlATe CAUSE (1''''''' _01 condIOOn r-.g"_I_ .. .A'~ ..... <<: / h. ',/....,... DUE 10 (OR AS A CONSEOUENCE Of): 4.. .,h~ A'Z;..-..- .,&.:../..-- 10 (OR ASA CONSEOUENCE Of}: I< /".... ./ t::...& .....~ . "''''' .. r'Z DUE 10 (OR AS A CONSEOUENCE OF): SequefwiaIy .. condiliana b if...,. -.cliIlg 10 omrneclila _. e- UNOeAl.YIHO CAUSe(o....OI....y I c. .... ........., ...- resang.. <laaIh) LAST d. -SAN AUtOPSY WERE AUtOPSV FINDINGS MANNER Of DEATH PERFORMED? A\oIlUl.JIl8t.E PRIOR 10 COMP\.ETION OF CAUSE 0 0 OF DEAfH? Halu..' Hcrnocide - 0 Pendong InvestigallOfl 0 - 0 No Yea 0 No 0 Suicide 0 Could IlOI be delermoned 0 DATE OF INJURY (MonIh. Cay. _l white MAAITALSWUS. ~ N_ loAaniad. WIdowed. 0Mltced (SpecIfy) 14. Married ~~tricia 17C.1KI__,~Iiwd", Hallij}den Two. SURVIVING SPOUSE I"..... gtve...-. rwne, A. Fickes lWp. cilyltloro. Co.P 311. 230. w.,s CASE REFERRED TO MEDICAL EXAtoiINERlCORONEIl.? _ 0 NoXJ K. , ApjlroJlunale l=-= I : 3 4",/.) ! J ~~/I'J I : .7 e-- .......J PART II; Olhar signillcanl CXlfIdllion8 conIribuling to claalh. buI 1lOI_ln9 in lhII UIIlIIt1ying _ given 1ft PART I. TIME OF INJURY INJURY /IiI 'NOAA? DESCRIBE HOW INJURY OCCURRED. _ 0 NoD :It. PlACE OF INJURY. AI home. 'arm. .reel. lac;toty. office buiIdInlI. etc. tSpecoM 308. M. 3Oc. 2111. 2111. CIRT"''' ICheck OIlly or.l .ceRTIl'YING PHYSICIAN IPhysoc"", c"'IlIy'''9 """"" <:J uelllll_ anutM. 1J/'v:"C'~ ha$ pronounced dealh ana completed Item 231 T.... bHt 0' my knowledge. c1..ltIoccuned_lO_c.uM(s).ndmanner.. stated. ...... ................................... 'PRONOUNClNG AND CERTIFYING I'HYSICIAN l""y5IC..n Dolh """flouf""n,, ""dill and certdyof1<,l 10 cause 01 <lealtll TO tha lint 0' my knowledgll, deallt oceutr'" al thallme. d.I.. and plac.. and due to 01. cause(.) and m.nner a. Sl.ted.. . . ... 'MEDICAl EXAMINER/CORONER On lhe ba.i. 0' a.amin.tlon andlor invesligation, in my ollinion, dealn occurred at the time, date, and place, and due 10 Ihe cause(a)ancl ",anne. as slated.. . . . . . . . . . .. ....................... ..............,................................,............ 31.. ..a::~s;;'~~._____ lo1/o?,/,/] o 32. ""-'---"">_ ~~ DATE FILED (Monlh Oay. Yea" ~-U Ie ~ (20-.1 "vA /;1",,~.7 i I 1. '. 11Laslllill attb Weslanttttl OF I. PAUL SHARRETTS I, I. PAUL SHARRETTS, of Camp Hill, York County, Pennsylvania, being of sound mind, memory and understanding, do make, publish and declare the following to be my Last Will and Testament, hereby revoking and making void all wills, codicils and testamentary dispositions by me at any time heretofore made. ARTICLE I I order and direct that all my debts and funeral expenses shall be fully paid and satisfied by my Executor hereinafter named as soon as conveniently may be after my decease. ARTICLE II I give all my articles of personal or household use, including any automobiles, to my wife, PATRICIA ANNE SHARRETTS, if she survives me. If my wife, PATRICIA ANNE SHARRETTS, does not so survive me, I give all such property to such of my sons, TIMOTHY BRUCE SHARRETTS and THOMAS PAUL SHARRETTS as so survive me, to be divided among them as they may agree, or in the absence of agreement, as my Executor may think appropriate. ARTICLE III If my wife, PATRICIA ANNE SHARRETTS, survives me, I give the fractional share of my estate necessary to reduce the federal estate tax falling due because of my death to the lowest possible figure to my trustee, IN TRUST, to keep it invested. And thereafter: A. During my wife's lifetime: (I) The entire net income shall be paid to her, at least quarterly; and as much of the principal as my Trustee may from time to time think desirable, taking into account all funds available from other sources, for her health, support and maintenance, shall be paid to her. I intend my Trustee to use principal liberally for my wife to enable her to maintain insofar as possible the standard of living to which she has been accustomed during my lifetime. B. On my wife's death: (1) Any increase in death taxes or administration expenses in her estate caused by the inclusion of a portion of this trust in her estate for tax purposes shall be paid out of the principal of such portion, except to the extent that a specific reference to the trust in her will provides for payment of such taxes and expenses from other sources: and (2) The balance of the then remaining principal shall be paid to such one or more of my descendents on such terms as she may appoint by a will specifically referring to this power of appointment: or in default of appointment or insofar as it is not effective, shall be added to and thereafter treated as a part of the principal of the residuary trust. ARTICLE IV I give the residue of my estate, real and personal, to my Trustee, IN TRUST, to keep it invested and thereafter if my wife, PATRICIA ANNE SHARRETTS, survives me, during her lifetime: (1) The net income shall be paid to her, in quarterly or other convenient installments: (2) As much of the principal as my Trustee may from time to time think desirable, taking into account funds available from other sources, for the health, support and maintenance of my wife or either of my sons, TIMOTHY BRUCE SHARRETTS and THOMAS PAUL SHARRETTS shall be paid to that person or shall be applied directly for those 2 , . I" purposes; provided that none of the principal of this trust shall be paid to or applied for the benefit of my wife unless the principal of the marital deduction trust has first been exhausted. B. After my wife's death, or mine if I survive her, the then- remaining principal shall be paid: (1) In equal shares to such of my son's, TIMOTHY BRUCE SHARRETTS and THOMAS PAUL SHARRETTS as are then living; provided that if either or both of my sons is not then living but has then- living issue, such issue shall receive, per stirpes, the share such son would have received had he been then living. ARTICLE V In calculating the fractional share of my estate to be allocated to the martial deduction trust, (i) the unlimited marital deduction allowed by the Economic Recovery Tax Act of 1981 shall apply to my estate, (ii) the fraction shall be calculated as if my Executor elected to qualify the entire marital deduction trust for the marital deduction in my estate, (iii) the final determinations for federal estate tax purposes in my estate shall control, (iv) the value of any property which qualifies for the marital deduction in my estate but which does not pass under this instrument to the marital deduction trust shall be taken into consideration, and (v) the fraction shall be reduced to the extent necessary to give my estate the full benefit of all other deductions and credits allowed in calculating the federal estate tax in my estate (but only to the extent so doing does not increase state death taxes). For the purpose of computing the fractional share and making distributions to the marital deduction trust, "my estate" shall mean my net probate estate, but without any deduction for death taxes. No property ineligible for the marital deduction shall be distributed 3 to the marital deduction trust. ARTICLE VI My wife shall be deemed to have survived me if the order of our deaths is not clear. ARTICLE VII All federal, state and other death taxes payable because of my death on the property forming my gross estate for tax purposes, whether or not is passes under this will, shall be paid out of the princial of my probate estate so that the burden thereof falls on my residuary estate (or, to the extent my residuary estate is insufficient, from the portion of the marital deduction trust which my Executor elects not to qualify for the marital deduction), and none of those taxes shall be charged against the portion of the marital deduction trust which my Executor elects to qualify for the marital deduction, any beneficiary or any outside fund. This provision shall not apply to generation-skipping transfer taxes. ARTICLE VIII I direct my Executor to exercise any options available in determining and paying death taxes in my estate in such a way as reasonably may be expected to achieve the greatest overall tax savings for my family, without regard to any effect upon the size of the marital deduction trust and without requiring adjustments between income and principal. I give my Executor complete discretion in dividing my estate into the two trusts aforedescribed, taking into consideration the appreciation factor of assets. ARTICLE IX No beneficiary under the aforementioned trust shall have the right to anticipate any payment or payments herein provided for or 4 to give, grant, sell, assign or transfer or in any way or manner dispose of any right herein given, save only, of course, that after any beneficiary receives his share of the income or payments as herein provided, he may then freely use and dispose of the same as his pleasure may dictate, and provided further, that both the principal and income of the trust fund while in the hands of the Trustees shall be and remain free from any and all debts, contracts and engagements of any of the persons beneficiary under the trust. ARTICLE X Without limitation of the powers conferred upon them by this Will, by statute or rule of law, any fiduciary under this Will is specifically authorized and empowered to retain, purchase or otherwise acquire without restriction any stocks, bonds, mortgages, notes or other securities, or other variety of real or personal property, even though such property may not be of the character allowed by law; to sell, lease, pledge, mortgage, exchange, convert or otherwise dispose of any property at any time forming part of my estate, in such manner including public or private sale, at such times, for such purposes and for such prices and upon such terms and conditions as said fiduciary shall deem advisable; to borrow money whenever in their judgment it may be advisable, and as security to mortgage or pledge any property forming part of my estate on such terms and conditions as said fiduciary may deem advisable; to compromise or otherwise adjust any claims or demands in favor of or against my estate; to continue, manage and operate any existing business or enterprise in which I may have an interest as proprietor, partner or principal stockholder at the time of my death, and any interest therein, for as long a period as to them shall seem advisable or desirable in the best interests of my 5 estate, and in so doing to renew, reissue or to make originally all forms or evidences of indebtedness binding my estate for the payment of such sums as they may think necessary with like power to exercise this right to bind my estate by endorsement or negotiable paper or other forms of instruments and/or to settle, discontinue, liquidate or sell said business or interest therein, at any time, at public or private sale, upon such terms, for cash or on credit, with or without interest, in such manner and at such prices as in their judgment and discretion may be proper, advisable or advantageous, to make distribution, division or apportionment in kind and to cause any share to be composed of cash, property, or undivided fractional shares in property different in kind from any other share: to execute and deliver such instruments as may be necessary to carry out any of these powers: and to do all other acts which any fiduciary under this Will may deem necessary or desirable for the proper execution or discharge of any powers or duties held or imposed upon them, whether by the terms of this Will or by law, any fiduciary under this Will to have all of the discretion and power to do or refrain from doing any or all of the foregoing things to the same extent and as fully, in all respects, as I could do myself if living. ARTICLE XI I nominate, constitute and appoint my sons, TIMOTHY BRUCE SHARRETTS and THOMAS PAUL SHARRETTS, and FRANK M. BALSBAUGH, JR., as Co-Executors of this, my Last Will and Testament. I nominate, constitute and appoint TIMOTHY BRUCE SHARRETTS, THOMAS PAUL SHARRETTS and FRANK M. BALSBAUGH, JR. as Trustees of the Trusts created herein. I hereby relieve my personal representative from 6 . .. the necessity of posting security in connection with his duties as such in any jurisdiction in which he may be called upon to act insofar as I am able by law to do so. IN WITNESS WHEREOF, I, I. PAUL SHARRETTS, have to this, my Last Will and Testament, written on seven (7) sheets of paper, set my hand and seal this e~ day of aui~ , 1988. -Jl;1~H~ Lt. ~ul Sh rretts (SEAL) Signed, sealed, published and declared by the above-named I. Paul Sharretts, as and for his Last Will and Testament, in the presence of us, the subscribing witnesses, who, at his instance and request, and in his presence and the presence of each other, have hereunto set our hands the day and year aforesaid. It R ~/~ ~ ~~d: Name 6t?~ hIe C /7,;5 19// c'" //Ll c:-- Address / Mu ~ ~ Addres~ . r.. 7 . . , COMMONWEALTH OF PENNSYLVANIA SS: COUNTY OF DAUPHIN We, I. PAUL SHARRETTS, \ .. \OJ'~l \~ .fo'-"J (i q "'.~..." and \~ '-., ct k'~=:r'7 1-' .. A-. \,J l~ ,) , the Testator and the witnesses respectively, whose names are signed to the attached or foregoing instrument, being first duly sworn, do hereby declare to the undersigned officer that the Testator signed the instrument as his Last Will and that he signed voluntarily and that each of the witnesses in the presence of the Testator at his request, and in the presence of each other, signed the Will as a witness and that to the best of the knowledge of each witness, the Testator was at that time 18 or more years of age, of sound mind and under no constraint or undue influence. (~(/;2 !2~ Testa~or - I. PAUL SHARRETTS 0dZ#1Zd/ y. . WiL (1~:HtJ. .' ' Wltness Sworn to and subscribed before me by I. PAUL SHARRETTS, the Testator, and subscribed and sworn to before me by -J 10 h '1 l-J.-. pc::> ~. if and \~ ~J. /+., WLC:,..:l , the witnesses, ~n 7~rs ~ day ,9f August, 1988. \ / .-\ ~/ \; :y . .~ y r '~~=-::t/~~a'ry P~;-lt \._/ ~ ~ ycomm~~1d~'p~plres : ANN J.. lONG, Notary Publit Haf'r1sburg, Dauphin County, Pa. My 'Commission Expires Dec. 29, 1991 8 - E. CERTIFICATION OF NOTICE UNDER RULE 5.6(a) Name of Decedent: 1. Paul Sharretts Date of Death: 7/4/2001 699 of 2001 Admin. No. Will No. To the Register: I certify that notice of beneficial interest required by Rule 5.6{a) of the Orphans' Court Rules was served on or mailed to the following beneficiaries of the above-captioned estate on 7/31/2001 Patricia A. Sharretts Address 21 Devonshire Square M8SRaaisggyrg, PA 17055 811 Highland Court M~SRaaisggYrg, PA 17050 1752 Olmstead Way Camp Rill, PA 17011 Name Thomas Paul Sharretts Tinothy Bruce Sharretts Notice has now been given to all persons entitled thereto under Rule 5.6(a) except None Date: ?1/ { ( CO ( j)~G. L Signature Name David A. Wion. ESQuire Address 109 Locust Street Harrisburg, PA 17101 Telephone (717) 236-9301 Capacity: Personal Representative x Counsel for personal representative CERTIFICATION OF NOTICE UNDER RULE 5 6 (A) Name of Decedent: Genevieve S. Turner Date of Death: 02/01/2002 Estate Number: 21-02-0160 To the Register: I certify that notice of beneficial interest required by Rule 5.6 (a) of the Orphans' Court Rules was served on or mailed to the following beneficiaries of the above-captioned estate on 03/04/2002 : Name W. Robert Shughart Gayle Beeler Don E. Turner TerryL. Turner Keith E. Turner Address 106 Sycamore Drive, Mt. Holly Springs, P A 17065 14 Fourth S1., Biglerville, P A 17037 2625 Rose Garden Blvd, Mechanicsburg, P A 17055 18 Larken Lane, Mt. Holly Springs, P A 17065 407 Centerview Ave., New Cumberland, P A 17070 Notice has now been given to all persons entitled t e 0 under Rule 5.6 (a) except N/A. Date: 03/04/2002 Name: Ian M. Wiley, Esquire fV"\ Ii) Cl Address: One S. Baltimore S1. Dillsburg, P A 17019 \0 I 0:::: c:;C :c Telephone: (717) 432-9666 :'~--'- l.';".t ,....... w.... p .Q - ,:: .-/>. ::; ~ " ,. ... .... ....... Capacity: Counsel for personal Rep. IN THE ORPHAN'S COURT DIVISION CUMBERLAND COUNTY, PENNSYLVANIA CERTIFICATION OF NOTICE UNDER RULE 5.6(a} Name of Decedent: SPUNGIN SAMUEL Date of Death: 10/15/01 Estate No. SSN: 458-90-8167 File No. Date Letters Granted: 11/27/01 Will or Administration No. 2001 - 01076 To the Register: I certify that Notice of Estate Administration required by Rule 5.6(a) of the Orphans' Court Rules was served on or mailed to the following beneficiaries of the above-captioned estate on 3./ t;/ C) ~ Name DOROTHY M. ELDER Address 1241 TIMBERVIEW DRIVE MECHANICSBURG, PA 17050 12 CIRCLE DRIVE MECHANICSBURG, PA 17050 495 CABIN HOLLOW ROAD DILLSBURG, PA 17019 KEITH JOHN ELDER DEBORAH KLABE Notice has now been given to all persons entitled thereto under Rule 5.6(a} except NIA Date: 3/4/02 Capacity: Personal Representative X Counsel for Pe~al Repr~$~lltative s::;~ Name (Please type or print) MAXINE KAY LEWIS, ESQUIRE Address 1101 NORTH FRONT STREET ...- .-- .-- HARRISBURG PA 17102 \.0 I cr:::: .;:c: :;c Telephone No. 717 1 234 - 3136 (~ ~ (::.;:. ok. N P ,...1 , .iJ ',,,: s::: ,'J = , - ,," " .,. ~, ..... ...... , .. "..- IN RE: :IN THE COURT OF COMMON PLEAS :CUMBERLAND COUNTY, PENNSYLVANIA ESTATE OF I. PAUL SHARRETTS, :ORPHANS' COURT DIVISION Deceased :NO. 2001-00699 DISCLAIMER AND NOW comes, TIMOTHY BRUCE SHARRETTS, pursuant to the provisions of Section 2518 and Section 2046 of the Internal Revenue Code and makes a written Disclaimer as follows: 1. I. Paul Sharretts died on July 4, 2001 and a Testamentary Estate was raised to the above captioned term and number. 2. In his Last Will and Testament dated August 8, 1988, the aforesaid I. Paul Sharretts provided in Article IV a residuary trust, and further in said Article provided that; (2) "As much of the principal as my Trustee may from time to time to think desirable, taking into account funds available from other sources, for the health, support and maintenance of my wife or either of my sons, Timothy Bruce Sharretts and Thomas Paul Sharretts shall be paid to that person or shall be applied directly for those purposes; provided that none of the principal of this Trust shall be paid to or applied for the benefit of my wife unless the principal or the Marital Deduction Trust has first been exhausted." 3. The Disclaimant, Timothy Bruce Sharretts hereby disclaims any and all ~ amounts, benefits, items or interest provided to and for him in the aforesaid Article IV(2) of the Last Will and Testament dated August 8, 1988. 4. This Disclaimer shall not be interpreted and shall not affect any other provision of the aforesaid Last Will and Testament dated August 8, 1988 relating or providing bequests, amounts, benefits or interest to Timothy Bruce Sharretts. 5. This Partial Disclaimer is irrevocable, and unqualified as to the interest disclaimed. 6. The Disclaimant hereby verifies that he has accepted no benefits, interests or items expressed or implied, of the aforesaid bequest in paragraph Article IV(2) prior to making this Disclaimer. IN WITNESS WHEREOF, the Disclaimant has hereunto set his hand and seal this --tl- day of ~~ , 2001. WITNESS: [)r~~C L ~~ Bruce Sharretts .. .Y COMMONWEAL TH OF PENNSYLVANIA SS: COUNTY OF DAUPHIN ~ Be it Remembered, that on \~ r I f subscriber, a Notary Public, personally appeared TIMOTHY BRUCE SHARRETTS, , 2001, before me the known to me (or satisfactorily proven) to be the person whose name is subscribed to the within Disclaimer and acknowledged that he executed the same for the purposes therein contained. WITNESS my hand and seal the day and year aforesaid. (N~~~~ \ ~<(\':.~H.~,~~fAl My Commission Expires: I,. ? !i;;;;'I~~~~}~~~' ~':' - " IN RE: :IN THE COURT OF COMMON PLEAS :CUMBERLAND COUNTY, PENNSYL VANIA ESTATE OF I. PAUL SHARRETTS, :ORPHANS' COURT DIVISION Deceased :NO. 2001-00699 DISCLAIMER AND NOW comes, TIMOTHY BRUCE SHARRETTS, pursuant to the provisions of Section 6201 of the Pennsylvania Probate, Estates and Fiduciaries Code (20 Pa. C.S.A. Section 6201), and makes a written Disclaimer as follows: 1. I. Paul Sharretts died on July 4, 2001 and a Testamentary Estate was raised to the above captioned term and number. 2. In his Last Will and Testament dated August 8, 1988, the aforesaid I. Paul Sharretts provided in Article IV a residuary trust, and further in said Article provided that; (2) "As much of the principal as my Trustee may from time to time to think desirable, taking into account funds available from other sources, for the health, support and maintenance of my wife or either of my sons, Timothy Bruce Sharretts and Thomas Paul Sharretts shall be paid to that person or shall be applied directly for those purposes; provided that none of the principal of this Trust shall be paid to or applied for the benefit of my wife unless the principal or the Marital Deduction Trust has first been exhausted." 3. The Disclaimant, Timothy Bruce Sharretts hereby disclaims any and all .. -- amounts, benefits, items or interest provided to and for him in the aforesaid Article IV(2) of the Last Will and Testament dated August 8, 1988. 4. This Disclaimer shall not be interpreted and shall not affect any other provision of the aforesaid Last Will and Testament dated August 8, 1988 relating or providing bequests, amounts, benefits or interest to Timothy Bruce Sharretts. 5. This Partial Disclaimer is irrevocable, and unqualified as to the interest disclaimed. 6. The Disclaimant hereby verifies that he has accepted no benefits, interests or items expressed or implied, of the aforesaid bequest in paragraph Article IV(2) prior to making this Disclaimer. IN WITNESS WHEREOF, the Disclaimant has hereunto set his hand and seal l' day of tu(,~ , 2001. this WITNESS:, f{ [J (1/'. ~ I.fl. '\ ~~SW lmothy Bruce Sharretts ~ COMMONWEAL TH OF PENNSYL VANIA SS: COUNTY OF DAUPHIN , Be it Remembered, that on ~ r I 7 , 2001, before me the subscriber, a Notary Public, personally appeared TIMOTHY BRUCE SHARRETTS, known to me (or satisfactorily proven) to be the person whose name is subscribed to the within Disclaimer and acknowledged that he executed the same for the purposes therein contained. WITNESS my hand and seal the day and year aforesaid. ~ (l&~ Notary Public y-- My Commission Expires: NOT ARIAl SEAL ANN J, LONG, Notary ,Public City of Harrisburg. ~auphln County MY Commission Expires Oct. 30. 2003 \ , \ "'. " IN RE: :IN THE COURT OF COMMON PLEAS :CUMBERLAND COUNTY, PENNSYLVANIA ESTATE OF I. PAUL SHARRETTS, :ORPHANS' COURT DIVISION Deceased :NO. 2001-00699 DISCLAIMER AND NOW comes, THOMAS PAUL SHARRETTS, pursuant to the provisions of Section 6201 of the Pennsylvania Probate, Estates and Fiduciaries Code (20 Pa. C.S.A. Section 6201), and makes a written Disclaimer as follows: 1. I. Paul Sharretts died on July 4, 2001 and a Testamentary Estate was raised to the above captioned term and number. 2. In his Last Will and Testament dated August 8, 1988, the aforesaid I. Paul Sharretts provided in Article IV a residuary trust, and further in said Article provided that; (2) "As much of the principal as my Trustee may from time to time to think desirable, taking into account funds available from other sources, for the health, support and maintenance of my wife or either of my sons, Timothy Bruce Sharretts and Thomas Paul Sharretts shall be paid to that person or shall be applied directly for those purposes; provided that none of the principal of this Trust shall be paid to or applied for the benefit of my wife unless the principal or the Marital Deduction Trust has first been exhausted." 3. The Disclaimant, Thomas Paul Sharretts hereby disclaims any and all ... - amounts, benefits, items or interest provided to and for him in the aforesaid Article IV(2) of the Last Will and Testament dated August 8, 1988. 4. This Disclaimer shall not be interpreted and shall not affect any other provision of the aforesaid Last Will and Testament dated August 8, 1988 relating or providing bequests, amounts, benefits or interest to Thomas Paul Sharretts. 5. This Partial Disclaimer is irrevocable, and unqualified as to the interest disclaimed. 6. The Disclaimant hereby verifies that he has accepted no benefits, interests or items expressed or implied, of the aforesaid bequest in paragraph Article IV(2) prior to making this Disclaimer. IN WITNESS WHEREOF, the Disclaimant has hereunto set his hand and seal ~~ , /71? day of , 2001. this WITNESS:... ~. ~C,. ~U~ Thomas Paul Sharretts .-~ . COMMONWEAL TH OF PENNSYLVANIA SS: COUNTY OF DAUPHIN Be it Remembered, that on D ~ C-- - 11 subscriber, a Notary Public, personally appeared THOMAS PAUL SHARRETTS, , 2001, before me the known to me (or satisfactorily proven) to be the person whose name is subscribed to the within Disclaimer and acknowledged that he executed the same for the purposes therein contained. WITNESS my hand and seal the day and year aforesaid. Nota~PubI~~~ ~6 ~ My Commission Expires: __ NOTARIAL SEAL ] ANN J. LONG. Notary Public City of Harrisburg, DatJJ)hin County · My Commission Ex ires Oct. 30. 2(lU~ , ... IN RE: :IN THE COURT OF COMMON PLEAS :CUMBERLAND COUNTY, PENNSYL VANIA ESTATE OF I. PAUL SHARRETTS, :ORPHANS' COURT DIVISION Deceased :NO. 2001-00699 DISCLAIMER AND NOW comes, THOMAS PAUL SHARRETTS, pursuant to the provisions of Section 2518 and Section 2046 of the Internal Revenue Code and makes a written Disclaimer as follows: 1. I. Paul Sharretts died on July 4,2001 and a Testamentary Estate was raised to the above captioned term and number. 2. In his Last Will and Testament dated August 8, 1988, the aforesaid I. Paul Sharretts provided in Article IV a residuary trust, and further in said Article provided that; (2) "As much of the principal as my Trustee may from time to time to think desirable, taking into account funds available from other sources, for the health, support and maintenance of my wife or either of my sons, Timothy Bruce Sharretts and Thomas Paul Sharretts shall be paid to that person or shall be applied directly for those purposes; provided that none of the principal of this Trust shall be paid to or applied for the benefit of my wife unless the principal or the Marital Deduction Trust has first been exhausted." 3. The Disclaimant, Thomas Paul Sharretts hereby disclaims any and all amounts, benefits, items or interest provided to and for him in the aforesaid Article IV(2) of the Last Will and Testament dated August 8, 1988. 4. This Disclaimer shall not be interpreted and shall not affect any other provision of the aforesaid Last Will and Testament dated August 8, 1988 relating or providing bequests, amounts, benefits or interest to Thomas Paul Sharretts. 5. This Partial Disclaimer is irrevocable, and unqualified as to the interest disclaimed. 6. The Disclaimant hereby verifies that he has accepted no benefits, interests or items expressed or implied, of the aforesaid bequest in paragraph Article IV(2) prior to making this Disclaimer. IN WITNESS WHEREOF, the Disclaimant has hereunto set his hand and seal fJ~ let' day of , 2001. this WITNESS: ()~(i, .~ ~ tf JJ~ Thomas Paul Sharretts , . COMMONWEAL TH OF PENNSYLVANIA SS: COUNTY OF DAUPHIN Be it Remembered, that on~ -e ~ ~ /1 subscriber, a Notary Public, personally appeared THOMAS PAUL SHARRETTS, , 2001, before me the known to me (or satisfactorily proven) to be the person whose name is subscribed to the within Disclaimer and acknowledged that he executed the same for the purposes therein contained. WITNESS my hand and seal the day and year aforesaid. ~~~~- - Notary Public -- 0- . .. IN RE: :IN THE COURT OF COMMON PLEAS :CUMBERLAND COUNTY, PENNSYL VANIA ESTATE OF I. PAUL SHARRETTS, :ORPHANS' COURT DIVISION Deceased :NO. 2001-00699 DISCLAIMER AND NOW comes, PATRICIA ANNE SHARRETTS, pursuant to the provisions of Section 2518 and Section 2046 of the Internal Revenue Code and makes a written Disclaimer as follows: 1. 1. Paul Sharretts died on July 4,2001 and a Testamentary Estate was raised to the above captioned term and number. 2. In his Last Will and Testament dated August 8, 1988, the aforesaid I. Paul Sharretts provided in Article IV a residuary trust, and further in said Article provided that; ARTICLE IV I give the residue of my estate, real and personal, to my Trustee, IN TRUST, to keep it invested and thereafter if my wife, PATRICIA ANNE SHARRETTS, survives me, during her lifetime: (1) The net income shall be paid to her, in quarterly or other convenient installments; . "- (2) As much of the principal as my Trustee may from time to time to think desirable, taking into account funds available from other sources, for the health, support and maintenance of my wife or either of my sons, Timothy Bruce Sharretts and Thomas Paul Sharretts shall be paid to that person or shall be applied directly for those purposes; provided that none of the principal of this Trust shall be paid to or applied for the benefit of my wife unless the principal or the Marital Deduction Trust has first been exhausted. 3. The Disclaimant, Patricia Anne Sharretts, hereby disclaims any and all amounts, benefits, items or interest provided to and for her in the aforesaid Article IV of the Last Will and Testament dated August 8, 1988. 4. This Disclaimer shall not be interpreted and shall not affect any other provision of the aforesaid Last Will and Testament dated August 8, 1988 relating or providing bequests, amounts, benefits or interest to Patricia Anne Sharretts. 5. This Partial Disclaimer is irrevocable, and unqualified as to the interest disclaimed. 6. The Disclaimant hereby verifies that she has accepted no benefits, interests or items expressed or implied, of the aforesaid bequest in paragraph Article IV prior to making this Disclaimer. IN WITNESS WHEREOF, the Disclaimant has hereunto set his hand and seal this /7 day of 3-('("~jIh bt r- , 2001. w~ j! W-~ 'fCJ~~ ~ Patricia Anne Sharretts .. - . .. COMMONWEAL TH OF PENNSYL VANIA SS: COUNTY OF DAUPHIN Be it Remembered, that on \~ a--~ ~ ~ l 7' subscriber, a Notary Public, personally appeared PATRICIA ANNE SHARRETTS, , 2001, before me the known to me (or satisfactorily proven) to be the person whose name is subscribed to the within Disclaimer and acknowledged that she executed the same for the purposes therein contained. WITNESS my hand and seal the day and year aforesaid. /)~ /1 \".~\ _ ~a Notary Public My Commission Expires: NOTARIAL SEAL C ANN J. ~ONG. Notary PublIC M ~~rr.ISburg. .Dauphm County '. . SjQO EX es Oct. 30, 2003 ~ 0.7. .. IN RE: :IN THE COURT OF COMMON PLEAS :CUMBERLAND COUNTY, PENNSYL VANIA ESTATE OF I. PAUL SHARRETTS, :ORPHANS' COURT DIVISION Deceased :NO. 2001-00699 DISCLAIMER AND NOW comes, PATRICIA ANNE SHARRETTS, pursuant to the provisions of Section 6201 of the Pennsylvania Probate, Estates and Fiduciaries Code (20 Pa. C.S.A. Section 6201), and makes a written Disclaimer as follows: 1. I. Paul Sharretts died on July 4,2001 and a Testamentary Estate was raised to the above captioned term and number. 2. In his Last Will and Testament dated August 8, 1988, the aforesaid I. Paul Sharretts provided in Article IV a residuary trust, and further in said Article provided that; ARTICLE IV I give the residue of my estate, real and personal, to my Trustee, IN TRUST, to keep it invested and thereafter if my wife, PATRICIA ANNE SHARRETTS, survives me, during her lifetime: (1) The net income shall be paid to her, in quarterly or other convenient installments; -Y -r ... (2) As much of the principal as my Trustee may from time to time to think desirable, taking into account funds available from other sources, for the health, support and maintenance of my wife or either of my sons, Timothy Bruce Sharretts and Thomas Paul Sharretts shall be paid to that person or shall be applied directly for those purposes; provided that none of the principal of this Trust shall be paid to or applied for the benefit of my wife unless the principal or the Marital Deduction Trust has first been exhausted. 3. The Disclaimant, Patricia Anne Sharretts, hereby disclaims any and all amounts, benefits, items or interest provided to and for her in the aforesaid Article IV of the Last Will and Testament dated August 8, 1988. 4. This Disclaimer shall not be interpreted and shall not affect any other provision of the aforesaid Last Will and Testament dated August 8, 1988 relating or providing bequests, amounts, benefits or interest to Patricia Anne Sharretts. 5. This Partial Disclaimer is irrevocable, and unqualified as to the interest disclaimed. 6. The Disclaimant hereby verifies that she has accepted no benefits, interests or items expressed or implied, of the aforesaid bequest in paragraph Article IV prior to making this Disclaimer. IN WITNESS WHEREOF, the Disclaimant has hereunto set his hand and seal this / 7 day of fleCt'A1.hl'r- , 2001. WITNESS: f)~ @r L '-fJ~1f~ ~ ~. Patricia Anne Sharretts ... . COMMONWEAL TH OF PENNSYL VANIA SS: COUNTY OF DAUPHIN Be it Remembered, that on Q ~ ~. {7 , 2001, before me the subscriber, a Notary Public, personally appeared PATRICIA ANNE SHARRETTS, known to me (or satisfactorily proven) to be the person whose name is subscribed to the within Disclaimer and acknowledged that she executed the same for the purposes therein contained. WITNESS my hand and seal the day and year aforesaid. ~ a '-4~ NO~C 0- My Commission xpue. NOTARIAL SEAL . ANN J. LONG. Notary Public City of Harrisburg, Dauphm Coun M Commission Ex ires Oct. 3D, 2<%3 'Y; REGISTER OF WILLS OF CUMBERLAND COUNTY, PENNSYLVANIA INVENTORY Estate of: I. Paul Sharretts, Deceased No.: 0699-2001 Date of Death: July 4,2001 Social Security No.: 209-12-8990 Personal Representative(s) of the above Estate, deceased, verify that the items appearing in the following inventory include all of the personal assets wherever situate and all of the real estate in the Commonwealth of Pennsylvania of said Decedent, that the valuation placed opposite each item of said Inventory represents its fair value as of the date of the Decedent's death, and that Decedent owned no real estate outside of the Commonwealth of Pennsylvania except that which appears in a memorandum at the end of the Inventory, IJW e verify that the statements made in this Inventory are true and correct. IJW e understand that false statements herein are made subject to the penalties of 18 Pa. C.S. Section 4904 relating to unsworn falsification to authorities. Name of Attorney: David A. Wion, Esquire Personal Representatives: ID.No.: 06883 ~t~ Address: 109 Locust Street Harrisburg, PAl 71 01 Dated: ~/z $p""L- Telephone: 717-236-9301 Description Value Stocks and bonds (See attached lists) 1999 Cadillac Seville STS-4 Door $ 2,239,920.00 432,328.00 17,096.00 22,000.00 200.00 1,300.00 22,727.88 Sharretts Limited Partnership - 49.5% interest Sharretts Plating Co., inc. - 20,000 Shares Common A Stock Misc. Jewelry Travelers Checks Statue Realty Assoc. - Mortgage Total $ 2,735,571.88 " .. - Estate of: I. Paul Sharretts Item No. Description ~lied Irish - 14,500 Shares 0$22.245 PP&L - 9,532.239 Shares @$55.36 Advan ta Bank Corp. - $57,000.00 Certificate of Deposit 6.55% - 11/29/2001 !If &: I Bank Northeast - $50,000.00 Certificate of Deposit - 6.60% 9/26/2001 DNA America Bank, N.A. - $93,000.00 Certificate of Deposit - 6.60% 11/29/2001 Central Dauphin PA Sch .Dist $100,000.00 Certificate of Deposit - 5.00% 6/01/2005 Pennsylvania HSG ~;n Agcy Single ~am MtSl' R.ev Ser 1995-46 - $50,000.00- 4.95% - 10/1/2002 Dauphin enty PA Gen Auth Blth Sys RV Pinnacle Blth Sys PJ - 5~OO% - $50,000.00 5/15/2004 cumberland Valley PA Sch Dlsb U/T ~GIC Insd Bank Qual-R.eg -4.50% ~2/15/2004 - $50,000 East NorritonPA G/O Bank Qual. AKBAC Insd-Reg - $50,000.00 4.95% 8/15/2006 Pennsylvania BFA S/ram Mtg~63 Rev -$100,000.00 4.35% - 4/1/20~5 Norwin P~ Sch Dist Ser AGiO Ser .A.' J4;B:tA Insd - $50,000.00 - 4.0% - Schedule B --Stocks and Bonds unit Val. Alternate CUSIP Val. Date l"O'l'AL. (Carry forward to main schedule) . ;. Alternate Value 0.00 Page 2 0 9 -12 - 8 .9 9 ( Value at Date of Death ;.~22'; 522 .5C 527,704.75 57,OOO.OC so,ooo.oc 93,OOO.OC 100,954.0C Sl,036.0C Sl,967.S.C 50,219.0( so., OS7 .SC 100,964.0C, 50,074.0C $1,%,499.25 . ." Estate of: L. Paul Sharret~s Item No. Description Value at Date of Death 4/1/2007 Monroe Cnty PA - Bk/QuaI Reg OLD U/T - $50,000.00 - 4.40% - 10/1/2007 Pennsylvania HSG Fin Agy S/Fam Mtg Ser 53A - $100,000.00 - 5.450%- 10/1/2007 Chester Co PA H & E PAC AU HIt Sys RV Jefferson HIt Sys-B - $100,000.00 - 5.0% - 5/15/2008- Pennsylvania St Tpk Commn Oil franchise tax Sub-B - $100,000.00 - 4.50% - 12/1/2008 pottsville PA Hosp Auth Rev-A Ascension Hlt Credit $100,000.00 - 5.20% - 11/15/2009 Salomon Smith Barney Money market Account No. 724-01344-16-002 ExeIon Corp. - 1,000 Shares @$64.975 UGI Corp. - 2,000 Shares @$26.980 Schedule B -- Stocks and Bonds Unit Val. CUSIP Alternate Val. 'Date TOTAL. (Carry forward to main schedule) . . . . . . Alternate Value 0.00 Page 209-12-899C 50,400.0C 10S,634.0C 104,116.0C 102,337.0C 10S,756.0C 147,240.71 64,97S.0C 53,960.0C 734,418.77 COMMONWEALTH OF PENNSYLVANIA DEPARTMENT OF REVENUE BUREAU OF INDIVIDUAL TAXES DEPT. 280601 HARRISBURG, PA 17128-0601 REV-' '62 EX!" -96) RECEIVED FROM: PENNSYLVANIA INHERITANCE AND ESTATE TAX OFFICIAL RECEIPT WION ZULLI & SEIBERT A TTYS 109 LOCUST STREET HARRISBURG, PA 17101 -------- fold ESTATE INFORMATION: SSN: 209-12-8990 FILE NUMBER: 21-2001- 0699 DECEDENT NAME: SHARRETTS I PAUL DA TE OF PAYMENT: 10/02/2001 POSTMARK DATE: 00/00/0000 COUNTY: CUMBERLAND DATE OF DEATH: 07/04/2001 NO. CD 000337 ACN ASSESSMENT CONTROL NUMBER AMOUNT 101 I $10,000.00 I I I I I I I I TOTAL AMOUNT PAID: $10,000.00 REMARKS: TIMOTHY B SHARRETTS C/O WION ZULLI & SEIBERT A TTYS CHECK#1006 SEAL INITIALS: PB RECEIVED BY: REGISTER OF WILLS MARY C. LEWIS REGISTER OF WILLS COMMONWEALTH OF PENNSYLVANIA DEPARTMENT OF REVENUE BUREAU OF INDIVIDUAL TAXES DEPT. 280601 HARRISBURG, PA 17128-0601 REV-1162 EX( 11-96) RECEIVED FROM: PENNSYLVANIA INHERITANCE AND ESTATE TAX OFFICIAL RECEIPT WION DAVID A ESQ 109 LOCUST ST HARRISBURG, PA 17101 __n____ fold ESTATE INFORMATION: SSN: 209-12-8990 FILE NUMBER: 2101-0699 DECEDENT NAME: SHARRETTS I PAUL DA TE OF PAYMENT: 04/01/2002 POSTMARK DATE: 00/00/0000 COUNTY: CUMBERLAND DATE OF DEATH: 07/04/2001 NO. CD 001017 ACN ASSESSMENT CONTROL NUMBER AMOUNT 101 I $12,324.81 I I I I I I I I TOTAL AMOUNT PAID: $12,324.81 REMARKS: ALLFIRST BANK C/O DAVID A WION ESQUIRE CHECK# 2230913871 SEAL INITIALS: SK RECEIVED BY: REGISTER OF WILLS MARY C. LEWIS REGISTER OF WILLS /b-;Jj/b-b ~ BUREAU OF INDIVIDUAL TAXES INHERITANCE TAX DIVISION DEPT. 280601 HARRISBURG, PA 17128-0601 COMMONWEALTH OF PENNSYLVANIA DEPARTMENT OF REVENUE INHERITANCE TAX STATEMENT OF ACCOUNT *' REV-IU? EX AFP (01-02) ~J DATE ESTATE OF DATE OF DEATH FILE NUMBER COUNTY ACN 10-21-2002 SHARRETTS 07-04-2001 21 01-0699 CUMBERLAND 101 I P DAVID A WION ESQ WION ETAL 109 LOCUST ST HBG Allount Rellitted PA'17101 MAKE CHECK PAYABLE AND REMIT PAYMENT TO: REGISTER OF WILLS CUMBERLAND CO COURT HOUSE CARLISLE, PA 17013 NOTE: To insure proper credit to your account, subllit the upper portion of this form with your tax payment. CUT ALONG THIS LINE ~ RETAIN LOWER PORTION FOR YOUR RECORDS ~ REY=i6"ifj-iif-AFP--cffi:02)-------...--iNiiERITANCi--YAX--STATEMENf-ifF'-ACCO(;N-f--.-i.--------------------- ESTATE OF SHARRETTS I P FILE NO. 21 01-0699 ACN 101 DATE 10-21-2002 THIS STATEMENT IS PROVIDED TO ADVISE OF THE CURRENT STATUS OF THE STATED ACN IN THE NAMED ESTATE. SHOWN BELOW IS A SUMMARY OF THE PRINCIPAL TAX DUE, APPLICATION OF ALL PAYMENTS, THE CURRENT BALANCE, AND, IF APPLICABLE I A PROJECTED INTEREST FIGURE. DATE OF LAST ASSESSMENT OR RECORD ADJUSTMENT: 10-07-2002 PR I NC I PAL TAX DUE: ........................m._............................................m............................................................................................................................................ 22,824.81 PAYMENTS (TAX CREDITS): PAYMENT RECEIPT DISCOUNT (+) AMOUNT PAID DATE NUMBER INTEREST/PEN PAID (-) 10-02-2001 CDOO0337 526.32 10,000.00 04-01-2002 CD001017 .00 12,324.81 10-07-2002 REFUND .00 26.32- TOTAL TAX CREDIT 22,824.81 BALANCE OF TAX DUE .00 INTEREST AND PEN. .00 . IF PAID AFTER THIS DATE, SEE REVERSE TOTAL DUE .00 SIDE FOR CALCULATION OF ADDITIONAL INTEREST. ( IF TOTAL DUE IS LESS THAN $1, NO PAYMENT IS REQUIRED. IF TOTAL DUE IS REFLECTED AS A "CREDIT.. (CR) I YOU MAY BE DUE A REFUND. SEE REVERSE SIDE OF THIS FORM FOR INSTRUCTIONS. ) /6-~~6- 6 ~ BURfAU OF INDIVIDUAL TAXES . INHER'TANCE TAX DIVISION DEPT. 280601 HARRISBURG, PA 17128-0601 COMMONWEALTH OF PENNSYLVANIA DEPARTMENT OF REVENUE NOTICE OF INHERITANCE TAX APPRAISEMENT, ALLOWANCE OR DISALLOWANCE Of DEDUCTIONS AND ASSESSMENT OF TAX DATE ESTATE OF DATE OF DEATH FILE NUMBER COUNTY ACN 10-14-2002 SHARRETTS 07-04-2001 21 01-0699 CUMBERLAND 101 j; DAVID A WION ESQ WION ETAL 109 LOCUST ST HBG PA 7101 *' REY-1547 EX AFP C01-02) I P Allount Rellitted (1) (2) (3) (4) (5) (6) (7) .00 2,239,920.00 449,424.00 .00 46,228.00 .00 141,694.48 MAKE CHECK PAYABLE AND REMIT PAYMENT TO: REGISTER OF WILLS CUMBERLAND CO COURT HOUSE CARLISLE, PA 17013 CUT ALONG THIS LINE .. RETAIN LOWER PORTION FOR YOUR RECORDS ~ REY=is47-i3f-AFir-CoY:OZ'r-NOYici--OF--friHERifANCi-YAX-APPRA-isEiiENT~--Aii-oWANCi-OR----------------- DISALLOWANCE OF DEDUCTIONS AND ASSESSMENT OF TAX ESTATE OF SHARRETTS I P FILE NO. 21 01-0699 ACN 101 DATE 10-14-2002 TAX RETURN WAS: ( J ACCEPTED AS FILED ( X) CHANGED SEE ATTACHED NOTICE RESERVATION CONCERNING FUTURE INTEREST - SEE REVERSE APPRAISED VALUE OF RETURN BASED ON: ORIGINAL RETURN 1. Real Estate (Schedule A) 2. Stocks and Bonds (Schedule B) 3. Closely Held Stock/Partnership Interest (Schedule C) 4. Mortgages/Notes Receivable (Schedule D) 5. Cash/Bank Deposits/Misc. Personal Property (Schedule E) 6. Jointly Owned Property (Schedule f) 7. Transfers (Schedule G) 8. Total Assets APPROVED DEDUCTIONS AND EXEMPTIONS: 9. Funeral Expenses/Adll. Costs/Misc. Expenses (Schedule H) 10. Debts/Hortgage Liabilities/Liens (Schedule I) 11. Total Deductions 12. Net Value of Tax Return 13. Charitable/Governllental Bequestsj Non-elected 9113 Trusts (Schedule J) 14. Net Value of Estate Subject to Tax I~ an assessment was issued previously, lines 14, 15 and/or 16, 17, 18 and 19 will re~lect ~igures that include the total of ALL returns assessed to date. ASSESSMENT OF TAX: 15. Allount of Line 14 at Spousal rate (15) 16. Allount of Line 14 taxable at Lineal/Class A rate (16) 17. Allount of Line 14 at Sibling rate (17J 18. Allount of Line 14 taxable at Collateral/Class B rate (18) 19. Principal Tax Due NOTE: (9) (10) 58,570.00 (8) (19)= NOTE: To insure proper credit to your account, submit the upper portion of this forll with your tax paYllent. 2,877,266.48 59.067 00 2,818,199.48 2,228,119.48 590,080.00 .00 22,824.81 .00 .00 22,824.81 TAX CREDITS: r'ATnI:NI n.........-. l"'J AMOUNT PAID DATE NUHBER INTEREST/PEN PAID (-) 10-02-2001 CDOO0337 526.32 10,000.00 04-01-2002 CDOOI017 .00 12,324.81 10-07-2002 REFUND .00 26.32- TOTAL TAX CREDIT 22,824.81 BALANCE OF TAX DUE .00 INTEREST AND PEN. .00 TOTAL DUE .00 . IF PAID AFTER DATE INDICATED, SEE REVERSE FOR CALCULATION OF ADDITIONAL INTEREST. 497.00 Ill) (12) (13) (14) 82,862.00 X 00 = 507 ,218.00 X 045 = .00 X 12 = .00 X 15 = ( IF TOTAL DUE IS LESS THAN $1, NO PAYMENT IS REQUIRED. IF TOTAL DUE IS REFLECTED AS A "CREDIrw (CR), YOU HAY BE DUE A REFUND. SEE REVERSE SIDE OF THIS FORM FOR INSTRUCTIONS.) REV-1470 EX (6088) INHERITANCE TAX EXPLANA liON OF CHANGES COMMONWEALTH OF PENNSYLVANIA DEPARTMENT OF REVENUE BUREAU OF INDIVIDUAL TAXES DEPT. 280601 HARRISBURG PA 17128-0601 DECEDENTS NAME REVIEWED BY SCHEDULE ITEM NO. I. Paul Sharretts Bill Lyons EXPLANA liON OF CHANGES The estate is deferring the tax on the marital trust. ROW FILE NUMBER ACN 2101-0699 101 Page 1 ) '- STATUS REPORT UNDER RULE 6.12 ~ ~ Name of Decedent: I. Paul Sharretts Date of Death: July 4. 2001 Estate No.: 2001-00699 Pursuant to Rule 6.12 of the Supreme Court Orphans' Court Rules, I report the following with respect to completion of the administration of the above captioned Estate: 1. State whether administration of the Estate is complete: YES: NO: x 2. If the answer is No, state when the personal representative reasonably believes that the administration will be complete: By the filing of a First & Final Accounting in the Fall of2003 3. If the answer to No.1 is Yes, state the following: (A) Did the personal representative file a final Account with the Court? YES: NO: (B) The separate Orphans' Court No. (if any) for the personal representative's account is: (C) Did the personal representative state an account informally to the parties in interest? YES : NO: (~Copies ~f receipts, relea.ses, joinders and approvals of formal or informal ;',~accounts may be filed wIth the Clerk of the Orphans' Court and may be ;:.:attached to this report. t..n N {J~((. L, ,--:::0- ,~D(lted: ~une 23,2003 ~I) x cr s "= ~::. ,;) ~ ...; .~ ".-::: ~.,-, ........... Signature David A. Wion, Esquire 109 Locust Street, P.O. Box 1121 Harrisburg, P A 17108 (717) 236-9301 Capacity: Personal Representative x Counsel for Personal Representative , '- Cumberland County - Register Of Wills Hanover and High Street Carlislet PA 17013 Phone: (717) 240-6345 Date: 6/10/2003 SHARRETTS TIMOTHY BRUCE 1752 OLMSTEAD WAY CAMP HILLt PA 17011 RE: Estate of SHARRETTS I PAUL File Number: 2001-00699 Dear Sir/Madam: It has come to my attention that you have not filed the Status Report by Personal Representative (Rule 6.12) in the above captioned estate. As per the AMENDMENTS TO SUPREME COURT ORPHANS' COURT RULESt NO. 103 SUPREME COURT RULES DOCKET NO. 1/ for decedents dying on or after July It 1992/ the personal representative or his counselt within two (2) years of the decedent's deatht shall file with the Register of Wills a Status Report of completed or uncompleted administration. This filing will become delinquent on: 7/04/2003 Your prompt attention to this matter will be appreciated. Thank You. SincerelYt DONNA M. OTTO DEPUTY REGISTER OF WILLS cc: J File Counsel Judge Postage $ M CertIfIed Fee CJ CJ Return Reclept Fee Postmark CJ (EndorSement ReqUired) Here CJ Restricted Delivel)' Fee M (Endorsement ReqUired) CJ M Total postage & Fees $ rn CJ Sent To ~ mmef,-APCNO:~f..C:::... ...g,~.. ...--......---..--.--....--...------. or PO Box No. cny;.Si;,ie;ziP+4.-..................................--.--....-........-. ............. USE Cel1lfled Fee Retum Reclept Fee (Endorsement Required) CJ Restricted Delivery Fee ....=l (Endorsement Required) ....=l rn Postmark Here :II - .. .. .. . Total Postage & Fees $ rn ~ ~:~o~A::-..~..:..Sha[L____=___o__ --i.~fh1"---'------'----_._-"- "utnlt. ,..,.,t. IVO., or PO Box No. citY: -state; ZiP+4---o 0 .--- - - -..- -.-.... - "0-' - .-- -- ------ -- - -" -.- 0-- -.. - - ---0 - - 0 --- -. .:::t" t:l Certified Fee t:l Postmark t:l Return Reclept Fee Here (Endorsement Required) t:l Restricted Delivery Fee ,...::j (Endorsement Required) ,...::j fTl $ Total Postage & Fees fTl ~ "l4r_-_:~ .~10.-::- --.... ~l~ .~n.___....____. "._. _ __ _ __. ___ __ _ _" __... _..." __. __ __..." _ _ __. ~U8fJt. ",.,t. No.; or PO Box No. Chi. -s;a;e;'Z1P.;:;;.......... ............ .........-.-...... ..n....." _u_... ..-.--.. ...." REV 1500 EX (6-00) OFfT'IAl TO Cl/ Rev-1500 c _lib _NLY .....................I.fr!..:.-d..'I...4..-::...?1................. ~ COMMONWEALTH OF PENNSYLVANIA FILE NUMBER DEPARTMENT OF REVENUE DEPT. 290601 INHERITANCE TAX RETURN HARRISBURG, PA 17128-0601 21 2001 0699 - RESIDENT DECEDENT County Code Year Number DECEDENTS NAME (LAST. FIRST. AND MIDDLE INITIAL) SOCIAL SECURITY NUMBER I- :z Sharrelts, I. Paul 209-12-8990 w Cl DATE OF DEATH (MM-DD-YEAR) DATE OF BIRTH (MM-DD-YEAR) THIS RETURN MUST BE FILED IN DUPLICATE WITH W U 7/4f2001 10/23/1927 REGISTER OF WILLS w Cl (IF APPLICABLE) SURVIVING SPOUSE'S NAME (LAST, FIRST, AND MIDDLE INITIAL) SOCIAL SECURITY NUMBER Sharretts, Patricia A. 168~24-4273 $ x 1. Original Return - 2. Supplemental Return - 3. Remainder Return (date of death pnorlO 12- - ~.~~ 4. limited Estate 4a. Future Interest Comprise (date of death aflef 12-12-liZ\ X 5 Federal Estate Tax Return RequIred 00.0 - - - ~E.2 0~1Il x 6. Decedent Died Testate (Attach copy of Will) 7. Decedent Maintained a Living Trust (Attach a copy a! Trust) 8. Total Number of Safe Deposit Boxes - - <( 9. Litigation Proceeds Received l...- 10. Spousal Poverty Credit (datB af death bBlween 12-31.91 and 1-1-95) 011. Election to tax under Sec. 9113(A) - TliIS SECTION MUST BE COMPLETED. ALL CORRESPONDENCE AND CONFIDENTIAL TAX INFORMATION SHOULD BE DIRECTED TO: = NAME COMPLETE MAJLlNG AODRESS <l> n.. . ,. ""M .on";'. = 109 Locust Street = 8- FIRM NAME (If Applicable) Harrisburg, PA 17101 ~ Wion, Zulli & Seibert <=> TELEPHONE NUMBER <..> 717-236-9301 1. Real Estate (Schedule A) (1) $0.00 OFFICIAL USE ONLY 2. Stocks and BondS (Schedule B) (2) $2,239,920.00 ~ . ...I"'~ d J:l 3 910sely Held Corporation, Partnership or Sole-Proprietorship (3) $442;424.00 ,'~' N Z 4. Mortgages & Notes Receivable (Schedule 0) (4) $0.00 0 "'" -c.' ~ 5. Cash, Bank Deposits & Misc. Personal Property (Schedule E) (5) $46,226.00 X. I 6. Jointly Owned Property (Scl"ledule F) (6) $0.00 - :J D Separate Billing Requested l- e.. 7. Inter-Vivos Transfers & Misc. Non-Probate Property (7) $141,694.46 <( .....~~~:...................,;......................... U (Schedule G or L) \.0 W 8. Total Gross Assets (total lines 1-7) (6) $2,877,266.48 e::: 9. Funeral Expenses & Administrative Costs (Schedule H) (9) $56,570.00 10. Debts of Decedent, Mortgage Liabilities & Liens (Schedule I) (10) $497.00 11. Total Deductions {total lines 9 & 10) (11) S!i9 067 00 12. Net Value of Estate (Line 8 minus Line 11) (12) $2,818,199.46 13. Cl1aritable and Governmental Bequests/Sec 9113 Trusts for which an election to tax has not been (13) SO 00 made (Schedule J) 14. Net Value Subject to Tax (Line 12 minus line 13) (14) $2,818,199.48 SEE INSTRUCTIONS ON REVERSE SIDE FOR APPLICABLE RATES 15. Amount of line 14 taxable at the spousal tax Z rate, or transfers under Sec. 9116 (a)(1.2) $2,310,981.48 x .000 (15) $0.00 D - f: 16. Amount of line 14 taxable at lineal rate $507,218.00 x .045 (16) $22,824.81 ~~ - f-:J 17. Amount of line 14 taxable at sibling rate x .12 (17) $0,00 a. :; 18. Amount of line 14 taxable at collateral rate x .15 (18) so 00 0 lJ 19. Tax Due (19) $22.824.81 20.~ > > BE SURE TO ANSWER ALL QUESTIONS ON REVERSE SIDE AND RECHECK MATH < < Decedent's Complete Address: STREET ADDRESS 21 Devonshire Square CITY I~TATE TZIP Mechanicsburg PA 17055 Tax Payments and Credits: 1. Tax Due (Page 1 Line 19) 2. Credits/Payments A. Spousal Poverty Credit B. Prior Payments C. Discount (1) $22.824.81 ~1n nnn nn ~~nn no Total Credits (A + 6 + C) (2) $1050000 3. InterestlPenalty if applicable D. Interest E. Penalty Total Interest/Penalty (D + E) (3) 4. If line 2 is greater than line 1 + line 3. enter the difference. This is the OVERPAYMENT. Check box on Page 1 Line 20 to request a refund (4) 5. If line 1 + line 3 is greater than line 2, enter the difference. This is the TAX DUE. (5) $0.00 $12.324.81 6. Enter the total of Line 5 + SA. This Is the BALANCE DUE. (SA) (56) $12.324.81 A. Enter the interest on the tax due. Make Check Payable to: REGISTER OF WILLS, AGENT PLEASE ANSWER THE FOllOWING QUESTIONS BY PLACING AN X IN THE APPROPRIATE BLOCKS 1. Did decedent make a transfer and: a. retaln the use or income of the property transferred; b. retain the right to designate who shall use the property transferred or its income; c. retain a revisionary interest; or d. receive the promise for life of either payments, benefits or care? 2. If death occurred after December 12, 1962, did decedent transfer property within on year of death without receiving adequate consideration? r=J Did decedent own an "in trust for" or payable upon death bank account or security at his or her c=l Did decedent own an Individual Retirement Account, annuity, or other non-probate property which contains a beneficiary designation? ~ CJ IF THE ANSWER TO ANY OF THE ABOVE QUESTIONS IS YES, YOU MUST COMPLETE SCHEDULE G AND FILE IT AS PART OF THE RETURN. Yes ~ No m E3 3. 4. Under penalties of perjury, I declare thai I have examined Ihis return, including acc~nying schedules and statements, and to the best of my knowledge and belief, II is true, correct, and complete. Declaration of preparer other than Ihe personal representative is based on all the informallon of whld1 preparer has any knowledge. .~-!J-~ DATE '3 8.d). For dates of death on or after July 1, 1994 and before January 1, 1995, the tax rate imposed on the net value of transfers to or for the use of the surviving spouse is 3% [72 P.S. ~9116 (a) (1.1) (i)]. For dates of death on or after January 1, 1995, the tax rate imposed on the net value of transfers to or for the use of the surviving spouse is 0% (72 P.S. S9116 (a) (1.1) (ii)}, The statute does not exemot a transfer to a surviving spouse from tax, and the statutory requirements for disclosure of assets and filing a tax return are still applicable even if the surviving spouse is the only beneficiary, For dates of death on or after July 1, 2000: The tax rate imposed on the net value of transfers from a deceased child twenty-one years of age or younger at death to or for the use of a natural parent, an adoptive parent, or a stepparent of the child is 0% [72 P.S. ~9116(a) (1.2)J. The tax rate imposed on the net value of transfers to or for the use of the decedent's lineal beneficiaries is 4,5%, except as noted in 72 P.S. ~9116(1.2) [72 P.S. ~9116(a)(1)]. The tax rate imposed on the net value of transfers to or for the use of the decedent's siblings is 12% [72 P.S. ~9116(a)(1.3)J. A sibling is defined, under Section 9102, as an individual who has at least one parent in common with the decedent, whether by blood or adoption. REV-1502EX = (1-97) (I) COMMONWEALTH OF PENNSYLVANIA INHERITANCE TAX RETURN RESIDENT DECEDENT SCHEDULE A REAL ESTATE ESTATE OF 1. Paul Sharretts FILE NUMBER All real property owned solely or as a tenant in common must be reported at fair market value. Fair market value Is defined as the price at which property would be exchanged between a willing buyer and a willing seller, neither being compelled to buy or sell, both having reasonable knowledge of the relevant facts. Real property which Is Jolntly-owned with right of survivorship must be disclosed on Schedule F. ITEM NUMBER 1. DESCRIPTION VALUE AT DATE OF DEATH None TOTAL (Also enter on line 1, Recapitulation) (If more space is needed, Insert additional sheets of the same size) $0.00 REV.1503EX:(1-97)(I) COMMONWEALTH OF PENNSYLVANIA INHERITANCE TAX RETURN RESIDENT DECEDENT SCHEDULE B STOCKS & BONDS ESTATE OF l. Paul Sharretts FILE NUMBER All property Jolntly-owned with right of survivorship must be disclosed on Schedule F. ITEM NUMBER DESCRIPTION 1. VALUE AT DATE OF DEATH See attached lists TOTAL (Also enter on line 2, Recapitulation) (If more space is needed, insert additional sheets of the same size) $2,239,920.00 Estate of.: I. Paul Sharretts Item No. Description Allied Irish - 14,500 Shares 0$22.245 PP~L - 9,532.239 Shares @$55.36 Ad'V'anta Bank Corp. - $57,000.00 Certifioate of Deposit 6.55~ - 11/29/2001 M . I Ban~ Northeast - $50,000.00 certifioate of Deposit - 6.60% ' 9/26/2001 MBNA lUnerica Bank, N.A. - $93,000.00 Certifioate of Deposit - 6.60~ 11/29/2001 Central Dauphin PA Soh .Dist $100,000.00 Cartificate of Deposit - 5.00% 6/01/2005 pennsylvania RSGI I'~n Ago:/, Sillgle ll'am Mt5l' Rev Ser 1995-46 - $SO,OOO.OO- 4.9~ - 10/1/2002 Dauphin cnty PA Gen Auth Blth Sys RV pinnacle Blth Sys PJ - 5;00% - $50,000.00 5/15/2004 cumberland Valley PA Soh Dist V/T I'GlIC Insd Bll:tlk Qual-Reg -4.50% 12/15/2004 - $50,000 East No=itoll PA G/O Bank Qual, AMBAC Illsd-Reg - $50,000.00 - 4.95% 8/15/2006 Pennsylvania Bl'A S/I'am Mtg"63 Rev -$100,000.00 4.35% - 4/1/20~5 Norwin PA Soh Dimt Ser A GI/O Ser A-MBIA Insd - $50,OOri~oo - 4.0% - Sohedule B --Stooks and :!londs 'trni t Val. CVSIP TOTAL. (Carry forward to main schedule) . Alternate Val. Date :,. Alte=ate Value 0.00 Page ~ 209-12-899t Value at Date of Death "'322,522.5t 527,704.7: 57,000.Ot 50,000.Ot 93,000.OC 100,954.CC 51,036.0C 51,967.5( 50,219.0C 50,057.5C 100,964.0C, 50,074.0t $1,505,499.25 Estate of: r. Paul Sharretts rtem No. Description Value at Date of Death 4/1/2007 Monroe Reg OrD 4.40% - Cnty PA - Bk/Qual U/T - $50,000.00 - 10/1/2007 Pennsylvania HSG Fin Agy S/Fsm Mtg Ser 53A - $100,000.00 - 5.450%- 10/1/2007 Chester Co PA H & E FAC AU Hlt Sys RV Jefferson Xlt Sys-B - $100,000.00 - 5.0% - 5/15/2008" Pennsylvania St Tpk Commn Oil franchise tax Sub-B - $100,000.00 - 4.50% - 12/1/2008 Pottsvi11e PA Hosp Auth Rev-A Ascension Hlt Credit $100,000.00 - 5.20% - 11/15/2009 Salomon Smi th Barney Money market Account No. 724-01344-16-002 Exelon Corp. - 1,000 Shares GP$64.975 UGr Corp. - 2,000 Shares GP$26.980 Schedule B -- Stocks and Bonds Unit Val. CUSIP Alternate Val. "Date TOTAL. (Carry forward to main schedule) . . . . . . . Alternate Value 0.00 Page 209-12-899( 50,400.0C 105,634.0C 104,116.0C 102,337.0C 105,756.0C 147,240.77 64,975.0C 53,geO.OC 734,418.77 REV.1504EX=(1-97)(I) SCHEDULE C COMMONWEALTH OF PENNSYLVANIA INHERITANCE TAX RETURN RESIDENT DECEDENT CLOSELY-HELD CORPORATION, PARTNERSHIP or SOLE-PROPRIETORSHIP ESTATE OF I. Paul Sharretts FILE NUMBER Schedule C~1 or C~2 (Including all supporting information) must be attached for each closely-held corporation/partnership interest of the decedent, other than a sole- proprietorship. See instructions for the supporting information to be submitted for sole~proprietorships. ITEM NUMBER 1. DESCRIPTION Sharretts Limited Partnership ~ 49.5% interest held by Decedent - 000 value - See appraisal attached VALUE AT DATE OF DEATH $432,328.00 2. Sharretts Plating Co.. Inc. - 20.000 Shares Common A Stock - See appraisal attached $17,096.00 TOTAL (Also enter on line 3. Recapitulation) (If more space is needed, Insert additional sheets of the same size) $449,424.00 REV-1507 EX + (1-97)(1) COMMONWEALTH OF PENNSYLVANIA INHERITANCE TAX RETURN RESIDENT DECEDENT SCHEDULE D MORTGAGES & NOTES RECEIVABLE ESTATE OF I. Paul Sharretts FILE NUMBER All property jointly-owned with the right of survivorship must be disclosed on Schedule F. ITEM NUMBER 1. DESCRIPTION VALUE AT DATE OF DEATH None TOTAL (Also enter on line 4, Recapitulation) (If more space is needed, insert additional sheets of the same size) $0.00 REV.1508 EX + (1-97)(1) COMMONWEALTH OF PENNSYLVANIA INHERITANCE TAX RETURN RESIDENT DECEDENT SCHEDULE E CASH, BANK DEPOSITS, & MISC. PERSONAL PROPERTY ESTATE OF I. Paul Sharretts FILE NUMBER Include the proceeds of litigation and the date the proceeds were received by the estate. All property Jolntly-owned with the right of survivorship must be disclosed on Schedule F. ITEM NUMBER DESCRIPTION VALUE AT DATE OF DEATH 1. 1999 Cadillac Seville STS-4 Door - VIN No. 1G6KY5495XU903855 $22,000.00 2. Misc. Jewelry - Appraised Value $200.00 3. Travelers Checks - 000 vaiue $1,300.00 4. Statue Realty Assoc. - Mortgage $22,727.88 TOTAL (Also enter on line 5, Recapitulation) (If more space IS needed, Insert additional sheets of the same size) $46,228.00 REV"1509EX+(1-91)(1) COMMONWEALTH OF PENNSYLVANIA INHERITANCE TAX RETURN RESIDENT DECEDENT SCHEDULE F JOINTLY-OWNED PROPERTY ESTATE OF I. Paul Sharretts FILE NUMBER If an asset was made joint within one year of the decedent's date of death, it must be reported on Schedule G. SURVIVING JOINT TENANT(S) NAME ADDRESS RELATIONSHIP TO DECEDENT A. B. c. JOINTLY-OWNED PROPERTY: ITEM LETTER DATE DESCRIPTION OF PROPERTY DATE OF DEATH "kOF DATE OF DEATH NUMBER FOR JOINT MADE Include name of fmancial institution and bank account number or similar identifying number. VALUE OF ASSET DECO'S VALUE OF TENANT JOINT Attach deed for jointly-held real estate. INTEREST DECEDENT'S 1. A. None TOTAL (Also enter on line 6, Recapitulation) $0.00 (If more space is needed, insert additional sheets of the same size) REV_1510EX+(1.97)(1) COMMONWEALTH OF PENNSYLVANIA INHERITANCE TAX RETURN RESIDENT DECEDENT SCHEDULE G INTER-VIVOS TRANSFERS & MISC. NON-PROBATE PROPERTY ESTATE OF I. Paul Sharretts FILE NUMBER This schedule must be completed and filed if the answer to any of questions 1 through 4 on the reverse side of the REV-1500 COVER SHEET is yes. DESCRIPTION OF PROPERTY % OF DECO'S TAXABLE ITEM INCLUDE THE NAME OF THE TRANSFEREE, THEIR RELATIONSHIP TO DECEDENT AND THE DATE OF TRANSFER DATE OF DEATH INTEREST EXCLUSION VALUE NUMBER ATIACHA COPY OF THE DEED FOR REAL ESTATE VALUE OF ASSET (IF APPLICABLE) 1. Salomon Smith Barney -I. Paul Sharretts Individual Retirement Account; $60,862.00 100.0% $60,862.00 Beneficiary ~ Patricia A. Sharretts (Spouse) - 7/4/2001 2. Cash Gift to Thomas P. Sharretts (Son) - 12/31/2000 $52,611.48 100.0% 3,000.00 $49,611.48 3. Cash Gift to Thomas P. Sharretts (Son) - 1/1/2001 $34,221.00 100.0% 3,000.00 $31,221.00 $141,694.4 TOTAL (Also enteron line 7, Recapitulation) 8 (If more space is needed, insert additional sheets of the same size) REV-1511 EX+(1-97){1) COMMONWEALTH OF PENNSYLVANIA INHERITANCE TAX RETURN RESIDENT DECEDENT SCHEDULE H FUNERAL EXPENSES & ADMINISTRATIVE COSTS ESTATE OF I. Paul Sharretts FILE NUMBER Debts of decedent must be reported on Schedule I. ITEM NUMBER DESCRIPTION AMOUNT A. FUNERAL EXPENSES: 1. Parthemore Funeral Home & Cremation Services, Inc, . Funeral expenses $4,641.00 2. Rolling Green Cemetery Company - Internment $1,764.00 B. ADMINISTRATIVE COSTS: 1. Personal Representative's Commissions Name of Personal Representative (s) Social Security Number(s) I EIN Number of Personal Representative(s) Street Address City State Zip - Year(s) Commission Paid: 2. Attorney Fees - Wion, Zulli and Seibert $32,250.00 3. Family Exemption: (If decedent's address is not the same as claimant's, attach explanation) Claimant Street Address City State Zip - Relationship of Claimant to Decedent 4. Probate Fees $1,271.00 5. Accountant's Fees Beard Miller Company, LLP $17,975.00 6. Tax Return Preparer's Fees 7. Cumberland County Law Journal - Advertising $75.00 8. The Sentinel - Advertising $104.00 9. Help U Sel - Appraisal of Florida property $300.00 10. Mountz Jewelers - Appraisal fee $90.00 11. Wion, Zulli & Seibert - Copies, notary fees, postage $100.00 TOTAL (Also enter on line 9, Recapitulation) $58,570.00 (If more space is needed, insert additional sheets of the same size) REV.1512 EX + (1-97)(1) COMMONWEALTH OF PENNSYLVANIA INHERITANCE TAX-RETURN RESIDENT DECEDENT SCHEDULE I DEBTS OF DECEDENT, MORTGAGE LIABILITIES & LIENS ESTATE OF I. Paul Sharretts FILE NUMBER Include unrelmbursed medical expenses. ITEM NUMBER 1. Dr. Javier Canasi - Medical bill DESCRIPTION AMOUNT $202.00 2. Holy Spirit Hospital. Medical Bills $295.00 TOTAL (Also enter on line 10, Recapitulation) (If more space is needed, insert additional sheets of the same size) $497.00 REV.1513 EX + (9-00)) COMMONWEALTH OF PENNSYLVANIA INHERITANCE TAX RETURN RESIDENT DECEDENT SCHEDULE J BENEFICIARIES ESTATE OF I. Paul Sharretts FILE NUMBER RELATIONSHIP TO DECEDENT AMOUNT OR NUMBER NAME AND ADDRESS OF PERSON(S) RECEIVING PROPERTY Do Not List Trusteels) SHARE I. TAXABLE DISTRIBUTIONS [include outright spousal distributions, and transfers under Sec. 9116 (a) (1.2)) ,. I. Paul Sharretts Marital QTIPTrust $2,227.920.00 clo Timothy B. Sharretts 1752 Olmstead Way Camp Hill, PA 17011 2. Timothy B. Sharretts Son $202,030.00 1752 Olmstead Way Camp Hill, PA 17011 3. Thomas P. Sharretts Son $282,863.00 1143 Country Club Road Camp Hill, PA 17011 4. Patricia A. Sharretts Wife Personal Property 21 Devonshire Square under Item II of Mechanicsburg, PA 17055 Will ENTER DOLLAR AMOUNTS FOR DISTRIBUTIONS SHOWN ABOVE ON LINES 15 THROUGH 18, AS APPROPRIATE, ON REV- II. NON-TAXABLE DISTRIBUTIONS: A. SPOUSAL DISTRIBUTIONS UNDER SECTION 9113 FOR WHICH AN ELECTION TO TAX IS NOT BEING MADE 1. B. CHARITABLE AND GOVERNMENTAL DISTRIBUTIONS 1. TOTAL OF PART II - ENTER TOTAL NON-TAXABLE DISTRIBUTIONS ON LINE 13 OF REV-1500 COVER SHEET $0.00 (If more space is needed, insert additional sheets of the same size) Form 709 ~ SbMs G\ft. {& Genera\\on-Sklpping Trah&1et) Tax Return OMU.,'.......... 0_"-'10<".'-' (Seclion 6019 0I1he - -- Code) (For gIIls..- cIudng __21101) 2001 InbtrnIII n.-- Servb .. See w .... .............. 1 IlonDr's _ name and..-- _ 2 Donor's.... name 3 --- - sec:uiftr............ I. PAUL SIUlRllET'J'S 20~-12-8990 P 4 Address (_. sbtlOI, and _.._~ number) 5 .......-(..-11.......-' A 21 DEVONSHIRE SQUARE cr-vT"II1D CN'.rY. ,PA ~ 6 CIIy. staIII. and ZIP code 7 Cllir_liPJ" MECHANJ:CBBllRG, PA 17055 USA 1 8 1l1he_dledtlUringllte_.-_. X and_dlIIBoI_ J\i1y 04 .200:1. G 9 II you ...- an ..... of lime to lie this Form 709. _ _ . 0 & _lite Form ol868, l!Il88, 23SD. or ~ - ~ 10 En1erllte__ol__--on-A-COUIIl--triyonce....:1 ~ 118 Have you (lite donor) ~_ a Fomt 7C9 (or 7OIl-A)for any _\'I8'l1f _ is "'No: do -~ line 11b. . X A 11b"lIteanswerlDIine11ais"Yes,,_~_changedslnceyou__Form709(or7lllH\l?................. L 12 GlIIsbyhusbandor___padios. DDyOU__.._lItegllls{lrtl:lldlllO-.......~lIl-)..- I by you and byyour__ _ ..-cludng.... __ ....-...s.. _1lOl8-b;lI by - 0Iyuu? N (See _)lll1he ......-is"Yes:lIte-..lng .""'.........must be_ ___ must sUn lite F consent shoWn beIow.lfllte_ls "1iD:sldpllneS 13-18_golDs..! .- A,).......................... ... ~ 13 Nemeol__6.o_ 14SSN ~ 15 WereyOU..-lDone_duIlngllte_............\'I8'l(--)................... .............. T 16 lIanswerIo1Sis_"__ _ --.&gIve_(seeinst.) · 6 17 WIIagllltax_tor....__be....by_opouse? ................................. ...... ....... N 18 eo.-ttolSpooMe l_to_the't:'C:tJl&o-........-..........4..-"'me_"'II1I'_to-par1ios during the __....- as..- by_ of lIS. 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T andbl.JoreJanuary'. 19771__)..................... --....... ....-......... ~ 11 BaIence(sub1ract1lle101rom1ne9).... ......... --........... -..' -. -.... - --...... - - -.- c 12 ~_I_Ihe_oIIine8orh11).. ....... ..... ..-"--........ ............ o 13 ~torfoleignglll-{see~}.... -.................................... -' -. P A ~ 14 T A 15 1 T16 Co H 17 TObIItax (acid Ines 1S MId 18). ........................... --.......................... ~ 18 GIltand~~__""""""__JSirmoftimelDlIIe..._-._..'..._..- E C K or g 20 N e '( Sign o Here R D E R H E R E 1f1ine18is~_h17.__to.._ ................ .......... -.... 2D yiIIg........... ................ wu.......o1 MY .. .. ................hiCh p~ h_ My l... ,. 10 11 12 13 TObII_ledd....'2-'3)..... -...-... -......... - -- -. -...... -" - -.... -'" --'" Balencelsub1ract1ine14fromline 8) (do oot_losslhan zero) ............. -. -....... -. -.. GOI'I<ll'8IiOrHl__lfrOIII~C. P8rt8,ool H. TObII).... -................. 14 15 16 17 18 19 1I1ine'8isloss_1ine17.___I__I.... - - --- - -..... -.......... -- 19 Poid Prepar". \Joe Only Yes No x x 24 221.00 1.99,1.'13.48 223,394.48 62 286.23 54,535.51 7,750.72 22O,SSO.oo 54 535.6'1 :166 014.33 1. 0.00 0:14. 3 7 750.72 0.00 7,750.72 0.00 0.00 0.00 0.00 0.00 0.00 ~ 3- '-1- 0'2-.. Fo<IJlI eM =~';~ Finn's name ( 1er =- if ~7 East Market st 8ddress.&Z1P_ York PA :1740:1 Phone no. . ......, Prtvacy Act.- "-_,,,"'k -.... _-. see lite ......-.... _tor_ fonn. 1 7091 NTF 2565641 GLD 4222 Copyright 2001 GreaU_d/NelGO - For..aSoftwanl Only Check . self- -."'J8d.. .. . (7:17) -846-7000 Form 709 (2001) I. PAUL SHARRE'l''l'S ,SaN: 209-12-8990 Item No. 1 A B Schedu~e A -- Part 1 Gifts Subject Only to Gift 'l'ax Donee's name, relationshi..p to donor, add.resB f a.n.d. &sc.l:i:pti.on OTHER GIFTS THOMAS P. SHARRET'l'S (SON) 1143 COllN'.!'RY CLUB ROAD CAMP HILL, I?A 17011 Cash c Donor I S Adj. Basi-a D Date of Gift 34,221.00 01/01/2001 Page: 1 E Value of G:i:ft 34,221.00 34,221.00 Form 709 (2001) Page 2 Computation of Taxable Gifts (Including Transfers In Trust) A Does the value of any item listed on Schedule A reflect any valuation discount? 11 the answer is "Yes," see instructions. . . . .. Yes No X B ... Check here ff you elect under s.ctlon 529(c)(2)(B) to treat any transfers made thIs year to a qualified state tuition program as made ratably over a 5-year period beginning this year. See instructions. Attach explanation. Part 1 -- Gifts Subject Only to Gift iax. Gifts less political organlzation, medical, and educational exclusions -- see Instructions A B C D E Item . Donee's name and address Donor's adjusted Oat. Value at number . Relationship to donor (ff any) basis of gift of gift date of gift . Description of gift . "gl1\ was made by m.ane of trust, enter trust's EIN & attach a description or copy of trust instrument (see instructions) . If the gl1\ was of sscuOties, give CUSIP numbar See Schedule attached Total of Part 1 (add amounts from Part 1, column E) ................,.................................... ~ 34,221,00 Part 2 -- Gifts That are D'rect Skips and ere SUbJect to Both Gift Tax and Generation-Skipping Transfer Tsx. You must list the giftS In chronological order. Gifts less political organization. medical. and educational exolusions -- see instructions. (Also list here direct skips that are subject only to the GST tax at thls time as the result of the termination of an "estate tax: inclusion period," See instNctkms.) A B C D E Item . Donee's name and address Donor's adjusted Date Value at number . Relationship to donor (ff any) basis of gift of gift date of gift . Description of gift . H gift was made by means of trust, enter trust's EIN & attach a description or copy of trust instrument (see Instructions) . If the gift was of s.curltles, give CUSIP number - 0,00 Total of Part 2 (add amounts from Part 2, column E) .. . .. . . . . . . . .. . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . ., ~ Part 3 -- Taxable Gill Reconciliation 1 Total value of gffts of donor (add total. from column E of Parts 1 and 2) .. . . . . . . . . . . . . .. . . . . . . . . . . . . . 1 2 One-hatl of ~ems attributable to spouae (see Instructions) . 2 3 Balance (subtract line 2 from line 1) .. . .. .. .. .. .. .... .. . ... .. . .. . .. . .. .. .. . . .. .. .. . . , . .. .. . .. 3 4 GI1ts at spouss \0 be includsd (from Schedul. A, Part 3, line 2 of spouse's rsturn - sse Instructions). . . . . . . 4 If any of the gifts Included on this line are also subject to the generation-skipping transfer tax. check here .. 0 and enter those gifts also on Schedule C. Part '1. 5 Total gffts (add lines 3 and 4) . . . . . . . . . . . . . .. . . . . . .. . . . . . . . . . . . . . . . . . . .. .. . . . .. . . . . . . . . 6 Total annual exclusions for gifts listed on Schedule A (including line 4, above) (see instructions). . , , . . . . , . . 7 Total includ.d amount of gl1ts (subtract IIns 6 from line 5) ......,................................, Deductions (see Instructions) 8 Glftsa11nterests to spouse for which a mamal deduction will be claimed, based on~ems ofSchadul.A..............8 0.0 9 Exclusions attributabl. to gl1ts on line 8........ . .. ...... . ..... .... ..... 9 0,0 10 Marital deduction -- subtract IIn. 9 from IIn. 8......... ... ...... .., ..... 10 0,0 11 Charnebl. d.ductlon, bassd on nems i.ss exciusions ,., ., 11 0 . 0 12 Total deductions -- add IIn..10 and 11. . . . . . . . . . . . . . .. . ... ... .. . . . . .. . . . . . . . . . . . . . . . . . . . . , . . 12 13 Subtract line 12 from line 7 .. ............ ................ ......... ,........................ 13 14 Generallon-skipplng transfar taxas payable with this Form 709 (from Schedul. C, Part 3, col. H, Total). . . . . . 14 15 Taxable gffts (add lines 13 and 14). Enter here and on line 1 of the Tax Computation on page 1 . , . . . . . . . . . 15 -(If mare space is needed. attach additional sheets of same slze.) CAA 1 7092 NTF 2555648 GLO ~222 CllPyright2001 Grea.tland/Nelco - Forms Software Only 34,221. 00 0,00 34,221,00 0.00 34,221.00 10,000.00 24,221,00 0.00 24,221.00 0.00 24,221.00 Form 709 (2001) Form 709 (2001) Page 3 ~ Computation 01 Taxable GI1ls (continued} 16 Terminable Interest (QTIP) M_ Deduction. (Saalnstructions lor Une B of Schedule A) If 8 trust (or other property) meets the requirements of quaHfied terminable interest propertY under secroon 2523(f), and a. The trust (or other property) is lis1ed on Schedule A. and b. The value of the trust (or other property) is entered in whole or in part as a dedUClion on lme 8~ Part 3 0.1 Sch&dule A, then the donor shall be deemed to have made an election to have such trust (or other property) treated as qualified terminable interest property under section 2523(1). It less than the entire value of the trUst (or other property) that the donor has included In Part 1 of Schedule A is ente~g as a deduction on line 8, the donor shall be considered to have made an election only as to a fraction of the trust (or other property). The numerator of this fraction Is equal to the amount of the trust (or other property) deducted on line 10 of . Part 3, Schedule A. The denominator is equal to the total value of the trust (or other property) listed In Part , of Schedule A. If you make the OTJ? election (see instructions for line 8 of Schedule A), the terminabie interest property involved wiJf be Included in your spcuse's gross estate upon his cr her death (section 2044). ff your spouse disposes (by gilt or otherwise} of all or part of the qualifying Iffe income 1nterest, he OT she wm be considerea 'to have m8ete a transfer of the entire property that is subject to the gift tax (see Transfer of Certain Life Estates in the instructions). 17 Election Out of QTIP Treatment of Annuities o .. Check here If you elect under section 2523(f)(6) NOT to treat as qualtfted 1ermtnabre lmerest property any joint and survivor annuities that are reported on Schedule A and would otherwise be treated as qualified ~rrninabie lnteresl property under section 2523(f). (See Instructions.) Enter the Item numbers (!nom Schedule A) for the anntrilies fer which you ere making this election ~ ~ Glfta 1'\'On\ Prior Period. If you answered "Yes" on line 118 of page 1, Part 1, see the instructions for completing Schedule B. If you answered "'No," skip to the Tax CompUl1ltlon on page 1 (or Schedule C If applicable). , A C 0 Calendar year or B Amoum of unified Amount of specific E Internal Revenue office credit against gift tax exemptton'for prior Amount of calendar quarter where prior return was filed for periods alter periods end. be10re l8X8ble gifts (eee instructions} December 31., '\976 January 1, ,Q77 1995 jpHILADELPHIA, PA 40,900.0C 156,562.00 2000 i:INCINNATI, OH 13,635.6'1 42,611.48 1 =:m",:~~o~.~~~~s.:~~~.~~j~~~~'.Io~.~~~~~~fi~ 11 54,535.6" o.oe 199,1'13.48 2 Amount, ff any, by which total speclfio exemption, line " column D, is more than $30,000 . . . . . . . . . . . . . . . . 2 0.00 3 Total amount ofl8X8ble glltsior prior periods (add amoun~ column E, Une1, and amount, U any, on line 2). (Enter here and on Une 2 of the Tax Computation on page 1.). . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 199,173.48 (l1 more space is needed, attach additional sheets of same size.) CAA '1 7093 NTF 2555949 GLD SB50Copyrigbt 200' GreatlandlNelco - Forms Softw.,..-- Only Fonn 709 (2001) Form 709 (2001) ~~ Page 4 Computation of Generation-Skipping Transfer Tax t4ote: Inter vivos direct skips that ere completely excluded by the GST exemption must still be fully reported (including value and exemptions claimed) on Schedule C. . Part 1 -- Generation-SkippinG Transfers A B C D E F Item No. Value SprrtGiI1s Subtract col. C Nontaxabte Net Transfer (from Schedule A, (from Schedule A. (enter1/2 of col. B) (subtract col. E Part 2, col. A) Part 2, col. E) (see instructions) from cot 8 portion o~ transfer from col. 0) ;::;. . If you elected gtft.$plttting 8IId your 5POU1Ul Splft \lIfts from Value Included Nontaxable Net transfer was f1Iquinlltl1:o file a ssparabl Form rOE! spouse's Form 709 from spouse's (subtract col. E (see the instruction:!> for RSplitGlfts"), YOll (enter Item number) Form 709 portion of transfer from col. 0) mt,lst 8ntllr.1I of the gifts shown on Sehaclu\til A, Parl2. of your sJllluse'a Form S- 709 herll. In column C. enter the iam number of each S- gittin thv ord.rlt appears In column A of S- your $pou..':;Schedule A, Part 2. We h."tl I1fep.rm1ed tM. pt~nX"S-"t6 di$\W,9'"'"" 'I- S- spouse'. ttem numbers from YOllr own whan you complete coluf'lm A of Schedule C, S- Part3. S- In calumn 0, tor each gift, enter the amount reported In column C, Sehedu18 C. Pilrt 1, S- of your spouse'. Fotrl!. 709. S- Part 2 -- GST exemption Reconciliation (Seetlon 2631) and SectIon 26S1(a}{3) EleCtIon Check box .. Un you are makIng a sectlon 2652(a)(3) (special QTlp) election (see Instructions) Enter the ilem numbers (from Schedule A) of the gifts ior which you are making this election .. 1 Maxlmum allowable exemption (see Instructions) . . . . .. . . . . . .. . . . . . . . . . . . . . . . .. . . . . . . . . . . . . ..."... 1 1,060,000.00 2 Total exemption used for periods before filing this return. . , . . . . . . . . .. , . . . . . . . . . . . . . . . . . . . . . . . . .. . . , . 2 0.00 3 Exempt\on ava\lab\e ior '\his return {subtract Une 2 tram flne 1) . . . . . . . . . . . . . . . . . . . . , . . . . . . . . . . . , . . . . . . . 3 1,0~O.OOO.00 4 Exemption claimed on this retum (from Part 3, co!. C total, baiow). ..... . . . . . . . . . .. . . . .. . . . . . . . . . . . . . . . 4 0.00 5 ExemptiOn aHocated to transfers not shown on Part 3. below. You must attach a Notice of AHocation. (See . Instrucuons.) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ; . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 0.00 6 Add ~""" 4 an<! <; . . .. . . . .. .. .. . .. .. .. . .. .. . .. .. .. .. .. .. .. .. . .. .. . , . .. . .. .. .. .. . . . .. . .. . .. . . 6 0.00 7 Exemption ""aUable for future transfers (subtract Une 6 from Hna 3) . . . .. . ... . . . . . .. . . . . . . . . . . . . . . . . . . . . 7 1 060 000.00 Part 3 -- T.... Computation A B C D E F G H Item Nil. Net transfer GST Exemption Divide cot C Inclusion Rado Maximum Applicable Rate Generation-Sl<ipplng {frol1l (from Schedule C, (subtract co!. 0 Estate (muftlply cot E Transfer Tax Seh.C. Allocated by co!. B Part1) Part 1, col. F} 1rom 1.(00) Tax Hale \>yco!.!') (multiply co!. B by co!. G) 55% (.55) 55% (.55) 55% (.55) 55% (.55) 55% (.55) 55% (.5S) 55% (.55) 55% (.55) 55% (.55) 55% (.55) Total exemption claimed. Enter Total generation-skipping transfer tax.. Enter here, on here and on fine 4, Part 2, above. \ine 14 01 Schedule A.. Part 3, and on Une 16 o~ the. ,. ax. M"'J 00<"-__", \'1lrt 2. 0.00 above. . . . . . . .. . . . . . . . . . . . . Computation on page 1... .' . .. ... .. , . ..... .. . . ...... 0.00 (H more space is needed, attach addltlonalsheels of same size.) CAA 1 7094 NTF 2555850 GLD 5850 Copyright 2001 Gre.tland/Neleo - Form. Software Only Form 709 (2001) . Form 709 United States Gift (& Generation-Skipping Transfer) Tax Return ""'.N..,.......,. 0"'.............. T........,. (SecIlDn 8019 of Ihe.lnlllmal Flevenue Code) (For gifts made d\lring.calendar year 2000) Int.mal R.venU8 S.rvice' .... See separate instrUc:tIons. 1 Donor's first name and middle initial 2 Donor's laSt name 3 Donor's socia' securIW r'll:'mber r. PAUL SHARllETTS 209-12-8990 p 4 Address (number. street, and apartment rn.rmber) 5 L-oaIl'IIsldenc:e (domid'-\(co'""Y" state.) A 21 DEVONSHIRE SQUARE . CUMBERL1\ND =. ,PA ~ 6 CIty. state. and ZIP code 7 CIlizenliljip CHANICSBURG PA 17055 USA 1 8 If the donor died during Ihe year, check here ~ X arnlentardaleof_ 07/04/2001 . . G 9 ff you received an ex!. of time to file _ Form 7ll9. clleCk here ~ 0 & -.:h the Form 4868. 2688, 2350, or extension letter ~ 10 Enter the total numbel' of separ8le doneesllsllad on Schedule A -- count each pel$Oll only once. . . ~ 1 ~ 11 a Have you (the donor) previously filed a Form 709 (or 709-A) for ony other year? ff answer Is "No,. do not comple1e line.' 1 b . . X A 11b~the answarlO Une 11a ls "Yes: haB your addreOschangedsince you 18Sl1lled Form 709 (or709-A)? .... .... ...... .... L 12 Gift. bybuslland orwlfe t~ third partin. Do yea COftSQtto have th. gtfb (iRdudl"" genlntioa....klPpiflg tr..,....,) made by you and oy your r ."O~ to tilird partiea dwin. the"-'" ~cen~ _.0.0.".-"-" by..." o.f yacrf(S.. instnnrthnas.} (If th. IIIIlJwer is.......... -Uta N foHowlng information muat be fIIm'-bad and yaurSlloue muatlllp Uut CClft..m. .hewn H40w. F If the enower Is "No." ekIp pnee 1S-1S ondgotc Schedule A.). .............................................. ~ 13 Name of consenlf!1g _use 14 SSN ~ 15 Were you maniea 10 one another during lite entire calender year? (see in_ns). .. .. . . .. . . . . .. . ... .. . . . . . . . . . . . . T 16 ~ answer to 15 Is "No,' cIe. whether married divoreed or __. & give date (see inst) .... b 17 wm agifttox relum for this calender year be flied by your spouse? ......... ...............:...................... N 18 Consent of Spouee __ I ooneent1o have gltls("~k"P""_nol made by me and by my spo_ 10 ffllrd pertfes auring calendar year considered as made one-hd by each of us. W. Bnl both BWBnl of joint & several liability for lOX createa by execUtion of this consent C""""n1Ing a_'s eigmItuno ~ Dale ~ 1 ernertlle am<l\l<l\trom Sohedu\e A. Port 3. Une1S.. .................. ..................... 1 2 Enter1hearnount1romScheduIeB,lIne3......:................ ......:..............:.. 2 3 Total taxable gifts (add Unee 1 and 2).. . .. .. .. . . . . . . . . .. . . . .. .. .. . .. .. . .. .. .. . . . .. . . .. . . 3 4 Tax computed on amount on line 3 tsee Tallie for Computing Tax In _1nslruclIons) . . . . . . . . . 4 5 Tax computed on amount on line 2 (see Table for CompUting Tax In _ instructions) .' . . . . . . . 5 P 6 Balance (sub1ract line 5 from line 4). . .. . . . .. .. . .. . . . . . . . . . .. . . . .. . .. . . .. . . . . .. . .. . . . . . . 6 A 7 Maxlmum unified credll (nonresident aliens. sae InSlnlC1lonS) .. . . . .. .. . , .. . . .. .. :.. . . .. .. . . . . 7 ~ . 8 Enter the unified eredlt agBimlllax allowable for all prior periods (from Sch. B. line 1. col. C) . . . . . . . . 8 9 Balance {sub1ractlin. 8 from Una 7)..."... .. .. .... ... . .. .. .. . . . ..... . . .... .. .. . .. . ., .. . 9 2 10 Enter 20%(.20) of the omount_ as a specific exemptlon for gltls made aIlerSeptembars, 1976. T andbeforaJenuary1.1977{seeimmu_)................... .............. ........... 10 ~ 11 Balance {subtract line 10 from line 9)... .. . . . .. . .. . .. . . .. : . .. . . . .. . .. .. .. .. .. . . . . . . .. .. . 11 C 12 Unlfiederedlt(enter1he_rofilneeorline11)................. ........:.............. 12 o 13 Credll for foreign gilIllIi<es (see IlIlllIUCIione) ... . . ... . ..... . .. . . . . . .... .... . . ... .. .. . .... . 13 P A ~ 14 T A 15 IT 16 Co H N 17 ~ .18 E C I< or ~ 20 N E Y o R o E R H E R E. Total credlts(addlinee 12 and 1S). .................................................... Balance (subttaClllne 141rom line 6)(do not enter less than zero) . . .. . . .. . . . .. .. .. . . . . .. : .. .. Generatlon-sklpping transfer taXeS (from Schedule C,. Part 3. col. H. Total). . '. . . . . . . . . . . . . . . . . . . . 14 15 16 Total tax (add lInee 15 and 16). .. .. ... .. . ..... ............ . .. .., . .. . . . ..... .., .... ... . GIft and generatkin-sklpping transfer taXeS prapllid with extension of time 10 file . . . . . . . . . . . . . . . . . 17 18 19 If Una 16 is less than line 17. en...__tsee Instruclions). ............................ 19 .2000 x 42 6:1.1. 48 156 562.00 199,,,173.48 54,53.5..51 40,899.84 13, 635. 67 220._.00 40 900.00 179 650.00 0.00 179 6.50.00 13 635.67 0.00 13,635.67 0.00 0.00 0.00 0.00 0.00 Sign Here Illme 18 Is grealer than Une 17. enter_tc bersfunded............................... 20 Ull.d....~Gi"M~~ld.dan.t.l\cllba'A___dth.I1Ibml..~_y~~_IMMl...-~....1i'o'\'.b"'"*'1rl "''1 knowledg_ and benBt. It is tntfI, corrtIat, and aI~. DeclarUian,of pr4tparar(othertnu donor) ts ba5ad an.1I Information of which pr.parer has any ""aWl dID- ' ~ (717) -846-7000 Fonn 709 (2000) ~ , PrepBnl~S signature Firm's name ( ~er Co ~ioyed), ~7 East Market St ad_&ZlPcode York PA 17401 Phone no. For D1aclosure, Privacy Act, and PapenvorkReductton Act Not:lce, .. the _arste lIl_ons for thls 10"". CAA 0 7091 NTF 33255 GLD 4222 Copyrigbt 2000 G..-tIUd/NelcD LP- Forma Softwar. Only Pal" Preparer'e U~e Only LLP 0.00 Check If hlf-employaa ~ T l?AUL SllAlUlETTS SSN: 209-12-8990 A Item No. 1 Schedule A -- Part 1 G:i.fts Sul>ject On1.y to G:i.ft Tax B Donee's name, relati.onship to donor, add3:ea..., and. deac%':i.pti.on OTHER GIFTS :J:'HOMAS P. SllARRETTS (SON) 1143 COUNTRY CLUB ROAD CAMl? HILL, l?A 17011 CASH C Donor's Adj. Baai:e D Date of G:i.ft 52,611.48 12/31/2000 l?ag",: 1 E Value of Gi.ft ',. 52,611.48 52,611.48 Computation of Taxable Glfls (Includmg T'~ In Trost) A Ooes the velu. of any Item listed on Schedul. A reflect any veluetlon discount? If the enswer is "Yes," see instructions. . . . .. V.S No X S ~ Check here If you elect under section 529(c)(2)(6) to 11elIl any transfers made this year to a quelifled state tuition program as made ratably over. .-year period beglnning lf1Is year. See /nsInJCtions. Attach explanation. Part 1 -- Gills Subject Only to Gift Tax. GIfts less political organlzatlon, medical, and educetlonelexclusions -- see instruClions Fonn 709 (2000) Pag.2 A B C D E Item . Donee's name and address 0000(. &dju0le<l Oate Value aI . Relet10nship to donor (If any) number . O.scriptlon of gift basis of gift of gift date of gift . If gift was mode by means of trUst, enter truSl's E1N & attach . a description or copy of trUst inetrument (see instructions) . If the gilt was of securities, give CUSIP number See SeheduJ.e attached TOleJofP.rt1 (add amounts from Part1,column E) ......... ............................................ ~ 52,611.48 Pert 2 -- GIlls ThlIl.... D\reClSklps and are Subject to Both GlllTex and G.n.ratlon-Sldpplng Trenllfer Tax. Vou muallist the gifts In chronological order. GIfts less poJillcal organlzalion. medIceI. end .ducetlonal excluaions - see instructions. (Also list here direot skips that are subject only 10 th. GSTlex at this lima as the resuft of the termination of en "estate tax inclusion period." See instnJctIons.) A 6 . C D E Item . Oo,-'s name end eddress OOno(s adjusted Date Value at number . Relationship 10 donor (If any) b,,"",ol\llft 01 \lift dele ol 9"' . Descriptlon 01 gl!t . If gift was mode by meons of trust, enter trust's EIN & aIlech . description or copy of trUst inetrument (eee Instructions) . If lhe gift was of securllles. give CUSIP number Total ot Pert 2 ,.dd amounts from Part 2. column E) . . . . . .. .. .. .. . . . .. . .. .. . . . , . . . . .. . ... . . . . . . . . . . . . . . ... ~ Pert 3 -- TlIXable Gill Reconciliation 1 Tctal velue of gifts of donor (addtolelsfrom colurm EofPer1S1 end 2) ............................. 2 One-hell of kerns attributable to spouse (see Instructions) . 3 Belancs (subtreot line 2 from line 1) . . . . . . . . . . . . . .. .. .... . .. . .. .. . . . . . . .. .. .. . .. . . . . .. , . . . .. . 4 GIfts of spouse to be include<! (from Sch~1e A. Pert 3. line 201 spouse's return - see instructions). . . . . . . If any of the gifts Included on this lins are else subject to the generation-skipping transfer tax, check here ~ 0 and. el1ler those gifts also on Schedul. C. Part 1, 5 Total gifts (add Hnes 3 end 4) . . . .. . . . . . .. . ... . . . . . . ... ... . . . . . .. .. . . . . . ,.... ... . , . . ... . .. .. . 6 Total ennual.XelUsions for gifts listed on Schedul. A (including line 4, above) (see insllUctions) . . . . . . . . . . , 7 TOlallncluded amount of gifts (subtract line 6 from Une5) ........................,............... Deducllons (see instructions) 8 Gifts 01 interests to spouse for which a marital deduction will b. claimed, based on kerns ofSCh.duleA..............8 0.0 9 Exclusions attributabls to gifts on lln. 6. .. .... . . . ... . . ... .. . . . . . . . . .. .. 9 0.0 10 Marital deduction -- subtract Un. 9 from Une 6. . . . . . . . . .. . .. ... .. .. . . . .. 10 0.0 11 Charitabl. deduction. basad on kerns less exclusions ..... 11 0.00' 12 Total deductlons--add Hn"'0 and 11.. ..............................'..... ................ 13 SubtraCl Dn. 12 from Un. 7 ................................................................ 14 G.neratlon-sklpping transfer laxes payable with this Form 709 (from Schedule C, Part S. col. H. Totel). . . . . . 15 Taxable gifts (.dd lin.. 13 and 14). Entsr here end on line 1 ofth. Tax Computation on page 1 . . . . . . . . . . . (If more space is needed. attach additional sheets of oems size,) eM 0 7092 NTF 33258 GLD 4222 Copyright 2000 Graatland/Nafco LP - Forms. Softw.,. Only 0.00 52,611.48 0.00 52, 611 . 48 0.00 52,611.48 10,000.00 42,611. 48 0.00 42,611. 48 0.00 42,611.48 Fonn 709 (2000) Form 709 (2000) Page 3 ~ Compul81fOhof Taxable Gifts (con1lnued) 16 Termln_ Interest (OTIP) Marll8l Deduction. (See Instructions for Dne e of Schedule A.) ff a !rust (or other property) meets the requlremeJ1lS of qu8llfied terminable Interest property under section 2523(1), and a. The trust (or other property) is Ilstecl on Schedule A. and b. The value of the !rust (or other property) is entered in whole or in part as e deducDon on line e, part 3 of Schedule A, then the donor shell be deemed to have made an electlon to have such trust (or other property) treated as qualified terminable interest property under section 2523{f). ff less than the entlre value of the trust (or other property) that the donor has Included In Part 1 of SChedule A Is ente~ as a deduction on line e, the donor shall be considered to have mede an eIectlon only as to a fraction of the trust (or other property). The numerator of fhls Iracffon Is equal to the amount of the trust (or other property) deducted on line 10 of Part 3, Schedule A. The denominalOr Is equal to the total value of the !rust (or other property) listed In Part 1 of Schedule A. ff you make the OTIP election (see instructions for Bne e of SChedule A), the terminable interest property involved will be included In your spouse's gross estate upon his or her deafh.(section 2044). If your spouse disposes (by gift or otherwise) of all or Parlof the qu8lllying life income interest, he or she will be conslder9d 10 have made a transfer of the entire property that is subject to the gift tax (see Transfer 01' Certain Ute Estates In the Instructions). 17 Election Out of OTlP TRl8lmenl of Annulll.. o 4 ChecK here II you elect under eection 2523(1)(6) NOT to .treat as qu8llfied terminable Interest property any joint and survivor annullles that are reported on SChedule A and would otherwiae be _ as qualified terminable Interest property under aection 2523{f). (See Instructions.) Enter the Item numbers (/rOm SChedule A) for the anoullfes for WhICh you are making this election ~ ____ Gifts From Prior Periods If_ yOu answered .Yes" on line 118 of page 1, Part 1, see U1e Instructions for completing Schedule B. If you answered "No," skip to the Tax Computellon on page 1 (or Scbedule C, If appllceble). A C 0 Calendar year or B Amount of unified Amount of specific E Internal Revenue office credn against gift tax exemption for prior Amount of calendar quarter where prior return was filed for perlods -. periods end. before taxable QIIls (_1""""_""\ Decemb..... 31,1976 January 1, '917 1995 PHILADELPHIA, PA 40,900.00 156,562.00 1 =::or.~~~~.~~~~~.~~~~~ 11 40,900.0( O.O( 156,562.00 2 Amoun~ H any, by which 1Ota/ specifiC exempllon, line 1, column D, Is more than $30,000. . . . .,. . . . . . . . . . 2 0.00 3 Total amount of _Ie Q\I1s fo' p<la, pedad<< (aOd am<l\Int, oolumn E, "ns 1, 000 """"'0\ \l 8!Vj, on I 3 line 2). (Enter here and on line 2 of the Tax Cornpulation on pege 1.). ............................... 156,562.00 (If more apace Is needed, attach addllfonel sheets of same e/ze.) CAA 0 7093 NTF33267 GLD6860 CGpyriQht2000GnaatIMdlHeJr:ol"-F"'''_~ft_0n1)' Form 709 (2000) Form,709 (2000) ~ Computation of Generation-Skipplng 'Transfer Tax Note: Inter vivos direct skips lttat are completely excIuda<! by the GST exemption must still be fully reported (including value and exemptions c1almad) on Schedule C. Part 1 - Generetlon-SIdpp/ng Transfers Page 4 A B C D E F Item No. Value Split Gilts Subtract col. C Nontaxable Net Transfer (from Schedule A, (from Schedule A, (enter 1/2 of col. B) (subtract col. E Part 2, col. ") Part 2, col. E) (see Inslructions) from col 8 portion 01 tranmer from col. D) 1 ."....'<. 2 3 4 . 5 6 if you ehlcUid gift splitting and your .paun Spin gilts from Value Included Nomaxable Net transfer wu raqulrJild to 1Ue a ..parate Form 7011 spouse's Form 709 from spouse's (subtract col. E (.... the innructionafor"Split Gifta"), you (enIeI' IIem number) Form 709 portion of transfer from col. D) 1Il1.l~ en'hlt 811 of the gifts ahoWtl on Schedule A, ParU. of your 8POtlS8'. Forfll S- 7011 here. In column C, entar the ttern num"r of ...eft S- gtftin the order It appears in ealumnA of S- your 5pDU..'5 ScMdUcn" A., 'P1d"\ 2.. 'He h1m p~prinwd the "rtIfix"S-"w dis1!nguiah your S- SPOU_'& item m.._b.r. frol1l your own when you comp'-te colUmn A of Seh.duM C, S- Part3. S- In column 0, for uch gift, linter the am.ount teport.d in <:n1u1"lU\ C, Sd~'8dule C. Part 1, S- ot yourspousliII's Form 708. S- Part 2 -- GST Exempllon Rec:oncllllltion (Se<:tion 26311_ SectIon 21162{al(al E'-Icm Check box .. U II you are making a section 2652(0)(3) (special aTlPj eIec1ion (see Instructions) Enter the nom numbers (from Schedule A) of the gilts for which you are making this election .. 1 Maximum allowable exemption (see instructions) _........... _...... .. .. . . .. . . . . .. . . . . . . . . . . . . . . . . . 1 1,030,000.00 2 Tolal exemption usa<! lor periodS before filing this return ............................................. 2 0.00 3 Exemption availableforlhisretum(subtractline21romline 1)........................................ 3 1,030,000.00 4 exemption c1aimad on this return (from Pari 3, col. C total, below) . . .. . .. . . . .. . .. . .. .. . . . _ . .. . . . . . . . . .. 4 0.00 5 Exemption allocated to transfers nolshoW!> on Part 3, below. You must allach a Notice of Allocallon. (See instructions.) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . _ . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 0.00 6 Add lines 4 and 5 . . . . . . . . . . . . . . . . . ~ . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 0.00 7 exemption available for future lransfers (subtract tine 6 from line 3) . . . . . .. . . . .. .. . . . . . . . . . . . . . . . . . .. . . . 7 1,030,000.00 Part 3 -- Tax Computation A B C . D E F G H Item No. Net transfer GST Exemption Divide 001. C Incluslon Ratio Maximum /O.f'plicable Rate Generation-Skipping \tn>m (from Schedule C, (subttllC\ col. [) Es\a\e (TnI.ll\lpiy col. E Trans1er Tax 5oeh.C. Allocated by COI. 8 Part,) Part 1, col. F) from 1.000) Tax Rate by eol. F) (multiply col. 8 by col. OJ 1 55% (.55) 2 55%(.55) 3 55% (.55) 4 55% (.55) 6 55% (.55) 6 . 55% (.55) 55% (.55) . 55% (.55) 55% (.55) 55% (.55) Total exemption claimed. Enter Total ganeratlon-sklpplng nnsfer tax. Enter here, on here and em lloe 4., Part 2, aoo~. line 14 of Schedule A, Part 3, and on line 1601 ltte Tax May not exceed line 3, Part 2. 0.00 above. .. . . . . . . . . . . . . . . . . . . Computation on page 1............... . , . . . .. . ..... . .. 0.00 (If more space IS needed. attach additional sheets of same SIZe.) CAA 0 7094 NTF33258 GLD S850 COPYfight2QOOGrutlmui-fWa\ct! LP-formeSoftwareOnly Form 709 (2000) INRE: :IN THE COURT OF COMMON PLEAS :CUMBERLAND COUNTY, PENNSYLVANIA ESTATE OF I. PAUL SHARRETTS, : ORPHANS , COURT DIVISION Deceased :NO. 2001-00699 DISCLAIMER AND NOW comes, PATRICIA ANNE SHARRETTS, pursuant to the provisions of Section 6201 of the Pennsylvania Probate, Estates and Fiduciaries Code (20 Pa. C.S.A. Section 6201), and makes a written Disclaimer as follows: 1. 1. Paul Sharretts died on July 4,2001 and a Testamentary Estate was raised to the above captioned term and number. 2. In his Last Will and Testament dated August 8, 1988, the aforesaid 1. Paul Sharretts provided in Article IV a residuary trust, and further in said Article provided that; ARTICLE IV I give the residue of my estate, real and personal, to my Trustee, IN TRUST, to keep it invested and thereafter if my wife, PATRICIA ANNE SHARRETTS, survives me, during her lifetime: (1) The net income shall be paid to her, in quarterly or other convenient installments; (2) As much of the principal as my Trustee may from time to time to think desirable, taking into account funds available from other sources, for the health, support and maintenance of my wife or either of my sons, Timothy Bruce Sharretts and Thomas Paul Sharretts shall be paid to that person or shall be applied directly for those purposes; provided that none of the principal of this Trust shall be paid to or applied for the benefit of my wife unless the principal or the Marital Deduction Trust has first been exhausted. 3. The Disclaimant, Patricia Anne Sharretts, hereby disclaims any and all amounts, benefits, items or interest provided to and for her in the aforesaid Article IV of the Last Will and Testament dated August 8,1988. 4. This Disclaimer shall not be interpreted and shall not affect any other provision of the aforesaid Last Will and Testament dated August 8,1988 relating or providing bequests, amounts, benefits or interest to Patricia Anne Sharretts. 5. This Partial Disclaimer is irrevocable, and unqualified as to the interest disclaimed. 6. The Disclaimant hereby verifies that she has accepted no benefits, interests or items expressed or implied, of the aforesaid bequest in paragraph Article IV prior to making this Disclaimer. IN WITNESS WHEREOF, the Disclaimant has hereunto set his hand and seal this /1 day of ..J)ecem/)f'r ,2001. WITNESS: /)J@rL '---H,A:;,,~ ~ L~~ Patricia Anne Sharretts COMMONWEAL TH OF PENNSYLVANIA SS: COUNTY OF DAUPHIN "" Be it Remembered, that on \ ') p.~ - (Cj , . f , 2001, before me the subscriber, a Notary Public, personally appeared PATRICIA ANNE SHARRETTS, known to me (or satisfactorily proven) to be the person whose name is subscribed to the within Disclaimer and acknowledged that she executed the same for the purposes therein contained. WITNESS my hand and seal the day and year aforesaid. /--'; '~~~ ~~6 Nota . IC My Commission xplres: NOTARIAL SEAL . ANN J LONG. Notary Public P,tv at Hamsburg, Dauphin Coun" Mv Commission Expires Ocr 30. 20&3 ~~ ~,;':-; :.;:: rr, ~ f~" 2 ::J:: ?S I (J', f-j co ?,;1 -.!.' INRE: :IN THE COURT OF COMMON PLEAS :CUMBERLAND COUNTY, PENNSYLVANIA ESTATE OF I. PAUL SHARRETTS, :ORPHANS' COURT DIVISION Deceased :NO. 2001-00699 DISCLAIMER AND NOW comes, TIMOTHY BRUCE SHARRETTS, pursuant to the provisions of Section 6201 of the Pennsylvania Probate, Estates and Fiduciaries Code (20 Pa. C.S.A. Section 6201), and makes a written Disclaimer as follows: 1. I. Paul Sharretts died on July 4,2001 and a Testamentary Estate was raised to the above captioned term and number. 2. In his Last Will and Testament dated August 8, 1988, the aforesaid I. Paul Sharretts provided in Article IV a residuary trust, and further in said Article provided that; (2) "As much of the principal as my Trustee may from time to time to think desirable, taking into account funds available from other sources, for the health, support and maintenance of my wife or either of my sons, Timothy Bruce Sharretts and Thomas Paul Sharretts shall be paid to that person or shall be applied directly for those purposes; provided that none of the principal of this Trust shall be paid to or applied for the benefit of my wife unless the principal or the Marital Deduction Trust has first been exhausted." 3. The Disclaimant, Timothy Bruce Sharretts hereby disclaims any and all amounts, benefits, items or interest provided to and for him in the aforesaid Article IV(2) of the Last Will and Testament dated August 8,1988. 4. This Disclaimer shall not be interpreted and shall not affect any other provision of the aforesaid Last Will and Testament dated August 8, 1988 relating or providing bequests, amounts, benefits or interest to Timothy Bruce Sharretts. 5. This Partial Disclaimer is irrevocable, and unqualified as to the interest disclaimed. 6. The Disclaimant hereby verifies that he has accepted no benefits, interests or items expressed or implied, of the aforesaid bequest in paragraph Article IV(2) prior to making this Disclaimer. IN WITNESS WHEREOF, the Disclaimant has hereunto set his hand and seal this 1,\ day of t.e~ ,2001. WITNESS: .. /J {J~f (f. 'A, ~~~ Imothy Bruce Sharretts COMMONWEALTH OF PENNSYLVANIA SS: COUNTY OF DAUPHIN , Be it Remembered, that on '\).PG < ( 1 ,2001, before me the subscriber, a Notary Public, personally appeared TIMOTHY BRUCE SHARRETTS, known to me (or satisfactorily proven) to be the person whose name is subscribed to the within Disclaimer and acknowledged that he executed the same for the purposes therein contained. WITNESS my hand and seal the day and year aforesaid. I /- i / 'I~' d 14 ," \., ( -"'-7..," ' "' ~ Notary Public t___- ? My Commission Expires: .. NOTARIAL SEAL ANN J LONG, Notary Public City 01 HarrisbuIg, Dauphin County . Mv CommISsion EXpires Oct 30, 200~ '.:\Ul)l~) !~"~-' LZ: 9- 1:W~1 ZOo ~ 5aH .,;28 INRE: :IN THE COURT OF COMMON PLEAS :CUMBERLAND COUNTY, PENNSYL VANIA ESTATE OF I. PAUL SHARRETTS, :ORPHANS' COURT DIVISION Deceased :NO. 2001-00699 DISCLAIMER AND NOW comes, THOMAS PAUL SHARRETTS, pursuant to the provisions of Section 6201 of the Pennsylvania Probate, Estates and Fiduciaries Code (20 Pa. C.S.A. Section 6201), and makes a written Disclaimer as follows: 1. I. Paul Sharretts died on July 4, 2001 and a Testamentary Estate was raised to the above captioned term and number. 2. In his Last Will and Testament dated August 8,1988, the aforesaid I. Paul Sharretts provided in Article IV a residuary trust, and further in said Article provided that' , (2) "As much of the principal as my Trustee may from time to time to think desirable, taking into account funds available from other sources, for the health, support and maintenance of my wife or either of my sons, Timothy Bruce Sharretts and Thomas Paul Sharretts shall be paid to that person or shall be applied directly for those purposes; provided that none of the principal of this Trust shall be paid to or applied for the benefit of my wife unless the principal or the Marital Deduction Trust has first been exhausted." 3. The Disclaimant, Thomas Paul Sharretts hereby disclaims any and all amounts, benefits, items or interest provided to and for him in the aforesaid Article IV(2) of the Last Will and Testament dated August 8, 1988. 4. This Disclaimer shall not be interpreted and shall not affect any other provision of the aforesaid Last Will and Testament dated August 8, 1988 relating or providing bequests, amounts, benefits or interest to Thomas Paul Sharretts. 5. This Partial Disclaimer is irrevocable, and unqualified as to the interest disclaimed. 6. The Disclaimant hereby verifies that he has accepted no benefits, interests or items expressed or implied, of the aforesaid bequest in paragraph Article IV(2) prior to making this Disclaimer. IN WITNESS WHEREOF, the Disclaimant has hereunto set his hand and seal ~ / ]"17 day of , 2001. this WIT. NESS:... i {J~(~. ~ ---r-L.. U ~ Thomas Paul Sharretts COMMONWEALTH OF PENNSYL VANIA SS: COUNTY OF DAUPHIN Be it Remembered, that on'~ -('" (' - 11 subscriber, a Notary Public, personally appeared THOMAS PAUL SHARRETTS, , 200 I, before me the known to me (or satisfactorily proven) to be the person whose name is subscribed to the within Disclaimer and acknowledged that he executed the same for the purposes therein contained. WITNESS my hand and seal the day and year aforesaid. , (/I \ """ \ .A~_ "'- Notary Public --;- '1 ".-."~_./ ~-~ 6 ~ My Commission Expires: _.._ NOTARIAL SEAL J ANN J. LONG, Notary PubliC City of Harrisburg, Dauphin County · My Commission Expires Oct 30, 2Q~? - :1Ill-1~) li,~<) 82:: ZU 9- !:JVW ZOo \" };)tj '.:',_>~J8t:i H;()~,~I)~ RI:.v ')/.~I, This is ro certify r!lar the information Local Regislrar. The original certiflCIl h"re f;1vcn is correctly copied from an ongm/ ill be f()fwclrded lO the Stalc Viral Records 'trifleare of death duly tiled wirh lfice f(lr permanent filing, me as WARNING: It is illegal to duplicate this copy by photostat or photograph. No. ~~;C,\,/1H/[frp;~~..._ J.l\\1~'\..'t"'/ -~I(4'.. ,It'~/ '<~, "~~V !iii' ~ \~, !:f/Ei:. \~~ ~Qi' ~~: 11.i:~ ::'<'->', ..d ,~ ::. ',- , _~ '. ,I , -*,. , _ '/*' \~-"-""'=-- 'A~l '~~~~,__/.~~l -~-~rMEN1 ~\ ~ "", -;;''''''h''~N''"IIIIJ,,11 /7 "'-"'7'~ U-;';C.-Jt/ /"'<. '-7'2.-~7""'" Local Registrar . rel' f;:)r this cendrew:, $2.00 P 7431378 JUL 0 6 2001 Date ~Ae~V87 COMMONWEALTH OF PENNSYLVANIA. OEPARTMENl OF HEAL'TH. VIlAl RECORDS CERTIFICATE OF DEATH 1. I. AGI:(laOlBirll"lcl.vl Paul Sharretts lINOER1'l'EAR '.JHOE"1t)11l' 1.4-. o.yt. Houos WinIIl_ ." .. S''''1Efl\.(!>IUMI!EJl SOCIAL SECUJltTY NUMBER ~ Of OEC'iDENllh.. MId<ll., UHf) male .. 209 12 -8990 ~<-l OJi.11'iOf' BlRTI1 .Mon''',Oay,....1 """""'""''''''... sm..ooF","'O"c"......'II Harrisburg,PA' PlACE OF OERHICt.eckONy '>1'(1.- _'~"'''''!0Qn9on'''''''' ~l HOsPITAL; 'U_bU'..Rr E~O ;:-~'"'t ~)o 73 v... COONTY OF OERH ... Cumberland k. E. Pennsboro Twp ... oeCEDENl'SUSUAl OCCUf'RIOH KlNDOF lWSINESSIlNDU$TRV (~~~~~~:T Industrial 11.. Owner/Operator 11... Elect 0 latin oeQ;oeNT'! M....UNQ AOOAESS (51'"'. c~.~. ZIpC<ldlr1 OECEDEN1"S 21 Devonshire Square ~~~ Mechanicsburg, PA 17055 =~ white ... MAAlT...LSWUS-...... Nt;......M&n-*i,~. -...... Married SURVIVING SPOUSE l"......Il"""<TIlI.,.........,.l A. Fickes 1'h1.~ 'Ph. lU.OCJ v...___lModiro Hamnden Two. ... .... lhotbMl 01 m~ k"""'~. ~.thoet:url1ldllu..ll"", dIIle at'l(lplll'" $t.led elll'ld1<1\e\ 7, 2001 I.UNSE NUMBER FD013-340-L '" -. ..... Cumberland --"1 17d.D ~~=oI MDTHfR'S NAWEjf_"_ MIOalt. M.o.oS<>'_1 t. l;arr1e Sterrett IHPOAMANT'S t.IAlUNG ADORESS (Su_. CoIyfTown. SUI", l'll CoOe,I 21 Devonshire Square, Mechanicsburg, PA 17055 PUCEOf' OtsPOSmoli .>>-otC-.rv. C,....atory lOCRlOtt.CiIy/TOwrt, SW..l1clCodll <<"""'- Rolling Green Mem. Park Lower Allen Twp., Cumb. 21c. lUd. NALlEANOAODRESSOfFACIUTYParthemore FH & Cremation Inc. ".. 13 3 Brid e Street NewCumberland PA 17070 \.-lCEN$E l'NMIl.ER ORE SIGNED (Montll.Ollv........) "'- ... lNFQAt,lANT'SNJlME{T~P,~\ .. FATHeR'S NAME (hill. M-<<l" La"l Irvin L. Sharretts ,,,,. 2Oe. Patricia A. Sharretts METHOO OF DISPOSITION ...(X\ C.emelionO RemowafIron\SIIl'O ou...(Speo;:ttyl ''^'''' E OR PEIlSON N:.l'\MG .o.s SUCK Co.P 24. . as. 27. PlUIT I, Enl.rlt"diM.~s''''fUt_OI'COfT1l)Iocahor..wflietJCI_th.(lealh Oo""'.~l"ltMt_ L..OI'1ry.....ClUYoo._lOnoo .... .......S.C,o,sE REfERRED 10 MEPlC1ll..l'JtAMlNEFlICOAONUl? ...0 ...JO w.o..sANAUlOPSV PE:FlFORMED? l: weAE AUTOPSY FINDINGS """'lAlllEPfUOAro COloIPlETIOl'l OF CAUSE OFOEATH1 .~~~~ / h,/.-~ O\JE lOlCf'I i\SACONSEOUENCE OF) 4~ ~....h~ /h'__r DOE 10 lOA AS'" CONSEOUENCE OF) ~/#ir...-/ ~"--~''''_'''''<'''''~J OUETO(OAASACQNS[QUENCl; OF); r-<<.'/--.- as. '-'PP<<>x,~I. i=~~ 13l..-/J , :J .......~/4~ , :J -:-.......1 PARTn: OI:lMt&il}ntbN.~<:OrlI~IO_lh.'ou'l 1JOttUl<~ln9intn.UtIde<Jying_~"'PARTI. IMMEDI....TE CAUSE (1'0li8l -"CII<:O<l<l~"'" '~"'d_)__ ~l;stCOlld....... /IMY.IudiIlgIO~ _,E"leoUJtOVll.YINQ CAUSI (0.-01 "'IUty f\iIItontlill8d._ '-......0 ",....,.,) LAST UNIINEAOf O€AfH OATEOFINJURV (Monlft,~.'t'ear) TIME OF INJUAV tNJURV1if~K1 oeSCRIBE HOW INJURY OCCURRED. Nllur. [] I') II I<\om"... o [] [1 PLACEOFINJUR'l' "Lt.....,,;;:-t~m.";I'~.!.<:I~Qi"IM;. ~ DuIIdin!I. ,"e. ISpecJ.1 'h, '" 0 ~D Aec...nl P.nd'ngl<1_iilat.", _. [] " ...rJ ~U ""... c"u\,;"'>lbeo6el."n'..... a... 2.11. URTIFllER IC~ee~ orMy """'I 'CEf!TJFYINQ PHVSICIAN IPhy,"".an""'\ll>j"'9~d -. ""'''''dflOl''''' P"YSIC:'anhaSI"or<""flU<l""al~ anoC<ltllplete<l rt...-n 231 To_ b..1 0''''' k_MdV-. d..'" oceuned C1...",1t,. e....8(.).nd mln.,., as .,....,.. ", [] 'PAQNOUN<;IHG AND eEATIF V'NO 'HVSI(IAH tPtlyu.:..... b.>tl' "''''"~''' '""J \l\l.o\tl and ~"'l~Y.", 10~'" ul <1...1:/>1 To_tMs<101 m,k""",led<;lft. d..IhOCC.........IIheUme. dII~. 'ncIpll... .nddu.lol...uuao(.).,.................I.I.... OATtSlONltl(Moo'IIl_o.y,\Wfl [J 31e. ld. .7v/> .r;..1d"" NItM€ .<.NO AOOf'!ESS OF PERSQt<I WHO COMPlEl'ED CAUSE OF OE1ifH (lIem27) Typ<3 Q{p,mt ...EDICAL EXAMINER/CORONER OrlII1.b.lIoilloot..'mln.llonllondlOlln\l.$llg...'ij)n.;ntnvopi"'o~.d,"elhoee....".'.h'"lItn..d...le.lndpl..ee..ndd..elolh.~....cl.J.od m.nn.'...III.-6,.... .. .... ......... ..........._.,......,. ....... ...._....._...... .... '" """""'''"'''''':2"" .-~ rI'<--------- I~ /~,~ .z '/:/'7o$.--.p('../ _~ [] /_" k "s._" J~ 32. ...........-...,,)~t. ",RA /~II>S-:r OATEFILEDIMO."h Oay,V"".. ,. U.Z, ~I____ 1l.La5t Mill aub Qre5tameut OF I. PAUL SHARRETTS I, I. PAUL SHARRETTS, of Camp Hill, York County, pennsylvania, being of sound mind, memory and understanding, do make, publish and declare the following to be my Last Will and Testament, hereby revoking and making void all wills, codicils and testamentary dispositions by me at any time heretofore made. ARTICLE I I order and direct that all my debts and funeral expenses shall be fully paid and satisfied by my Executor hereinafter named as soon as conveniently may be after my decease. ARTICLE II I give all my articles of personal or household use, including any automobiles, to my wife, PATRICIA ANNE SHARRETTS, if she survives me. If my wife, PATRICIA ANNE SHARRETTS, does not so survive me, I give all such property to such of my sons, TIMOTHY BRUCE SHARRETTS and THOMAS PAUL SHARRETTS as so survive me, to be divided among them as they may agree, or in the absence of agreement, as my Executor may think appropriate. ARTICLE I II If my wife, PATRICIA ANNE SHARRETTS, survives me, I give the fractional share of my estate necessary to reduce the federal estate tax falling due because of my death to the lowest possible figure to my trustee, IN TRUST, to keep it invested. And thereafter: A. During my wife's lifetime: (1) The entire net income shall be paid to her, at least quarterly; and as much of the principal as my Trustee may from time to time think desirable, taking into account all funds available from other sources, for her health, support and \ maintenance, shall be paid to her. I intend my Trustee to use principal liberally for my wife to enable her to maintain insofar as possible the standard of living to which she has been accustomed during my lifetime. B. On my wife's death: (1) Any increase in death taxes or administration expenses in her estate caused by the inclusion of a portion of this trust in her estate for tax purposes shall be paid out of the principal of such portion, except to the extent that a specific reference to the trust in her will provides for payment of such taxes and expenses from other sources; and (2) The balance of the then remaining principal shall be paid to such one or more of my descendents on such terms as she may appoint by a will specifically referring to this power of appointment; or in default of appointment or insofar as it is not effective, shall be added to and thereafter treated as a part of the principal of the residuary trust. ARTICLE IV I give the residue of my estate, real and personal, to my Trustee, IN TRUST, to keep it invested and thereafter if my wife, PATRICIA ANNE SHARRETTS, survives me, during her lifetime: (1) The net income shall be paid to her, in quarterly or other convenient installments; (2) As much of the principal as my Trustee may from time to time think desirable, taking into account funds available from other sources, for the health, support and maintenance of my wife or either of my sons, TIMOTHY BRUCE SHARRETTS and THOMAS PAUL SHARRETTS shall be paid to that person or shall be applied directly for those 2 I . purposes; provided that none of the principal of this trust shall be paid to or applied for the benefit of my wife unless the principal of the marital deduction trust has first been exhausted. B. After my wife's death, or mine if I survive her, the then- remaining principal shall be paid: (1) In equal shares to such of my son's, TIMOTHY BRUCE SHARRETTS and THOMAS PAUL SHARRETTS as are then living; provided that if either or both of my sons is not then living but has then- living issue, such issue shall receive, per stirpes, the share such son would have received had he been then living. ARTICLE V In calculating the fractional share of my estate to be allocated to the martial deduction trust, (i) the unlimited marital deduction allowed by the Economic Recovery Tax Act of 1981 shall apply to my estate, (ii) the fraction shall be calculated as if my Executor elected to qualify the entire marital deduction trust for the marital deduction in my estate, (iii) the final determinations for federal estate tax purposes in my estate shall control, (iv) the value of any property which qualifies for the marital deduction in my estate but which does not pass under this instrument to the marital deduction trust shall be taken into consideration, and (v) the fraction shall be reduced to the extent necessary to give my estate the full benefit of all other deductions and credits allowed in calculating the federal estate tax in my estate (but only to the extent so doing does not increase state death taxes). For the purpose of computing the fractional share and making distributions to the marital deduction trust, "my estate" shall mean my net probate estate, but without any deduction for death taxes. No property ineligible for the marital deduction shall be distributed 3 to the marital deduction trust. ARTICLE VI My wife shall be deemed to have survived me if the order of our deaths is not clear. ARTICLE VII All federal, state and other death taxes payable because of my death on the property forming my gross estate for tax purposes, whether or not is passes under this will, shall be paid out of the princial of my probate estate so that the burden thereof falls on my residuary estate (or, to the extent my residuary estate is insufficient, from the portion of the marital deduction trust which my Executor elects not to qualify for the marital deduction), and none of those taxes shall be charged against the portion of the marital deduction trust which my Executor elects to qualify for the marital deduction, any beneficiary or any outside fund. This provision shall not apply to generation-skipping transfer taxes. ARTICLE VIII I direct my Executor to exercise any options available in determining and paying death taxes in my estate in such a way as reasonably may be expected to achieve the greatest overall tax savings for my family, without regard to any effect upon the size of the marital deduction trust and without requiring adjustments between income and principal. I give my Executor complete discretion in dividing my estate into the two trusts aforedescribed, taking into consideration the appreciation factor of assets. ARTICLE IX No beneficiary under the aforementioned trust shall have the right to anticipate any payment or payments herein provided for or 4 to give, grant, sell, assign or transfer or in any way or manner dispose of any right herein given, save only, of course, that after any beneficiary receives his share of the income or payments as herein provided, he may then freely use and dispose of the same as his pleasure may dictate, and provided further, that both the principal and income of the trust fund while in the hands of the Trustees shall be and remain free from any and all debts, contracts and engagements of any of the persons beneficiary under the trust. ARTICLE X Without limitation of the powers conferred upon them by this Will, by statute or rule of law, any fiduciary under this Will is specifically authorized and empowered to retain, purchase or otherwise acquire without restriction any stocks, bonds, mortgages, notes or other securities, or other variety of real or personal property, even though such property may not be of the character allowed by law; to sell, lease, pledge, mortgage, exchange, convert or otherwise dispose of any property at any time forming part of my estate, in such manner including public or private sale, at such times, for such purposes and for such prices and upon such terms and conditions as said fiduciary shall deem advisable; to borrow money whenever in their judgment it may be advisable, and as security to mortgage or pledge any property forming part of my estate on such terms and conditions as said fiduciary may deem advisable; to compromise or otherwise adjust any claims or demands in favor of or against my estate; to continue, manage and operate any existing business or enterprise in which I may have an interest as proprietor, partner or principal stockholder at the time of my death, and any interest therein, for as long a period as to them shall seem advisable or desirable in the best interests of my 5 estate, and in so doing to renew, reissue or to make originally all forms or evidences of indebtedness binding my estate for the payment of such sums as they may think necessary with like power to exercise this right to bind my estate by endorsement or negotiable paper or other forms of instruments and/or to settle, discontinue, liquidate or sell said business or interest therein, at any time, at public or private sale, upon such terms, for cash or on credit, with or without interest, in such manner and at such prices as in their judgment and discretion may be proper, advisable or advantageous, to make distribution, division or apportionment in kind and to cause any share to be composed of cash, property, or undivided fractional shares in property different in kind from any other share; to execute and deliver such instruments as may be necessary to carry out any of these powers; and to do all other acts which any fiduciary under this will may deem necessary or desirable for the proper execution or discharge of any powers or duties held or imposed upon them, whether by the terms of this Will or by law, any fiduciary under this will to have all of the discretion and power to do or refrain from doing any or all of the foregoing things to the same extent and as fully, in all respects, as I could do myself if living. ARTICLE XI I nominate, constitute and appoint my sons, TIMOTHY BRUCE SHARRETTS and THOMAS PAUL SHARRETTS, and FRANK M. BALSBAUGH. JR., as Co-Executors of this, my Last Will and Testament. I nominate, constitute and appoint TIMOTHY BRUCE SHARRETTS, THOMAS PAUL SHARRETTS and FRANK M. BALSBAUGH, JR. as Trustees of the Trusts created herein. I hereby relieve my personal representative from 6 the necessity of posting security in connection with his duties as such in any jurisdiction in which he may be called upon to act insofar as I am able by law to do so. IN WITNESS WHEREOF, I, I. PAUL SHARRETTS, have to this, my Last Will and Testament, written on seven (7) sheets of paper, set my hand and seal this BH, day of U...LeJ<.LiX , 1988. AI " , II. i . (".\ i <4</~(,,$, '1. Paul Sharretts (SEAL) Signed, sealed, published and declared by the above-named I. Paul Sharretts, as and for his Last Will and Testament, in the presence of us, the subscribing witnesses, who, at his instance and request, and in his presence and the presence of each other, have hereunto set our hands the day and year aforesaid. ...lj'>1< 6t;'~c.-~/ ",r,.1~>C.7/J'> ;tJl./L'- /-//1(.>- Address ' J.iu~ /!tJ , Address J Name 7 COMMONWEALTH OF PENNSYLVANIA SS: COUNTY OF DAUPHIN We, I . { , / , 'J PAUL SHARRETTS, ~,l-J,,~,l , \.::- JI . \ -~'1 . {<..., I' '( \ and , the Testator and the witnesses respectively, whose names are signed to the attached or foregoing instrument, being first duly sworn, do hereby declare to the undersigned officer that the Testator signed the instrument as his Last Will and that he signed voluntarily and that each of the witnesses in the presence of the Testator at his request, and in the presence of each other, signed the Will as a witness and that to the best of the knowledge of each witness, the Testator was at that time 18 or more years of age, of sound mind and under no constraint or undue influence. ! ~,' .~ 'Y/( t;..< f)/-I~<-uLIf', Testa~or - I. PAUL SHARRETTS '-) . /7 L l , ,,:,4 r VTj'~2 {l,c-..'{({}, , &,\ ' Witness Sworn to and subscribed before me by I. PAUL SHARRETTS, the Testator, and subscribed and sworn to before me by J.~ i, '\ i.J., e.~.~H' If and r:.:;,..",., ,,-\. /+, WL~: ._, the witnesses, on thls ~~ day 9f August, 1988. - / , \ . \ \ j , r: 1'--'-.-'- /-7",v~'\,,--- Notary PUbl*~1 y omm~~1<6(rSf pJ.res: ANN J. lONG, Notacy Publ;, HaH.isburg, Ddl~phin County, Pa. My Commis~i~~~i!€s Dee, 29, 1991 8 COMMONWEALTH OF PENNSYLV ANlA COUNTY OF CUMBERLAND } SS: Register's Office MARCH 19.2002 I MARY CLEWIS Register for the Probate of Wills and granting Letters of Administration for the County of Cumberland, in the Commonwealth of Pennsylvania, do hereby certify the foregoing to be a true and accurate copy of the LAST WILL AND TESTAMENT OF 1. PAUL SHARRETTS, LATE OF HAMPDEN TOWNSHIP, CUMBERLAND COUNTY, PENNSYL V ANIADECEASED, TOGETHER WITH THE FOLLOWING PROBATE PAPERS, NAMELY: PETITION FOR PROBATE AND GRANT OF LETTERS TEST AMENT ARY, OATH OF PERSONAL REPRESENTATIVE, DECREE OF PROBATE AND GRANT OF LETTERS TESTAMENTARY AND CERTIFICATE OF GRANT OF LETTERS TESTAMENTARY. WILL BEING ESTATE 21-2001-699 as the same remains on file and of record in this office. .....~...~...... ~...:.... ::!":'/r,", ...:~.;;>.....c.~. "4 ~~ ,........6. ~.. .';:. "- ;..::: .... ~ .. "..- ~; '/': ' .. .. -= '" ....,. - i - .. ... . ~ ~..- ~ ~..~2:'"'::. .-;.-", -"" - ~ In testimony whereof, I have hereunto set my hand and official seal at Carlisle, the date above. Beard Miller CQ.mF~Y---- (\~\titl~\l P'.1.\,^_,\it ,I\C';:OT,nt;:n~t~~ ~\T)d C (':~i':';LJltYnt~. IBDO SEIDMAN ALLIANCE '.- .~., ~\ :'" ij,(fcHfr'jn, . H;UiOV<'?Y . . .. 'VfW~ October 25, 200] David A. Wion, Esquire Wion, Zulli & Seibert ] 09 Locust Street P.O. Box 1121 Harrisburg, PA 17108-1121 Re: Estate of!. Paul Sharretts Sharretts Plating Co.. Inc. Business Valuation Dear Attorney Wion: As requested, we have updated the previous Beard Miller Company LLP business valuation analysis for Sharretts Plating Company, Inc. (hereafter referred to as Sharretts or the Company). This update was performed to determine a value as ofJuly 4, 2001. The purpose of this update is to assist in the preparation of the death tax returns of!. Paul Sharretts, who passed away on July 4, 2001. The attached schedule follows the same format, as in our prior valuation reports, dated December I, 1995, and January 16,2001. The 1995 valuation was performed in conjunction with a stock recapitalization of Sharretts, including the gifting of stock by Mr. Sharretts to his two sons. Also, it is our understanding that just prior to the October 1995 recapitalization, shares of stock in Sharretts were bought/sold between Mr. Sharretts' sons and an unrelated (non-family) shareholder at a price per share less than the equivalent per share price determined in this valuation. The 2001 valuation was performed in conjunction with a divorce of one ofMr. Sharretts' sons. This valuation was performed following the methodology determined appropriate in the full 1995 analysis. It is again our understanding that the divorce settlement reached utilized the valuation conclusions presented as part ofthe BMC 2001 analysis. This agreement was reached only after review of the BMC conclusions by an opposing attorney and financiallbusiness valuation expert. Accordingly, we believe the valuation methodology developed in 1995, and subsequently followed in January 2001, is applicable as of July 2001 for determining the value ofMr. Sharretts' ownership interest in the Company. As in the past two valuations, we have again concluded that there currently is no goodwill value associated with the Company. Accordingly, it is believed that the highest value would be achieved through a liquidation ofthe Company's assets in an orderly fashion, over a reasonable period oftime, to recognize the highest possible cash equivalent. Tbe attached Schedule L Market Value and Liquidation Adjustment Schedule, reflect a net liquidation value of$718,000 (rounded). This liquidation value was based upon the December 31, 2000, reviewed financial statements with updated information provided to us by management as of June 30, 2001, and considering the adjustments reflected in the schedule. We do not believe there were any material changes in value between June 30, 2001, (the most recent information provided to us) and July 4, 2001, the exact date 1. Paul Sharretts died. The values for the assets follow the same assumptions as outlined in our previous valuation reports. It should be noted here that the historical reviewed financial statements are prepared on the modified cash basis, and as such, certain items such as accounts receivable, accounts payable, and inventory are not recorded on the balance sheet of the Company. Based upon discussions with management, we have included accounts receivable in the amount of $223,720. Per management, accounts payable at year end would be very minimal. While there may be some unpaid utility or miscellaneous bills outstanding, these liabilities would be immaterial and as such, in order to be conservative. we have not 'iii . David A. Wion, Esquire Re: Estate of I. Paul Sharretts - Sharretts Plating, Inc. Business Valuation October 25,2001 2 included these liabilities. We did, however, provide a small allowance on liquidation for costs and fees associated with final accounting and legal matters. The Company operates on a ':iust in time" inventory system. As in the past, management has again indicated to us that the value of the inventory for liquidation value purposes was $0. In fact, once the chemical inventory is mixed, it becomes more of an environmental liability to the Company than an asset. No one would buy this inventory. To be conservative, as opposed to recognizing a liability for these chemicals, we have left the inventory balance at $0. The tangible assets of the Company were valued based on an estimated percentage of original cost basis. This percentage was determined in conjunction with management and based on our past experiences. In reference, specificaily to the machinery and equipment, many of these assets are very old and have been modified over the years for the specific needs and circumstances of each customer's request. It would be extremely difficult to sell this equipment in any type of a liquidation situation. The indication of value presented above represents the fair market value ofthe ownership interest of the Company. Fair market value is defined as the price, expressed in terms of cash equivalents, at which property would change hands between a hypothetical willing and able buyer and a hypothetical willing and able seller, acting at arms length' in an open and unrestricted market, when neither is under compulsion to buy or sell and when both have reasonable knowledge of the relevant facts. As discussed with various representatives of, and advisors to, the Estate, this valuation letter report is limited in its discussion regarding information utilized in the valuation process. We were engaged to calculate an indication of value of the Company where the scope of the valuation procedures was limited. We were also limited in the amount of discussion made in this report. The specific discussion and analysis omitted includes a detailed history of the Company, a detailed overview of the industry and market in which the Company operates, a detailed analysis of current economic conditions, detailed descriptions of all normalization adjustments, conclusions of ratio and industry comparative analysis, and a full listing of the sources of information utilized in reaching our indication of value. If the omitted discussions were to be included in any additional narrative report for this particular valuation, they might influence the users level of understanding regarding the indication of value that is contained in this report. If you feel it is appropriate for us to provide any or all of this additional narrative and analysis, please let uS know. You should also note that the balance sheet presented on the attached Schedule I, and specifically the Liquidation Value found at the far right-hand column, reflects no amount for either known or unknown environmental liabilities. Management indicated that there are certain environmental concerns present as of the balance sheet date. In addition, there may be some additional liabilities that are unknown and therefore not currently quantifiable. These would certainly make the Company more difficult to sell and likely result in a lower net realizable value on liquidation. The liquidation value indicated on Schedule I also assumes the ability to force a sale ofthe Company's assets and thereby recognizing the net cash proceeds. 1. Paul Sharretts was not in a majority equity position (although he did own a majority ofthe voting stock) and therefore may have been limited in his individual ability to force liquidation. To the extent a lack of control discount is appropriate for the purpose in which this valuation is being done, empirical evidence would easily support a discount level in excess of 20%. This would further reduce the fair market value indication of the business. Overall this amount is not material to this valuation and we have not included such a discount. David A. Wion, Esquire Re: Estate of I. Paul Sharretts - Sharretts Plating, Inc. Business Valuation October 25,2001 3 In summary, on July 4, 2001, I. Paul Sharretts owned 2.38% of the equity of the Company. Accordingly, his ownership interest would have a value equal to its liquidation value or $17,100 (rouuded) of the gross liquidation value. While a 2.38% interest is definitely a minority position, no minority interest discount has been taken as Mr. Sharretts did in fact own voting control. On the other hand, no premium was associated with voting coutrol as the financial performance of the entity does not support any goodwill value and the henefits of owniug a controlling position iu Sharretts are not seen as any additional value above the net realizable proceeds on liquidation. The following limiting conditions apply in the development of the indication of value and to the use of this letter report: I . This letter report is an economic report designed to provide a review of the market value as well as the economic impact of a variety of purchase structures. It is not an accounting report and it should not be relied upon to disclose hidden assets or to verify financial reporting. It is an indication of value of the specific assets and liabilities considered. 2. This engagement does not provide a Conclusion of Value as defined by the Professional Standards of the National Association of Certified Valuation Analysts. More analysis and or disclosure would be required to express such a conclusion. Therefore, this engagement should not be referred to, used or relied upon outside of the specific consulting purpose for which it was stated. 3. The summarized historical information referred to and presented throughout this letter report and on the attached schedule is included solely to assist in the development of the value indication presented in this report and it should not be used to obtain credit or for any other purpose. Because of the limited purpose of this presentation, it may be incomplete and contain departures from generally accepted accounting principles. We have not further audited, reviewed, or compiled this information and, accordingly, express no assurances on it. 4. Some ofthe financial information presented throughout this report includes normalization adjustments made solely to assist in the development of the indications of value presented in this report. Normalization adjustments are hypothetical in nature and are not intended to present restated historical results or forecasts of the future in accordance with AICP A guidelines. This information should not be used to obtain credit or for any purpose other than to assist in this valuation and we express no opinion or any other assurances on this presentation. 5. We have relied on representations made by you about the background, history and potential performance ofthe business. These representations are believed to be reliable but no responsibility is assumed for their accuracy. 6. This report was prepared for use by the advisors to the Estate in connection with the estate tax returns for I. Paul Sharrets. Possession of this report, or a copy thereof, does not carry with it the right of publication of all or part of it. This report may not be used for any purpose, other than that specified above, and may not be used by anyone but the advisors to the Estate without written consent of Beard Miller Company LLP and, in any event, only with proper attribution. 7. All facts and data as set forth in this report are true and accurate, to the best of the analysts' knowledge and belief. However, we assume no liability for such sources. No matters affecting the indication have knowingly been withheld or omitted. David A. Wion, Esquire Re: Estate of I. Paul Sharretts - Sharretts Plating, Inc. Business Valuation October 25, 200 I 4 8. The valuation contemplates the historical financial facts and conditions existing as of the date of valuation. Events and conditions occurring after that date have not been considered and we have no obligation to update our report for such events and conditions. 9. The indication of value presented in this report applies to this valuation only and may not be used out of the context presented herein. This valuation is valid only for the purpose or purposes specified herein. 10. This report is intended to provide an indicated value for the ownership interest described above. No liability for receiving said value is assumed by Beard Miller Company LLP. This report is neither an offer to sell nor a solicitation to buy securities in the Company. This report was prepared under the direction of Gregory A. Crumling, CP A1ABV, CV A. Glenn R. Spinello, CPA, CV A, CMA provided significant assistance in the analysis and/or preparation of this letter report. Neither the professionals who worked on this engagement, nor the partners of BMC, have any present or contemplated future interest in the Company, any personal interest with respect to the parties involved, or any other interest that might prevent uS from performing an unbiased valuation. BMC's only involvement with Sharretts in the providing of ongoing accounting, taxation and related financial services. Similarly, BMC's only involvement with the Estate of I. Paul Sharretts in financial related consulting and assistance as request with Estate administration matters. The analyses and indication of value were developed, and this report has been prepared, in conformity with the Uniform Standards of Professional Appraisal Practice (USP AP) of the Appraisal Foundation, to the extent that they are not in contradiction to the Standards adopted by the American Institute of Certified Public Accountants and the National Association of Certified Valuation Analysts. This Letter Report has been prepared in accordance with the National Association of Certified Valuation Analysts' Report Writing Standards. Please do not hesitate to contact us with any questions that you may have or if additional information is needed. We appreciate the opportunity to work with you in this matter and to provide assistance to the Estate in the filing of the death tax returns. Sincerely, BEARD MILLER COMPANY LLP GORY A. CRUM G, C A1ABV, CV A ffL,fi- //J //!/ 4fr:'E~ R. {p'~ /!.PA, CV A, CMA GAC/GRS/tmc Enclosure c: Thomas P. Sharretts W. Robert Berkebile, CP A1PFS, CFP F:\BUSV AL\! t !Archive\SharettPlat\SharrettsPlaiing\OI Oct25LtrRep.doc SHARRETTS PLATING COMPANY, INC. MARKET VALUE AND LIQUIDATION ADJUSTMENT SCHEDULE Schedule I Adjusted Liquidation Book Value Market Book Value OR Value June Value June Liquidation June 2001 Adjustment 2001 Amount % 2001 Cash & cash equivalents 187,311 187,311 100% 187,311 Net accounts receivable 0 223,720 223,720 95% 212,534 Inventory 0 0 0 0% 0 Total Current Assets 187,311 411,031 399,845 Mach1nery and equipment 1,617,062 (1,131,943) 485,119 264,587 264,587 Transportation equipment 114,175 (45,670) 68,505 39,093 39,093 Office equipment 84,515 (42,258) 42,258 18,297 18,297 Less: Accum. Depr. (1,479,732) 1,479,732 0 0 Net Property and Equipment 336,020 595,881 321,978 Total Other Assets 0 0 0 Total Assets 523,331 1,006,912 721,823 Accounts payable 0 0 0 3,500 3,500 Total Current Liabilities 0 0 3,500 Total Long-Term Debt 0 0 0 Total Liabilities 0 0 3,500 Common stock 400,000 400,000 0 Paid-in capital 18,000 18,000 0 Retained earnings 105,331 588,912 718,323 Total Stockholders' Equity 523,331 1,006,912 718,323 Total Liabilities and Stockholders' Equity 523,331 1,006,912 721,823 The financial information presented on this schedule includes normalization adjustments made solely to assist in the development of the value conclusions presented in this report. Normalization adjustments are hypothetical in nature and are not intended to present restated historical results in accordance with AICP A guidelines. This infonnation should not be used to obtain credit or fQ\' any pu~es othCT than to assist in this valuation, and we express no opinion or any other assurances on this presentation. ,.._"..,.,..."..~,..,,_.. Beard Miller Com12an~ LLP Certified Public Accountants and Consultants . Pennsylvania Inheritance Tax Return Estate of I. Paul Sharretts 000: 7/04/2001 Social Sec. # Cumberland PA No. 21-01-0699 Schedule C Attachment ] SHARRETTS LIMITED PARTNERSHIP VALUATION REPORT As of July 4, 2001 Beard Miller ComRan~ LLP Certified Public Acoountants and Consultants BOO SEIOMAN ALLIANCE Allentmvn + Hanover + Harrisburg Pittsburgh + Reading + York November 19,2001 David A. Wion, Esq. Wion Zulli & Seibert 109 Locust Street P. O. Box 121 Harrisburg, P A 17108-1121 Re: Sharretts Limited Partnershio ("SLP") Dear Mr. Wion: In accordance with your request, we have prepared a valuation of the fair market value of a 49.5% limited partnership interest in Sharretts Limited Partnership on a minority, non-marketable basis, as of July 4, 200 I. It is our understanding that our opinion is sought for estate planning purposes. The term "fair market value" can be defined as: "The price, expressed in terms of cash equivalents, at which property would change hands between a hypothetical willing and able buyer and a hypothetical willing and able seller, acting at arms length in an open and unrestricted market, when neither is under compulsion to buy or sell and when both have reasonable knowledge of the relevant facts. " Based on our study and analysis herein, it is our opinion that the fair market value of a 49.5% limited partnership interest in Sharretts Limited Partnership on a minority, non-marketable basis, as of July 4,2001 is $ 432,000 (rounded). Our report is based on information obtained by us from management, a real estate appraisal report prepared by Clauser Real Estate Appraisals and other data outlined in Appendix D. Users of this report should be aware that business valuations are sometimes based on the business' ability to either replicate past performance or achieve future earnings potential that mayor may not materialize. Therefore, the actual results achieved in the future may vary from the assumptions used and conclusions reached in this valuation. We have no present or contemplated financial interest in SLP. Our fee for this valuation is based on our normal hourly billing rates and is in no way contingent upon the results of our findings. We have no responsibility to update this report for events and circumstances occurring subsequent to the date of this report. This report is subject to the assumptions and limiting conditions outlined in Appendix A. BEARD MILLER COMPANY LLP );;JxI~ Mark S. Caltagirone, CPA, CV A Partner, Corporate Finance Group 7 East Mark!!l S(reel York, PA /7401-1285 Tel. 717-846-7000. Fax 717-843-/731 . Iv\vlv.beardmiller.colll TABLE OF CONTENTS Page I. Partnership Description and Assets of the Partnership 1 II. Economic Outlook 2 III. Regional Economic Overview 8 [ ] ] ] ] N. Valuation Methodology 10 V. Discounts 16 VI. Summary and Conclusion of Value 25 APPENDIX A. Assumptions and Limiting Conditions 26 B. Statement of Qualifications 27 C. Certifications 28 D. Sources ofInformation Relied Upon in this Valuation 29 E. Real Estate Appraisal Report Prepared by Clauser Real Estate Appraisals Sharretts Limited Partnership I. Partnership Description and Assets of the Partnership SLP is a Pennsylvania limited partoership that was formed on June 23, 1998, for the purpose of "pooling together the Partners' resources as co-owners in a form of business organization having the specific characteristics of this Partoership, so that they can be more effectively managed and invested as a business to the end of increasing the profit derived from, and the value of, such h I "I resources as a woe. The initial Partnership interests were as follows: Partoer Name Interest (%) Type I [ ] Sharretts Properties, Inc. 1.0 General Partner 1. Paul Sharretts 49.5 Limited Partner Patricia A. Sharretts 49.5 Limited Partoer 100.0 ] The assets of the Partnership consisted of the following at July 4,2001: 1 Excerpted from Limited Partnership Agreement of Sharretts Limited Partnership. 2 One-story industrial building on 3.157 acres ofland located in Manchester Township, Emigsville, PA: value is based on an appraisal performed by Clauser Real Estate Appraisals, as of July 2, 2001. Reference is made to this appraisal report and specifically to the "As is value" specified therein. The "As is value" was used in our report (rather than the "As Repaired with New Roof' value), based on management's representation that the new roof had not been put on the building as of the date of valuation. Beard Miller Company LLP 1 Sharretts Limited Partnership II. Economic Ontlook In order to properly perform the valuation of the Partnership, it was necessary to gain an understanding of the general economic conditions existing as of the valuation date. Although individual economic factors mayor may not have an impact on a particular industry or company, the overall economy (and the outlook for it) influences the investment perceptions of investors in all industries. Accordingly, we have conducted a review of the U.S. national economy. The purpose ofthe review is to provide a representative "consensus" review of the condition of the national economy and its general outlook at the end of the second quarter of2001. A. General Economic Overview I [ 1 , According to preliminary estimates released by the Department of Commerce's Bureau of Economic Analysis, Real Gross Domestic Product ("GDP"), the output of goods and services produced by labor and property located in the United States, increased at an annualized rate of 0.7% during the second quarter of2001. Annualized growth in GDP for the first quarter of2001 was revised to 1.3%, lower than the preliminary estimated rate of2.0%. Second quarter GDP reflected an increase in personal consumption expenditures, state and local government spending, and residential fixed investment. These gains were partly offset by decreases in equipment and software, exports, and in nonresidential structures. The Federal Reserve followed three rate reductions in the first quarter with three additional reductions during the second quarter. Target rates were left unchanged, during the last six months of 2000. The Fed is closely monitoring economic growth, financial markets, productivity measures, and labor data for signs of economic weakness or recovery. Many economists believe that the Fed's aggressive rate cutting over the last six months has contributed to slowing the economic deterioration. The modest June cut may signal an end to recent policy, as a renewal of economic growth could place the Fed in a more defensive posture regarding inflation. A clear pattern regarding future interest rate policy is difficult to discern. The Conference Board ("TCB") reported that the Composite Index of Leading Economic Indicators ("LEI"), the government's primary forecasting gauge, increased 0.3% in June to 109.6 after increases of 0.2% and 0.4%, respectively for April and May. The index attempts to gauge economic activity six to nine months in advance. Multiple consecutive moves in the same direction are said to be indicative of the general direction ofthe economy. In June, five ofthe ten leading economic indicators advanced. The positive contributors to the leading index were (largest to smallest) money supply, vendor performance, interest rate spread, average weekly initial claims for unemployment insurance, and index of consumer expectations. Negative contributors were stock prices, building permits, average weekly manufacturing hours, and manufacturers' new orders for non-defense capital goods. The June Conference Board press release characterized the U.S economy as "remaining fragile despite recent gains in the leading index." In June the Beard Miller Company LLP 2 Sharretts Limited Partnership Coincident Index fell 0.1 % and the Lagging Index declined 0.8%. TCB indicated, "the composite indexes and their components suggest that economic conditions have improved relative to the end of2000." Near-term economic growth expectations are mixed. The average annualized quarterly growth in GDP for the last four quarters has been 1.3%. The positive affects of2001 Fed policy and the fiscal stimulus of tax reform are not expected to significantly change GDP growth for the foreseeable months and perhaps not until early 2002. Given the lack of business investment, weak corporate profits and declining financial markets, it is surprising the economy has not dipped into recession. Based on continuing weak growth expectations, the current resiliency does not appear to translate into optimism. B. Consumer Spending and Inflation 1 I j According to the Bureau of Labor Statistics, the Consumer Price Index ("CPI") increased 0.2% to 178.0 in June (CPI - all urban consumers, 1982-1984 = 100, before seasonal adjustment). The seasonally adjusted annual rate of inflation for the second quarter of 2001 was 3.7%, compared to 2.8%, 2.1%, and 4.0%, respectively, for the third quarter (2000) through the second quarter of 2001. During calendar 2000, the CPI-U rose 3.4%, the largest annual advance since a 6.1 % rise in 1990. The energy index continued to decelerate in the second quarter of 2001, but was still significantly higher than the overall inflation rate with a 16.8% seasonally adjusted annualized increase during the second quarter. Medical care services, airfares and shelter costs have contributed to accelerating inflation in 2001. The core rate of inflation, absent food and energy, rose at a 2.6% SAAR during the second quarter. So far during 2001, the core rate of inflation has advanced 3.1% versus a 2.6% rate for 2000. The Producer Price Index ("PPI"), which is generally recognized as predictive of near-term consumer inflation, declined 0.4% in June (PPI for finished goods, seasonally adjusted) following an increase of 0.3% in April and 0.1 % in May. After adjustment for seasonal considerations, the core PPI (excluding food and energy) rose 1.9% during the second quarter and has risen 1.6% so far in 2001. Core PPI rose at a 1.3% seasonally adjusted rate during 2000. According to the Census Bureau of the Commerce Department, the percent change in retail sales for April to May 2001 was revised from +0.1% to +0.4%. The advance estimate for June retail sales (adjusted for seasonal, holiday and trading-day differences) reflected an increase of 0.2% from May 2001. The June sales figure was 4.0% higher than June 2000. Total sales for the April to June period were also up 4.0% from the same period a year ago. Personal consumption spending represents approximately two-thirds of total economic activity and is a primary component of overall economic growth. Real personal consumption spending increased 2.1% in the second quarter of 2001 and 3.0% in the first quarter of 2001. The second quarter figures were the slowest in several years. Durable goods purchase increased 6.0% in the second quarter of 2001 after a Beard Miller Company LLP 3 Sharretts Limited Partnership 10.6% increase during the first quarter. The economic slowdown has been largely a product of curtailed business investment. However, despite the staying power of consumers and their positive contribution to the LEI (via higher consumer expectations), consumers are not expected to return to the free spending habits of the last several years. C. Business and Manufacturing Productivity Throughout the current economic expansion, productivity has been a primary feature of improved living standards and an important element in relatively low inflation. The seasonally adjusted annual rate of non-farm business productivity as measured by the hourly output of all persons increased 2.5% in the second quarter. Productivity advanced 2.8% (all figures seasonally adjusted and annualized) for the entire business sector. Non-farm productivity growth was the result of a drop in hours worked (the largest drop since the first quarter of 1991) while output edged slightly higher. Manufacturing productivity, generally more volatile in its quarterly measures, fell 0.2% as output declined 5.8% and hours declined 5.6%. First quarter productivity represented a 3.6% decrease. These are the first declines in manufacturing productivity since the first and second quarters of 1993. D. Manufacturing and Industrial Production Industrial production fell 0.7% in June following a revised 0.5% decline in May. June marked the ninth consecutive monthly decline since September of 2000. Second quarter production was down 5.6% (annual rate) and is down more than 3.5% from June of2000. Manufacturing figures dropped 7.9% in the first quarter. Manufacturing output, which also posted its ninth consecutive monthly decline, contracted 0.8% in June, to more than 4% below prior year levels. Manufacturing production in April and in May declined 0.5%. Capacity utilization declined to 77% in June. So far in 2001, capacity utilization has remained below the 82% levels reported during much of 2000 as well the 82.1% average level for the 1967-2000 timeframe. Utilization is at its lowest level since August of 1983. While productivity measures have declined, the reduction in utilization provides some mitigating force to inflation. Manufacturing industries are expected to continue their weak performance until stronger economic growth and Fed rate incentives encourage higher output and investment. E. The Financial Markets The Dow closed the second quarter at 10502.40, up 6.3% for the quarter but still down 2.6% for the year. The Dow declined 6.2% in 2000. The S&P 500 index increased 5.5% during the quarter to close at 1224.38 after a decrease of 10.1 % for the year 2000. The S&P 500 remain in negative territory down 7.3% for the year. The NASDAQ Composite Index climbed 17.4% during the second quarter to close at 2160.54. The NASDAQ Composite Index was down 25.5% for the Beard Miller Company LLP 4 Sharretts Limited Partnership first quarter and is down 12.5% for the year. The NASDAQ lost 39.3% of its value in 2000. The broad market Wilshire 5000 index closed at 11407.15, up 7.2% for the quarter. The Wilshire 5000 index reflected a loss of 11.8% in 2000 and is currently down 6.3% for 2001. Stocks started the quarter with favorable gains in April with large cap and broad indices up 8% to 9%. The NASDAQ was up 15% in April. Despite continuing favorable Fed Policy the stock markets generally weakened in May and June. Worries regarding earnings and profits continue to hinder the performance of many issues. Consensus outlooks for the stock markets are for continuing weakness. A significant recovery in earnings is not expected until late in 2001 or beyond and many fear that the Fed's recent aggressive policy will moderate causing a delay of recovery in many business sectors. " , The monthly average yie1ds-to-maturity on the 30-year Treasury bond during the second quarter of 2001 were 5.65%, 5.78%, and 5.67%, respectively, for April, May, and June. Bond prices are negatively correlated with their respective yields, which can shift abruptly due to investor reactions to major variances in reported economic data versus market expectations (i.e., expected inflation, growth, monetary policy and other Fed action, etc.). Short-term yields were down early in the quarter while long-term yields increased. In June yields were down across the board as the Fed's mid-May easing matured in the market place and a late June easing helped keep bond prices up. " F. Interest Rates The Federal Reserve's Open Markets Committee ("FOMC") lowered its tar~et for the federal funds rate by 50 basis points on April 18th and again on May 15'. On June 27th the FOMC cut another 25 basis points with a target rate of 3.25%. These cuts follow aggressive action during the first quarter, which included a March 20'h cut of 50 basis points. Many believe the FOMC has another modest cut in mind but expectations for a continuation of recent policy are speculative. The following was taken from the Fed's June 27th statement: "The patterns evident in recent months--declining profitability and business capital spending, weak expansion of consumption, and slowing growth abroad--continue to weigh on the economy. The associated easing of pressures on labor and product markets is expected to keep inflation contained. Although continuing favorable trends bolster long-term prospects for productivity growth and the economy, the Committee continues to believe that against the background of its long-run goals of price stability and sustainable economic growth and of the information currently Beard Miller Company LLP 5 Sharretts Limited Partnership available, the risks are weighted mainly toward conditions that may generate economic weakness in the foreseeable future." G. Housing Starts and Building Permits Home building is generally representative of overall economic activity because new home construction stimulates a broad range of industrial, commercial, and consumer spending and investment. According to the U.S. Commerce Department's Bureau of the Census, new privately owned housing starts were at a seasonally adjusted annualized rate of 1.658 million units in June, 3% above the revised May estimate of 1.610 million units, and 6% above the June 2000 pace. Single-family housing starts in June were 1.304 million, 1.0% above the May level of 1.286 million units. An estimated 1.569 million privately owned housing units were started in 2000, 4% below the 1999 figure of 1.641 million. The seasonally adjusted annual rate of housing units authorized by building permits (considered the best indicator of future housing starts) was 1.568 million units in June, 3.0% below the revised May rate of 1.621 and approximately the same as measures from a year ago. Overall housing activity has remained relatively strong and favorable mortgage rates are expected to mitigate slow growth in other economic sectors. H. Unemployment According to the Labor Department's Bureau of Labor Statistics, unemployment levels during the second quarter of 2001 remained historically low. After rising slightly to 4.5% in April, the unemployment rate fell to 4.4% in April and then rose to 4.5% in June. June marked the forty-eighth consecutive month that the unemployment rate was below 5%. The unemployment rate for all of 2000 was approximately 4.0%, down slightly from 4.2% in 1999. Productivity during the year 2000 advanced 3.1% in the business sector and 3.0% in the non-farm business sector. These measures represent the largest increases since 1992. However, productivity measures so far in 2001 are the worst since the 1991 recession timeframe. Productivity measures provide a counterbalance to tight labor markets and inflation because demands for increased worker pay are more easily met when output rises. Layoff announcements, particularly in the manufacturing sector, will likely continue to contribute to rising unemployment for the balance of the year. I. Forecasts The forecasters surveyed by the Federal Reserve Bank of Philadelphia for the semi-annual Livingston Survev see the economy performing significantly worse in 2001 than they thought just six months ago. The economy's output is expected to grow just 1.9 percent in 2001, then strengthen in 2002 to 3.2 percent. Both figures are lower than in the previous survey, taken in December 2000. The first half of 2001 is the weakest, with the economy growing just 1.3 percent (at an Beard Miller Company LLP 6 Sharretts Limited Partnership annual rate); growth is then expected to rise to 2.7 percent in the second half. In the forecasts, the unemployment rate is expected to rise in both years, averaging 4.6 percent in 2001 and 4.8 percent in 2002. Those figures are both 0.3 percentage points higher than in the December 2000 survey. The forecasters now see prices increasing at a faster pace than in the previous survey. Consumer price inflation is expected to average 3.3 percent in 2001 (up from 2.8 percent in the previous survey), then decline to 2.6 percent in 2002 (up from 2.5 percent previously). Producer prices are also predicted to be higher than before. The only good news is that the forecasters think inflation will decline in 2002 for both consumer and producer prices. In the December 2000 survey, the forecasters thought that the interest rate on three-month Treasury bills would decline over the coming years. But they didn't see how rapidly or how much interest rates would fall. They now expect the T- bill interest rate to end 2001 at 3.5 percent, then rise a bit, ending 2002 at 3.9 percent. Note that these forecasts are significantly lower than in the previous survey. , Long-term interest rates are expected to creep up just a bit toward the end of 2002. The interest rate on the 30-year Treasury bonds is now projected to remain fairly steady over the next 12 months, rising a bit later this year to reach 5.8 percent by year-end. It is expected to fall slightly to 5.7 percent by June 2002, then rise to 5.9 percent by the end of the year. These forecasts for long-term interest rates are just slightly higher than in the previous survey. " , , The forecasters now think that the economy will grow just 3.2 percent annually over the next 10 years, compared to 3.4 percent in the previous survey. Inflation (in the Consumer Price Index) will average 2.6 percent over the next 10 years, unchanged from the previous survey. The forecasters now foresee a decline in the after-tax corporate profits and stock prices in 2001, however both are expected to rebound significantly in 2002. For 2001, after-tax corporate profits are expected to be 4.0 percent lower than they were in 2000, however, the growth rate of profits is expected to turn positive in the second half of2001, then rise 7.0 percent in 2002. Stock prices (as measured by they S&P 500 index) ended 2000 at a level of 1320. They are expected to drop to 1289 by the end of June 2001, then rise to 1315 by the end of December, a decline ofOA percent for the year. Stock prices, however, are expected to grow in 2002, rising to 1395 by the end of June and finishing the year at 1455, an increase of 11 percent from the year before. Beard Miller Company LLP 7 Sharretts Limited Partnership III. Regional Economic Overview When valuing a business, it is also important to review the overall economy of the region in which the company operates. We have again utilized numerous articles in the financial press, information posted on various Internet sites and The Beige Book, as published by The Federal Reserve Board for the Third District - Philadelphia The region's manufacturing firms' report continued weakness in business conditions, according to June's Business Out/oak Survey, which is conducted by the Federal Reserve Bank of Philadelphia. Survey participants report declines in new orders and employment again in June and no growth in shipments. Although there appear to be no overall increases in prices of survey respondents' finished goods, the percentage of firms reporting higher input prices increased in June. Firms' forecasts have improved significantly in recent months, suggesting that business will recover from current depressed levels over the next six months. The diffusion index of current activity remained negative in June, although it improved from -8.8 in May to -3.7. The percentage of firms reporting decreases in business activity (31 percent) exceeded the percentage reporting increases (28 percent) for the seventh consecutive month. The decline in the current activity index was accompanied by declines in other indicators of monthly economic performance. The current new orders index declined from -4.8 in May to -9.3; more than 35 percent of firms reported declines in new orders, and 26 percent reported increases. The shipments index also fell to a slightly negative reading, declining from 3.7 in May to -0.8 in June. Delivery times continued to shorten and unfilled orders decreased. Inventories fell: the percentage of firms reporting declines (37 percent) exceeded the percentage reporting increases (18 percent). The survey's labor market indicators reflect continued weakness in the manufacturing sector. The current employment index, which has now remained negative for eight consecutive months, fell from -II.! in May to -14.3 in June. Firms also report declines in average work hours: the current average workweek index fell from -14.6 to -16.8. The current prices paid index showed a notable rise, increasing from 1.5 in May (a 27- month low) to 17.8 in June. This marks the highest reading since last November. Still, nearly 62 percent of firms reported no change in prices of inputs this month. And although respondents indicated upward pressure on input prices, they reported that prices of final manufactured goods were experiencing no upward pressure. The percentage of firms reporting price declines (15 percent) exceeded the percentage reporting increases (II percent) for the eighth consecutive month. The current prices received index fell from -2.2 in May to -4.0 in June. Despite weakness in current activity, the outlook for manufacturing conditions over the next six months continues to improve. The index of future general activity increased from 33.1 in May to 58.2 in June. Sixty-three percent of the firms surveyed expect increases in overall business over the next six months, and only 5 percent expect decreases. Indicators for both future new orders and shipments improved notably this month: the future new Beard Miller Company LLP 8 Sharretts Limited Partnership orders index increased from 41.1 in May to 55.8, and the future shipment index increased from 28.8 to 47.6. Firms are less optimistic about employment than they are about business growth in general. While over 63 percent expect growth in overall business and new orders, only 29 percent of the firms anticipate growth in employment over the next six months. The future employment index increased slightly, from 9.6 in May to 12.6 in June. One dim forecast concerns capital expenditures. The percentage of firms expecting growth in capital expenditures over the next six months is equal to the percentage expecting decreases (17 percent). Moreover, the future capital expenditures index fell from 8.4 in May to 0.1 in June and has remained at relatively low levels since January. Most indicators of current economic performance suggest continued decline in the region's manufacturing sector this month. Survey participants continue to report decreases in the levels of general activity, new orders, employment, and average work hours. Although prices of final manufactured goods show no upward pressure, a higher percentage of firms reported increased input prices this month. With the exception of planned capital spending, the survey's future indicators displayed optimism, suggesting that manufacturing activity may show improvement by the end of this year. Common strengths among states included in the Mid-Atlantic region are that they have high per-capita income resulting in strong retail markets, centralized locations with strong and improving infrastructure, and an economically diverse workforce. Overall weaknesses of the region include high cost of doing business (taxes, energy, and regulatory compliance), a decreasing labor force/population, and a shortage of highly skilled employees. One of the results of these weaknesses has been the region's loss of some of its manufacturers to the South, where overall costs of business are significantly lower. Governments in the Mid-Atlantic States have been working toward improving these conditions by changing tax codes for business, promoting energy supplier choice to lower cost, and offering other benefits to attract and retain businesses. Beard Miller Company LLP 9 Sharretts Limited Partnership IV. Valuation Methodology A. Introduction The value of a business enterprise may be determined by using different approaches (e.g., market, income, or asset approach). Our valuation considers the following elements described in Internal Revenue Ruling 59-60 1959-1 (CB 237), which generally outline the approach, methods, and factors to be considered in valuing closely-held business equity interests for gift and estate tax purposes: 1. The nature of the business and the history of the enterprise from its inception. 2. The economic outlook in general and the condition and outlook of the specific industry in particular. 3. The book value of the stock and financial condition ofthe business. 4. The earning capacity of the company. 5. The dividend paying capacity ofthe company. 6. Whether or not the enterprise has goodwill or other intangible value. 7. Sales of the stock and the size of the block of stock to be valued. 8. The market price of stocks of corporations engaged in the same or similar line of business having their stocks actively traded in a free and open market either on an exchange or over the counter. Since determining the fair market value of a business is the issue, one must fully understand the circumstances of each individual case. There is no set formula to the approach to be used that will be applicable to the different valuation issues that arise. Often, an appraiser will find wide differences of opinion as to the fair market value of a particular business. In order to resolve such differences, one must recognize that the valuation is not an exact science. Revenue Ruling 59-60 states that "a sound valuation will be based on all relevant facts, but the elements of common sense, informed judgement and reasonableness must enter into the process of weighing those facts and determining their aggregate significance." We have considered and tested various valuation methods as outlined below. B. Market Approach 1. Guideline Company Method As part of the process of developing a value for the Partnership, we considered using the guideline company method. The guideline company method compares the subject company with companies traded on active, Beard Miller Company LLP 10 Sharretts Limited Partnership public markets in the sarne or a similar industry. This is accomplished by applying comparative market-derived multiples of value, such as a price to earnings ratio, price to revenue ratio, and price to book ratio, to the respective earnings, revenue and book value of the subject company as well as various cash flow driven multiples. In order to appropriately utilize a public company multiple, we believe that it is necessary to use publicly-traded companies that bear some resemblance to the subject company in terms of size and operating style and characteristics. Among the ways in which public companies differ from private companies are the following: . Size · Management depth/management succession · Product line diversification · Geographic diversification · Market position/market share . Supplier or customer dependence . Access to capital markets · Private companies are managed to minimize taxes, not to maximize income · Public companies typically are more growth oriented, particularly through acquisitions · Short-term expectations of public companies are different from the long-term outlook of private companies · Importance of patents and/or brands In recognition that few, if any, publicly-traded companies will ever be truly comparable to most closely-held businesses, the term "guideline" companies has evolved for companies that are similar to the subject company in a number of respects. Valuation multiples derived from publicly traded companies can be important determinants of value because they reflect the expectations of market participants. These multiples provide a reading of the market's psychology and its consensus as to the relative worth of a security. If guideline publicly-traded companies can be found, meaningful valuation multiples for a subject company can be determined by comparing the company with others in the sarne industry and, from its relative standing in the industry, inferring subject company market valuation ratios based on industry valuation ratios. Before such meaningful valuation multiples can be inferred, we must first ask an initial question: Does the subject company have the attributes necessary to make a comparison to public companies relevant? Robert Slee, in his article "Is the Subject Company Similar?", Valuation Strategies, May/June 1998, analyzed this question in detail. The Beard Miller Company LLP II Sharretts Limited Partnership substance of his argument is that guideline multiples can be applied to privately-held business only if the modem finance theory commonly applied to the financing and valuation of public companies can be extended to closely-held companies. He states: Finance theory was clearly developed for a theoretical firm that: · Has value established by a market (i.e., is publicly owned) . Has access to public debt and equity markets . Has owners with limited liabilities . Has owners who are well diversified . Has professional management . Has an infinite life . Has highly liquid securities traded in "efficient markets" . Has value maximization as the goal of all investment, financing, and dividend decisions Thus, finance theory did not have the closely held business in mind, and the theoretical valuation or other models must be applied (to the Subject Company) with caution. Slee also counters that the ability to go public lessens the effect of public and private market differences: "The bottom line is that if all a could-be- public company lacks from being public is the actual underwriting of the event, there is at least a basis for comparison to its publicly-traded counterparts." In addition to meeting minimum listing requirements then, Slee provides the following characteristics that can be used to determine whether a closely-held company could go public within a reasonable time period, thus at least indicating a foundation for comparison of the subject company with public companies. a. Does the subject have the look and feel of public companies in its market segment? Does it have a story for use of funds that would yield returns greater than expected in its market segment? b. Is their credential management depth? An active board of directors? Are both groups up to facing the public scrutiny as the process entails? c. Has strategic planning been developed to implement both short- term and long-term goals? d. Can all public reporting requirements, especially in the financial area, be met with timeliness? e. Does the Subject Company perform financially above the average in its market segment? Beard Miller Company LLP 12 Sharretts Limited Partnership f. Can the stock be sold even if all of the above are present? Is the subject company in a market segment that has historically been given access to public money? Although there are publicly traded companies that own real estate, it is our opinion that the difference between SLP and these companies is too great for any valid comparisons to be made. Therefore, we have not utilized the guideline company method in our determination of value for SLP. C. Income Approach A basic premise of business valuation theory is that the value of an ownership interest in a company is equal to the present worth of the future benefits of ownership. Although this premise is relatively simple to understand on its face, it is somewhat more challenging to apply due to the fact that the level of risks associated with the future benefits of owning a business are not always easy to identify and quantify. There are two primary income approaches as follows: 1. Capitalized Historical Returns This approach tends to be appropriate in situations in which it appears that a company's current or historical performance is indicative of its future performance. In the case of SLP, the income generated by the assets is not representative of their value. A value derived from capitalizing the earnings of the Partnership would likely be significantly less than the value of the property estimated by other methods. As such, we do not believe that it is appropriate to use this method to determine the value of SLP. 2. Discounted Future Returns This method is most typically used when future returns can be reasonably estimated and that there is a reasonable likelihood that future operation will continue at a predictable rate. This method is not used extensively to value small businesses because of the speculative and unreliable nature of any available financial forecasts. As a result of this fact and because the Partnership does not prepare multiple year forecasts or cash flows of future operations, we did not use this method. D. Underlying Asset Approach This approach is based upon the premise that the benefits of ownership would be realized through the hypothetical sale of the business' assets as part of a going concern as opposed to its earnings potential. Within the Underlying Asset Approach, there are two methods that must be considered as follows: Beard Miller Company LLP 13 Sharretts Limited Partnership 1. The Liquidation Value (LV) Method is applied when the business is in liquidation or its current and/or projected net cash flows do not suggest that the business can continue as a going concern. Inasmuch as this is not the case with SLP, we will not use this method. 2. The Net Assets Value (NA V) Method presumes that the business' value will be realized by a hypothetical sale of its assets as part of a going concern. It is often used to value real estate holding companies and investment companies whose primary assets are marketable securities. The criteria to apply the NA V method are as follows: · The subject entity holds significant tangible assets. (Virtually all of SLP 's assets are tangible.) · There is little or no value added to the business' products or services from labor. Labor-intensive businesses generally are not suited to this method. (There is no value added by labor.) · The balance sheet reflects all of the business' tangible assets; that is, the business has not expensed any tangible assets that continue to benefit the business. (SLP's balance sheet reflects substantially all tangible assets.) · The business has no significant intangible assets. (SLP has no intangible assets.) Inasmuch as SLP meets these criteria, we will utilize this method. In order to apply the NA V method, it is first necessary to state the Partnership's assets and liabilities at their fair market value at the valuation date. Value Percentage Cash $ 58,142 1,255,000 4.4% Real Estate 95.6% $ 1,313,142 100.0% Beard Miller Company LLP 14 Sharretts Limited Partnershio Inasmuch as we are estimating the value of a specific limited partnership interest (49.5% of the total), the next step is to multiply the total fair market value by 49.5% as follows: Cash Real Estate Total Fair market value of a 100% ownership interest (prior to the application of discounts) $58,142 $1,255,000 $1,313,142 X 49.5% X 49.5% X 49.5% Fair market value of a 49.5% interest (prior to the application of discounts) $28,780 $621,225 $650,005 , An important factor that influences the value of limited partnership interests is the lack of marketability and lack of control faced by each of the limited partners. In order to determine the extent to which the lack of marketability and the lack of control affect the interests, we reviewed the Partnership Agreement. Our findings are as follows: Factor Sharretts Limited Partnership Life of Entity December 31, 2050 Nature of Management Rights Limited Partners have no management rights Restrictions on Transferring Interests Transfers may be made by the Limited Partners only to spouses and certain descendants. Otherwise transfers must be approved in writing by the General Partner, at the absolute discretion of the General Partner. Existence of Voting Rights Voting rights are held only by the General Partner. As a result of these factors, we believe that it is necessary to apply a discount for lack of control and lack of marketability to the total shares of the Partnership. The quantification ofthese discounts will be discussed in Section V. Beard Miller Company LLP 15 Sharretts Limited Partnership V. Discounts Our assignment is to value a non-marketable, minority limited partnership interest in SLP. Accordingly, it is necessary to apply a discount for lack of control and lack of marketability as discussed below: A. Discount for Lack of Control (Minority Interest Discount) The Business Valuation Committee of the American Society of Appraisers (ASA) defines the term minority discount as "the reduction, from the pro rata share ofthe value of the entire business, to reflect the absence of the power of control." An important variable affecting the size of the minority interest discount to be applied in a particular case is the degree of control inherent in the interest being valued. For example, if one stockholder owns 80% of the stock of a company and another person owns 20%, the owner of the 20% interest has virtually no control over the operations of the business. However, if two stockholders each own 45% of a company's stock, and a third person owns the remaining 10%, by voting with one of the two 45% stockholders, the 10% owner has the power of a swing vote, which effectively gives the 10% stockholder some higher degree of control than the 20% owner has in the first example. Some of the prerogatives of control that provide value to the ownership of a controlling interest versus a minority interest are the power to: . Elect directors and appoint management . Determine management compensation and perquisites . Set corporate policy . Declare and pay dividends . Purchase or liquidate assets . Recapitalize, sell, or liquidate the company Very little information is available on sales of minority interests in closely held businesses. However, data is available from transactions involving the stock of publicly traded companies that can be used for guidance in quantifying a minority interest discount. The Business Valuation Committee of the ASA defines the term control premium as "the additional value inherent in the control interest, as contrasted to a minority interest, that reflects the power of control." Based on this definition, a minority interest discount is, therefore, the opposite of the control premium. Beard Miller Company LLP 16 Sharretts Limited Partnership 1. Empirical Studies Various studies have been published documenting the control premiums paid in transactions involving the purchase of a controlling interest in publicly traded companies: a. W.T. Grimm & Company , W.T. Grinun & Company tracks purchases of controlling interests in publicly traded companies and publishes data on the control premiums in their annual Mergerstat Review. In almost all cases where a controlling interest in a public company was purchased, a premium was paid in excess of the market price at which the stock had previously been trading as a minority interest. The statistics gathered and published by W.T. Grinun & Company indicate that average control premiums for these transactions imply a corresponding range of minority interest discounts of 26% to 33.3%. b. Houlihan, Lokey, Howard & Zukin Houlihan, Lokey, Howard & Zukin, Inc. publishes the quarterly HLHZ Control Premiums Study that present the results of their comparison of prices of larger public companies' stock prior to the controlling interest purchase transaction date, to the actual price paid for the controlling interest. Their studies indicate an average control premium of approximately 41 % to 48%, which implies an average minority interest discount of approximately 29% to 33%. 2. Public Sales of Partnership Interests Sales of limited partnership interests in the secondary market are often used as a source of discount observations. According to the latest study by The Partnership Spectrum, speculators in the limited partnership secondary market are buying units of real estate limited partnerships at an average price-to-value asset value discount of 28%. It is our belief that these studies give valid insight into the appropriate discount to be used for SLP. The study represents a sample group of 75 partnerships owning real estate assets ranging from office buildings to restaurants to insured mortgages. Partnerships announcing definitive, near-term liquidation plans were excluded from the study since price-to-value discounts typically shrink once a partnership announces near-term liquidation plans, and SLP has no plans for liquidation. All partnerships included in the study are publicly registered with the Securities and Exchange Conunission. Units of the limited partnership are sold in a secondary market. This market is comprised of ten to twelve independent securities brokerage firms that act Beard Miller Company LLP 17 Shan-etts Limited Partnership primarily as intermediaries in matching up buyers and sellers of units in non-listed partnerships of all types. This group of firms is known as the Limited Partnership Secondary Market. The discounts contained in the study primarily reflect lack of control and other minority interest concerns, with some portion of the discount attributable to lack of marketability. The portion of the discount attributable to the marketability concern appears to have become a lesser portion of the overall discount over the years since the growth of the secondary market in limited partnership interests means that a buyer can be found for virtually any public-registered limited partnership. Prior studies by The Partnership Spectrum confirm this assessment in that the discounts have declined with established liquidity. The first study published in 1992 found that the average price-to-value discount was 44% and it has declined to 28% in the current study. In addition, as a number of the partnerships have liquidated over the last few years, trading volume has declined from approximately $ 225 million in 1996 to approximately $ 68 million in 2000. In contrast to the declining trading volume, overall price-to-value discounts fell from 30% in 1997 to 28% in the current study. As the number of limited partnerships has declined, the liquidity may be increasing as investors in this market are competing for fewer investment opportunities. The discounts in the study also reflect discounts based on the price purchasers paid in the market. The price-to-value discounts to sellers for commissions and other transaction costs, ranging from 5% to 10%, are not reflected in these discounts. The two most important factors considered by secondary market buyers in pricing units of real estate partnerships are (i) whether the partnership has the ability to pay operating distributions and (ii) the degree of debt financing utilized by the partnership. According to the study, this is evidenced by the fact that the units of debt-free partnerships paying high distribution yields change hands in the secondary market at the lowest price-to-value discounts, while the non-distributing partnerships owning undeveloped land or debt-laden income properties typically trade at the highest discounts. The data evidences a clear link between discounts and cash distribution yields, as buyers are willing to accept lower discounts in exchange for higher current distribution yields, and vice versa. The study divides the partnerships into three main groups: income producing equity, triple-net-lease and insured mortgages. The income producing equity group is further divided into three classifications: distributing with low or no debt, distributing with moderate to high debt, and non-distributing. Beard Miller Company LLP 18 Sharretts Limited Partnership The six categories and the average discount and distribution yield for each group of partnerships are provided in the following table: Number Of Average Average Partnership Category Partnerships Discount Yield Equity-distributing (low or no debt) 16 25% 9.5% Equity-distributing (moderate or high debt) 14 26% 6.1% Equity --non-distributing 9 42% 0% Undeveloped land 3 38% 0% Triple-net-Iease 26 24% 10.9% Insured Mortgages 7 28% 12.3% Source: Partnership Profiles, Inc., The Partnership Spectrum, May/June 2001. 3. Other Sources An article in Trusts & Estates cites empirical evidence of minority interest discounts for real estate limited partnerships, apparently influenced to some extent by less than optimum marketability: A comparison of net asset values and secondary market prices for 85 real estate-based partnerships reported that actual transactions occurred at an average discount of 44 percent from liquidation values. For 21 of the 85 partnerships, the trading discount was 60 percent or more. Partnerships not currently distributing cash to investors tended to have larger discounts. This survey focused on partnerships whose units were traded relatively more frequently and in better-organized markets. For other partnerships and related entities, the market imperfections would be larger and the discounts greate~ 3 Mark S. Thompson and Eric S. Spunt, "The Widespread Overvaluation of Fractional Ownership Positions," Trusts & Estates, June 1993, p.63, citing Partnership Profiles, Inc., "LP Secondary Market Discounts How Much?" The Perspective, May/June 1992, pp. 1-2. Beard Miller Company LLP 19 Sharretts Limited Partnership It is our opinion that The Partnership Spectrum provides persuasive, credible evidence regarding the need for and level of a discount for lack of control. We believe that the Real Estate asset owned by SLP most closely resembles the category of "Equity-distributing (low or no debt)" with a 25% discount. Inasmuch as this percentage includes a discount for lack of marketability, which we will consider subsequently, we will reduce this percentage by approximately 25% to derive a discount of 18.8%. B. Discount for Lack of Marketability Another important variable is the marketability or lack of marketability of the Partnership interest being valued. Marketability may be defined as the ability to convert the property to cash quickly, with minimum transaction and administrative costs in so doing, and with a higher degree of certainty of realizing the expected amount of net proceeds. Generally, an interest in a business is worth more if it is readily marketable or less if it is not so readily marketable. Closely held businesses do not enjoy the ready market of publicly traded companies, so stock in a closely-held company is usually worth less than stock in a comparable publicly-traded company. Empirical studies aimed at quantifying the discount for lack of marketability generally fall into two categories as follows: . Sales of restricted stock of publicly traded companies. . Sales of closely held company stock when compared to later initial public offerings of the same stock. The following sections describe the results of these studies: 1. Sales of Restricted Stock Studies a. Institutional Investor Study by the SEe In 1971, the Securities and Exchange Commission (SEC) published a study indicating the amount of discount at which restricted letter stock traded, compared to prices of identical but unrestricted stock, on the open market. 4 Letter stock is restricted from trading on the open market for a specifically defined period of time, after which the stock may be freely traded. The difference in price at which letter stock transactions occur and the price of identical, freely traded stock on the same date, provides evidence of the discount placed on the restricted 4 "Discounts Involved in Purchases of Common Stock," in U.S. 920d Congress, 1st Session, House, Institutional Investor Study Report of/he Securities and Exchange Commission (Washington, DC: U.S. Government Printing office, March 10, 1971,5:2444-2456, Document No. 92-64, Part 5). Beard Miller Company LLP 20 Sharretts Limited Partnership stock due to its temporary lack of marketability. The average discount for all of the stocks involved in the SEC study, which covered the period from 1966 to 1969, was 25.8%. This study also isolated data from companies trading over-the-counter (OTC), as opposed to open exchanges, which tend to be more similar to closely-held businesses. The average discount reported for OTC companies was 32.6%. b. Robert Trout Study In 1977, Robert Trout published a study of letter stocks purchased by mutual funds from 1968 to 1972.5 Trout's study involved 60 purchase transactions that resulted in an average discount of 33.45%. Further, he found that stock traded on a national exchange had a lesser discount than stock traded over-the-counter. C. Milton Gelman Study In 1972, Milton Gelman published the results of his study of 89 restricted securities transactions occurring between 1968 and 1970.6 Gelman's study resulted in an average discount of33%. He also found that 60% of the purchases were at discounts of30% or more. d. Robert Moroney Study Robert E. Moroney published an article in the March 1973 issue of Taxes that presented the results of his study of prices paid by 10 registered investment companies for restricted securities. Moroney examined 146 transactions that resulted in an average discount of 35.6% and a median discount of 33.0%. Also, discounts as high as 90% were reported. e. J. Michael Maher Study In the September 1976 issue of Taxes, J. Michael Maher published his study compared prices paid for restricted stocks with the market price of similar unrestricted stocks.8 Maher studied data for a five-year period from 1969 to 1973. His study resulted in an average discount for lack of marketability of35.43%. 5 Robert R. Trout, "Estimation of the Discount Associated With the Transfer of Restricted Securities," Taxes, June 1977, pp. 381.85. 6 Gelman, "An Economist-Financial Analyst's Approach," pp.353-54. 7 Robert E. Moroney, "Most Conrts Overvalue Closely Held Stocks," Taxes, March 1973, pp. 144-54. 8 J. Michael Maher, "Discount for Lack of Marketability for Closely-Held Business Interests," Taxes, September 1976, pp. 562-71. Beard Miller Company LLP 21 Sharretts Limited Partnership f. Standard Research Consultants Study In 1983, Standard Research Consultants (SRC) tested the applicability of the 1971 SEC study by examining 28 private placements of restricted common stock.9 The SRC study, which covered transactions from 1978 through 1982, identified discounts from 7% to 91%, with a median of 45%. g. William L. Silber Study William L. Silber performed a study of 69 private placements of common stock of publicly traded companies between 1981 and 1988, the results of which appeared in a 1991 article in "Financial Analysts Journal. ,,10 The study indicated that the average discount was 33.75%. h. Williamette Management Associates Study This organization researched 33 private placements of restricted stocks in the early 1980s. The finding was that these private placements were consummated at a discount of 31.2%. The fact that this discount is slightly lower than those suggested by the other studies can be attributed to the depressed public stock market during that period. 2. Sales of Closely Held Company Stock when compared to Later IPO's of the Same Stock a. Baird & Company Studies This regional investment-banking firm conducted six studies during the time period from 1981 through 1993. For the 173 transactions studied, the average discount between the IPO sale price and non-IPO sale price was 46%. This represents a 100 basis points higher discount over the discount suggested by the aforementioned restricted stock studies. This incremental 10 percentage points is understandable in light of the fact that these transactions occurred prior to the purchaser having knowledge that some type of market would exist for the stock, which contrasts to the situation of the restricted stock studies in which a market existed, but could not be accessed immediately. b. Willamette Management Associates Study 9 "Revenue Ruling 77-287 Revisited," SRC Quarterly Reports, spring 1983, pp. 1-3. 10 William L. Silber, "Discounts on Restricted Stock: The Impact of Illiquidity on Stock Prices," Financial Analysts Journal, July-August 1991, pp. 60-64. Beard Miller Company LLP 22 Sharretts Limited PartnershiD Willamette has conducted 12 studies on the prices of private stock transactions relative to those of later public offerings on the same stock. The studies basically concluded that the median discount on the private transactions ranged between 31.8% and 62.9%. 3. Other Matters Supporting the Need for a Discount for Lack of Marketability a. Internal Revenue Service Revenue Ruling 77-287 In RR 77-287, the IRS explicitly recognized the importance of the conclusions reached in restricted stock studies in estimating the amount of a lack of marketability discount. b. Court Decisions Regarding Lack of Marketability Discounts . Thomas A. Solberg reviewed 15 cases in which the discounts for lack of marketability for restricted shares ranged between 10% and 90% with a median of 38.9% and a mean of 37.4%. 11 Solberg concluded: "The valuation of restricted securities is not a numbers game, and each case must stand on its own facts as represented to the court. Legal precedent, in terms of discounts granted in cases previously decided, is not as important as the nature, quality and quantity of the evidence and the skill with that evidence is marshaled and presented. The cases indicate that the courts, if provided with the factual basis to do so, are willing to grant significant discounts for restricted securities to properly reflect the economic realities of the marketplace. " . Philip W. Moore of J. & W. Seligman Valuations Corporation performed a study of 14 cases of the U.S. Tax Court involving discounts for lack of marketability and concludes that the tendency is for discounts to have risen over the years. . Recent court cases involving restricted or closely-held shares and lack of marketability issues are as follows: Estate of Saul R. Gifford, 88 T.C. 38 (1987) - Court ruled that the shares should be discounted 33% to reflect lack of marketability and an additional 2% for blockage. " Thomas A. Solberg, "Valuing Restricted Securities: What Factors Do the Courts and the Service Look For", Journal of Taxation. Sept. 1979, pp 150-54. Beard Miller Company LLP 23 Sharretts Limited Partnership Virginia Z. Harwood v. Commissioner, 82 T.C. 239 (1984) - Court held for a 36% lack of marketability discount. Roy O. Martin Jr. and Barbara M. Martin v. Commissioner, 50 T.C.M. 68 (1985) - Court held for 70% discount for "marketability/minority considerations." Estate of Martha B. Watts, 87-2 U.S.T.C. paragraph 13726 (11th Cir. 1987); 51 T.C.M. 60 (1985) - Court held for a 35% lack of marketability discount. Estate of Joyce C. Hall, 92 T.C. No. 19 (1989) - Court held for a 36% discount for lack of marketability. c. Other Support . An article by David B.H. Chaffe III in the December 1993 , issue of Business Valuation Review discusses the fact that put options pricing serves as a meaningful indicator of the discount for lack of marketability. The range of put prices over varying time frames is between 28% and 49%. . Other important factors to be considered in the determination of the level of the discount for lack of marketability include the following: The history of distributions. The existence of a buyer or buyers of the stock. The size ofthe block of stock. The existence of a put option that enables the seller to sell the stock. The feasibility of either a public offering or outright sale of the Business. Restrictions on the transfer of stock that may be contained in a buy-sell agreement. The availability and reliability of quantitative and qualitative information about the business. The absolute size ofthe business. Taking into consideration all of the factors and studies described herein, we believe that a marketability discount of 20% is appropriate for a limIted partnership interest in SLP. Beard Miller Company LLP 24 Sharretts Limited Partnership VI. Summary and Conclusion of Value As discussed previously in this report, we have considered various valuation approaches and methods and have determined that the Net Asset Value Method is the most appropriate in the case ofSLP. As the amount determined by the Net Asset Value Method is a control, marketable value, we will need to apply the discounts discussed in the previous section to reach a minority, non-marketable value for limited partnership interest being valued, as follows: , Value of Real Estate (49.5% interest) prior to the application of discounts $ 621,225 Discount for lack of marketability - 20% (124,245) Control, non-marketable value of Real Estate 496,980 Discount for lack of control- 18.8% (93,432) Minority, non-marketable value of Real Estate 403,548 Cash attributable to 49.5% owner 28,780 12 Minority, non-marketable value of a 49.5% limited partnership interest $ 432,328 Rounded $ 432,000 In conclusion, we believe tbe fair market value of a 49.5% limited partnership interest in SLP on a minority, non-marketable basis as of July 4, 2001 is approximately: $ 432,000 4d~0,W This valuation is subject to the assumptions and limiting conditions presented herein. 12 For the purposes of cash, we have ignored any discounts which may be attributable to the minority interest being valued. Beard Miller Company LLP 25 Sharretts Limited Partnership APPENDIX A ASSUMPTIONS AND LIMITING CONDITIONS This valuation is subject to the following assumptions and limiting conditions: I. Information, estimates, and opinions contained in this report are obtained from sources considered to be reliable; however, we assume no liability for such sources. 2. The Partnership and its representatives warranted to us that the information they supplied was complete and accurate to the best of their knowledge, and that the financial statement information reflects the Partnership's results of operations and financial condition in accordance with generally accepted accounting principles, unless otherwise noted. Information supplied by management and its representatives has been accepted as correct without further verification, and we express no opinion on that information. 3. Possession of this report, or a copy thereof, does not carry with it the right of publication of all or part of it, nor may it be used by anyone but the client or their professional advisors for any purpose without the previous written consent of the client and Beard Miller Company LLP. 4. We are not required to give testimony in court, or be in attendance during any hearings or depositions, with reference to the Partnership being valued, unless previous arrangements have been made. 5. The opinions of value presented in this report apply to this valuation only and may not be used out of the context presented herein. This valuation is valid only for the purpose or purposes specified herein. 6. This valuation reflects facts and conditions existing as of the valuation date. Subsequent events have not been considered, and we have no obligation to update our report for any subsequent events and conditions. 7. We have assumed that there is full compliance with all applicable federal, state and local regulations and laws, including EPA, DER and OSHA requirements, unless otherwise specified in this report. Beard Miller Company LLP 26 Sharretts Limited Partnership APPENDIX B STATEMENT OF QUALIFICATIONS MARK S. CALTAGIRONE, CPA, CV A General A Certified Public Accountant with over 25 years of combined experience in public accounting and commercial banking, Mr. Caltagirone is a Director in the Corporate Finance Group of Beard Miller Company LLP. The American Institute of Certified Public Accountants has awarded him a Certificate of Educational Achievement in Business Valuation for having successfully completed 64 hours of Business Valuation Training. He is also a Certified Valuation Analyst, a designation granted by the National Association of Certified Valuation Analysts, as a result of the successful completion of educational requirements. Credentials and Education Certified Public Accountant Member - Pennsylvania Institute of Certified Public Accountants Member - American Institute of Certified Public Accountants Member - National Association of Certified Valuation Analysts Bachelor of Science - Accounting, Lehigh University, 1974 Master of Business Administration - Finance, Lehigh University, 1975 American Institute of Certified Public Accountants - Certificate of Educational Achievement in Business Valuations (64 Hours) National Association of Certified Valuation Analysts - Certified Valuation Analyst Designation (82 Hours) American Society of Appraisers - Level I, Introduction to Business Valuation (30 Hours)* American Society of Appraisers - Level II, Business Valuation Methodology (30 Hours)* American Society of Appraisers - Level III, Business Valuation Case Study (30 Hours)* American Society of Appraisers - Level lV, Advanced Topics (34 Hours)** American Society of Appraisers - Level VI, ESOP Valuation Course (16 Hours) 2000 National Uniform Standards of Professional Appraisal Practice (USPAP) Course (15 Hours)*** *Passed three hour examination. **Passed eight hour examination. ***Passed one hour examination. Beard Miller Company LLP 27 Sharretts Limited Partnershio APPENDIX C CERTIFICATIONS We certify that, to the best of our knowledge and belief: I. The statements of fact in this report are true and correct. 2. The reported analyses, opinions, and conclusions are limited only by the reported assumptions and limiting conditions, and are our personal, unbiased professional analyses, opinions, and conclusions. 3. Our analyses, opinions, and conclusions were developed, and this report was prepared in conformity with Uniform Standards of Professional Appraisal Practice, and the business valuation standards of the American Society of Appraisers and The National Association of Certified Valuation Analysts. 4. Our compensation is not contingent on any action or event resulting from the analyses, opinions, or conclusions in, or the use of, this report. 5. This report was prepared under the direction of Mark S. Caltagirone, CPA, CV A, a director of Beard Miller Company LLP. Neither Mr. Caltagirone nor the other directors of Beard Miller Company LLP have any present or contemplated future interest in Sharretts Limited Partnership, any personal interest with respect to the parties involved, or any other interest that might prevent us from performing an unbiased valuation. 6. Except as indicated below, no one has provided significant professional assistance to the person signing this report. Contributing Appraiser: Glenn R. Spinello, CPA, CV A, CMA Beard Miller Company LLP 28 Sharretts Limited Partnership APPENDIX D SOURCES OF INFORMATION RELIED UPON IN THIS VALUATION External Sources · Real estate appraisal report prepared by Clauser Real Estate Appraisals as of July 2, 2001. · Practitioners Publishing Company, Guide to Business Valuations - 11th Edition. · Partnership Profiles, Inc., The Partnership Spectrum, May/June 2001. · Waypoint bank statement as ofJuly 3,2001. · Sources for second quarter 2001 National Economic Review are attached on the following page. Internal Sources · Limited Partnership Agreement dated June 23,1998. · Partnership tax return (Form 1065) for the year ended December 31, 2000. Beard Miller Company LLP 29 Sharretts Limited Partnership Sources for Second Quarter 2001 National Economic Review The primary sources for both the text and economic indicator pages of The National Economic Review are the U.S. Department of Commerce, the U.S. Department of Labor's Bureau of Labor Statistics, the U.S. Census Bureau, and the Conference Board. Information from major economic indicator press releases and data from the STAT-USA Internet website account for the majority of the review's statistical content. Specific sources of data are cited in the "Economic Indicator and Investment Trends" exhibits of the review. Additionally, we review articles from the financial press and other media in order to gain additional perspective regarding economic activity. BARRON'S (The Dow Jones Business and Financial Weekly) May 7,2001 "Barron's Market Laboratory, Indexes' PIEs and Yields," p. MW74, and "Weekly Bond Statistics," p. MW76. June 4,2001 "Barron's Market Laboratory, Indexes' PIEs and Yields," p. MW74, and "Weekly Bond Statistics," p. MW76. July 2,2001 "Barron's Market Laboratory, Indexes' PIEs and Yields," p. MW58, and "Weekly Bond Statistics," p. MW60. THE WALL STREET JOURNAL The Wall Street Journal typically publishes a list of various economic indicator (as well as other governmental report and meeting) release dates in the first issue of every month (see Money and Investing, Section C, usually page 2 or 3). Virtually all released data is reported on the following day in the "Economy" column of Section A (page 2) of the paper. We recommend a review of these columns for additional perspective on any given release. Economic news stories and data as downloaded from tbe following databases and websites: . The Economic Bulletin Board . CompuServe Information Service . http://www.briefing.coml . http://stats.bls.gov/ (U.S. Department of Labor Bureau of Labor Statistics) . http://www.stat-usa.gov/ (Department of Commerce, requires subscription to access) . http://www.yahoo.comlheadlineslbusiness/ . http://www.cnnfu.coml(CNN financial network) . http://www.federalreserve.gov/ . http://www.usatoday.comlmoney/mfront.htm (USA Today) . Specific sources of data are cited in the financial indicator exhibits Beard Miller Company LLP 30 , . Connelly R.oed, Emipville APPENDIX E APPRAISAL REPORT FOR JOHN POWELL, VICE PRESIDENT CHARLES D. SNYDER & SON INC 10m AND WALNUT STREET POBOX 2243 HARRISBURG PA 17105-2343 , -~-!.. II _ ,." j" rt. ... - - ... , '.,." SHARRETTS PLATING COMPANY ONE-STORY INDUSTRIAL BUILDING LOCATED CONNELLY ROAD MANCHESTER TOWNSHIP EMIGSVILLEPA 17318 Prepared by George C. Clauser, SRA . 1-03I3C-2 CLAUSER REAL ESTATE APPRAISALS POBox 777 Camp Hill, PA 17001-0777 Telephone: 717-737-7300 FAX: 717-730-0922 #--n~ CUUSBIl@f'AOIVLlNE.COM July 2, 2001 John Powell, Vice President Charles D. Snyder & Son, Inc 10th and Walnut Street P O.Box 2343 HarrisburgPA 17105-2343 RE: Sharretts Plating Company One-Story Industrial Building Located: ConneIly Road Manchester Township, EmigsviIIe, P A 17318 Dear Mr. Powell: As requested, I have completed my inspection and subsequent market studies on the above referenced industrial building for the purpose of estimating its market value as repaired with a new roof as of July 2, 2001. Date of inspection was March 28, 2001. The property being valued is located on the west side of Connelly Road in the York County Industrial Park in Manchester Township, York County, PA. Improvements consist of a one-story detached masonry and metal industrial building containing 39,088 square feet on a site containing 3.157 acres. The property was tennant occupied on the date of inspection. The site is located in HUD identified flood hazard areas C and therefore does not require flood insurance. Appraised value assumes the property is cleared of hazardous materials with DER Phase I certification suggested. The appraised value is based on clear certification and compliance with Township Codes and Regulations. Based on my studies and subject to the limiting conditions found in and attached to this report, the property in my opinion has estimated market values as of July 2, 2001 of: "As Repaired with New Roof' ONE MILLION FIVE HUNDRED THOUSAND - ($1,500,000) - DOLLARS "As is Value" ONE MILLION TWO HUNDRED FIFTY-FIVE - ($1,255,000) - DOLLARS COMMERCIAL' INDUSTRIAL' APARTMENT COMPLEXES' SUBDIVISION ANALYSIS' RESIDENTIAL Conne/lyRoad.Emig,vilk 1-0313C_2 CLAUSER REAL ESTATE APPRAISALS Page 2 Details of my methods of valuation as well as a description ofthe improvements are contained in the ensuing Complete Appraisal Report in Summary Report Format. This report is believed to be consistent with recommended guidelines ofthe Appraisal Standards Board of the Appraisal Foundation. I have completed numerous appraisal of a similar nature in a similar type property and comply with the competency provisions of US PAP. This letter of transmittal is considered part of the appraisal which follows and is not to be detached. [ [ ] ] ] I ] ] ] Employment in and compensation for making this appraisal are in no manner contingent upon the ~alue reported, and I certify that I have no financial interest in the property appraised, present or contemplated, and that the appraisal assigmnent was not based on a requested minimum valuation, a specified valuation, or the approval of a loan. The appraiser has personally inspected the property. My assistant, Carl Anderson, has assisted in the preparation of this valuation. The Appraisal Institute conducts a voluntary program of continuing education for its designated members. SRAs who meet the minimum standards of this program are awarded periodic educational certification. I am currently certified under the SRA program. Very truly yo~, ~c,~ George C. Clauser, SRA P A State Certified General Real Estate Appraiser Certificate #GA-000233-L ~JJ.'~d;Q~ Assistant to the Appraiser CSA/ja Enclosures Appraiser's Certification Subject Photo's Summary ofImportant Facts and Conclusions Appraisal Addenda Connelly Road. Emipvillc I-03lJC-2 GEORGE C. CLAUSER, SRA P A State Certified General Appraiser Clauser Real Estate Appraisals PO Box 777 Camp Hili, PA 17001-ll777 Phone (717) 737-7300 Fax (717) 730-ll922 e-mail address:clauser@paonllne.com QUALIFICATION SHEET EDUCATION: I' I Lebanon Valley College, Annville, PA B.S. in Economics and Business Administration Appraisal Institute Standards of Professional Practice A Standards of Professional Practice B ] r American Institute of Real Estate Appraisers Real Estate Appraisal Principles 1 A-1 Basic Valuation Procedures 1 A-2 Capitalization Theory and Techniques 1A&B Narrative Report Writing All courses necessary to complete the SRA Designation All courses to complete Pennsylvania State General Certification PROFESSIONAL MEMBERSHIP/DESIGNATION: Pennsylvania State Certified General Real Estate Appraiser #GA-000233-L Pennsylvania Real Estate Broker (License RB-025061-L) Senior Residential Appraiser (SRA) with the Appraisal Institute and MAl Candidate REAL ESTATE EXPERIENCE: 1993-Present 1983-1993 1973-1983 1968-1973 George C. Clauser Real Estate Appraisals Associate Appraiser, Lester G. Connor, MAl, Camp Hill, PA Associate Appraiser, Joseph McGraw, Inc., Lemoyne, PA Sales Associate, Dougherty and Twigg Real Estate TESTIMONY: Cumberland, Dauphin and York County Courts Tax Assessment Appeals Civil Litigation Local Municipalities - Zoning Meetings TYPES OF APPRAISALS COMPLETED: Commercial - Stores, Motels, Restaurants, Offices, Automobile Dealerships, Kennels, Greenhouses, Shopping Centers, Apartment Complexes, Mobile Home Parks Condominiums - Offices, Residences Industrial - Warehouses, Truck Terminals, Service Stations, Manufacturing Facilities, Repair Garages Land - Farms, Subdivisions, Commercial, Industrial, Acreage, Easements-Utility, Conservation and Agricultural Preservation Easements. Residential - Single, Multi-family, Luxury Residences, Historic Properties Valuation of Partial Interests - Leasehold, Life Estates, Leased Fee Interests Other - Condemnation Appraisals, Estate Valuations, Divorce Proceedings, Tax Assessment Appeals and Valuations, Relocation Appraisals, Churches, Value Estimates for Damages from Infestation and Boundary Line Disputes APPRAISALS HAVE BEEN COMPLETED FOR: I Adams .County National Bank Allfirst Bank Commerce Bank Community Bank Dauphin National Bank Drovers Bank First Union Fulton Bank Legacy Bank Mellon Bank Mid Penn Bank National City Mortgage Orrstown Bank PA State Bank PNC Spring Grove National Bank Waypoint Bank I I EDUCATION STATEMENT "The Appraisal Institute conducts a voluntary program of continuing education for its designated members. MAls, SRPAs & SRAs who meet the minimum standards of this program are awarded periodic educational certificates." I, George C. Clauser, am currently certified under the SRA Program. .~~J~ \:<,". .x'. ;~t'. ':~\~'x~., . ., , ;::. ',~"';. >;(. ~'.~ \:. ,-' '<' ,. J... . ~' ,-,'1 . -, i, . ;~':'r\ j:~.' Certification Dalei ' \~ 'Pl . ".ISsued f':" :{; "'I'xpires, o . ~,)~; ",';;;<..;;.' ....J GA-000233'-L 07\f9.91 \ '" '" - "'>;~~:2L~,~,~~:#:~~;;;;;'/ ~;k' T " .~::" /\,':.~ JUNb7i9's'9 .Y ..' ,,~ '.'. .,:iW{" ) . "CetlifiC;/i~NriJnJier ~,. '-"-- " -'. . AUG '..;JiJN 30 2001 ] \~Lc..~V .sig",~~,..",.,\"".." /iIu.< ........ <,........ ...~u<-j;. >,._'~,~~~cr Qr.~.li:, . ,.' '_:-~_:S~~~~~.~:.,.44f~~,:.. '::":::_.:.:, . li..tid!:o: )! GBOR,(la <;:r:AIR~LAUSER 323 Pli:IEWOOPORIvE .. SHIRllMAN$fOW!:f./I'A 1701 1 I ::-.". "-. ,. , ;'.':" <)' ~VL .r., ;/ :'1 e ~~' , '. ~~-_. >; ; .::. ~bt. ,":' ,-' r. ,~/~;~~,~:}f~: ( ~'l ";/: CLAUSER REAL ESTATE APPRAISAL Connelly Road Front of Building _lilt!. II _ ,,' )1 "I - JoIO,!_ _ Rear of Building j I II ,-" I' ~"; ..=;\-1 -..-.,., .- .-.- .":".t. . .....~ >"'";'" " .<"k,7f~{~t"~~:~~~~~~:.R~;~~:; . . ...:~;:.,::::~;':t~Si;(~;;";;~~t~;~ ~ -:.::-.' .- '. CLAUSER REAL ESTATE APPRAISAL Connelly Road South Side of Building r I North Side of Building , CLAUSER REAL ESTATE APPRAISAL Storage Yard . 1 , , " " CLAUSER REAL EST ATE APPRAISAL r " Connelly Road Facing South , j, _:~~~'_-'-'-".o, ..~~.:.,.---- I I 1. l' , I l. r , L \. \ r \ . I \. \ , , "-'" " " j, Facing North ," 1 j, " l' " ';'- " " -" " CLAUSER REAL ESTATE APPRAISALS SUMMARY OF IMPORTANT FACTS AND CONCLUSIONS PROPERTY ADDRESS: OWNERS OF RECORD: PARCEL NO: ~MID AREA: LAND TO BUILDING RATIO: IMPROVEMENTS: ," HIGHEST AND BEST USE: VALUE ESTIMATES: , FINAL VALUE ESTIMATE: With New Roof Installed As Is DATE OF VALUATION: ConneIlyR.oad.Emipville Connelly Road, Manchester Township, Emigsville, York County, PA Sharretts Limited Partnership, A Pennsylvania Limited Partnership 36-000- LI -000 I J 3.157 acres 3.52:1 One-story masonry and steel industrial building containing gross building area of 39,088:1: SF. The interior is tenant occupied as office, plating plant, warehouse and storage area with the principal occupant, as of the date of appraisal, being Sharretts Plating Company. Present legally permitted conforming use as an industrial building. Cost Approach Income Approach Sales Comparison Approach With New RoofInstalled As Is $1,600,000 $1,360,000 $1,500,000 $1,255,000 $1,500,000 $1,255,000 July 2, 2001 1-o313C.2 CLAUSER REAL ESTATE APPRAISALS SUMMARY OF IMPORT ANT FACTS AND CONCLUSIONS PROPERTY ADDRESS: OWNERS OF RECORD: PARCEL NO: LAND AREA: LAND TO BUILDING RATIO: IMPROVEMENTS: HIGHEST AND BEST USE: VALUE ESTIMATES: FINAL VALUE ESTIMATE: DATE OF VALUATION: Connelly R.l:lad, Emipvillc Connelly Road, Manchester Township, Emigsville, York COWlty, PA Sharretts Limited Partnership, A Pennsylvania Limited Partnership 36-000-LI-000I J 3.157 acres 3.52:1 One-story masonry and steel industrial building containing gross building area of 39,088f SF. The interior is tenant occupied as office, plating plant, warehouse and storage area with the principal occupant, as of the date of appraisal, being Sharretts Plating Company. Present legally pennitted conforming use as an industrial building. Cost Approach Income Approach Sales Comparison Approach $1,600,000 $1,360,000 $1,500,000 $1,500,000 April 27, 2001 l-Ol13C-2 CLAUSER REAL ESTATE APPRAISALS TABLE OF CONTENTS r PURPOSE OF APPRAISAL .................................................................................................................1 PROPERTY RIGHTS APPRAISED .....................................................................................................1 MARKET VALUE DEFINED ..............................................................................................................1 IDENTIFICATION................................................................................................................................2 OWNERSHIP ........................................................................................................................................2 LEGAL DESCRIPTION .......................................................................................................................2 LEASES .......... ............ ......... ................... ............ ......... ...................... ............. ................ .......... .... ...... ...5 REAL ESTATE TAX AND ASSESSMENT ANALYSIS ...................................................................6 AREA ANALYSIS ................................:...............................................................................................7 NEIGHBORHOOD ANAL YSIS.........................................................................................................13 SITE ANALYSIS ... ......... ............... .................... ........................ ........................................ ............ .....14 IMPROVEMENTS ANALYSIS .........................................................................................................16 HIGHEST AND BEST USE ...............................................................................................................18 VALUATION ......................................................................................................................................23 VALUATION PROCESS AND SCOPE OF APPRAISAL................................................................23 COST APPROACH .............................................................................................................................24 INCOME CAPIT ALIZA TION APPROACH .....................................................................................34 SALES COMPARISON APPROACH................................................................................................40 RECONCILIATION ........... ............. ...................................................................................... ..............48 CERTIFICATION AND STATEMENT OF LIMITING CONDITIONS ..........................................50 ADDENDA Zoning Extract Marshall Valuation Extract , Connelly Road. Emigsvill~ I-OJ13C-2 CLAUSER REAL ESTATE APPRAISALS APPRAISAL OF SHARRETTS PLATING COMPANY ONE-STORY INDUSTRIAL BUILDING LOCATED CONNELLY ROAD EMIGSVILLE, PA 17402 PURPOSE OF APPRAISAL The purpose of this appraisal is to estimate the market value ofthe subject property as of April 27,2001. The function of this appraisal is its use in providing a market value estimate which is for the client's use in consideration of mortgage financing. PROPERTY RIGHTS APPRAISED For the purpose of this appraisal, the property rights appraised assume fee simple title which is a title that signifies ownership of all the rights in a parcel of real property subject to limitation of the four powers of government which are taxation, escheat, police power and eminent domain. The property is valued as though unencumbered as the property is tenant occupied on a month to month basis. MARKETVALUEDEBNED A widely accepted definition of market value accepted by the Federal National Mortgage Corporation and the Federal National Mortgage Association is used in this report and is defined as follows: "The most probable price in terms of money which a property should bring in a competitive and open market under all conditions requisite to a fair sale, the buyer and seller, each acting prudently, knowledgeably and assuming the price is not affected by undue stimulus." Implicit in this definition is the consummation of a sale as of a specified date and the passing of title from seller to buyer under conditions whereby: I. buyer and seller are typically motivated. Connelly Road. Emmigrvillc 1 1-0313C-2 CLAUSER REAL ESTATE APPRAISALS MARKET VALUE DEFINED - (Cont'd) 2. both parties are well informed or well advised, and each acting in what they consider their own best interest. 3. a reasonable time is allowed for exposure in the open market. 4. payment is made in cash or its equivalent. 5. financing is on terms generally available in the community at the specified date and typical for the property type in its locale. 6. the price represents a normal consideration for the property sold unaffected by special financing amounts and/or terms, services, fees, costs, or credits incurred in the transactions. 1DF-NTlFlCATION The subject property consists of a one-story steel and masonry and metal industrial type building and is known as Sharretts Plating Company and is located on Connelly Road, Manchester Township, EmigsviIle, York County, PA 17318. OWNERSHIP .' , Based on York County Tax Records, present ownership is under Sharretts Limited Partnership who acquired'the property in September, 1998 as recorded in Deed Book 1341, Page 2448. Prior ownership was under I. Paul Sharretts and Patricia A. Sharretts as recorded in Deed Book 1255, Page 1626, July 1986. LEGAL DESCRIPTION Per Deed Book 1341, Page 2448: "ALL THAT CERTAIN tract of land lying and situate in Manchester Township, York County, Pennsylvania, described according to a plan of survey made by Buchart-Hom, Consulting Engineers, dated May 3,1974, as follows to wit: BEING at an iron pin, said iron pin of beginning being located 500 feet North of the intersection of the legal right-of-way lines of Busser Drive and Connelly Road and also at the Northeast comer of lands now or formerly occupied by Progressive Typographers and on the West right-of-way line of Connelly Road (having a right-of-way width of 100 feet); thence from said point of beginning South 84 degrees, 25 minutes, 00 seconds West, a distance of 300 feet to an iron pin on line, said iron pin being the northwest comer of lands now or formerly occupied by Progressive Typographers; thence along same said line South Connelly Road. EmmiJllville 2 1-0313C-2 CLAUSER REAL ESTATE APPRAISALS LEGAL DESCRIPTION (Cont'd) 84 degrees, 25 minutes, 00 seconds West an additional 250 feet to an iron pin, said pin being the comer oflands now or formerly of York County Industrial Development Corporation; thence North 05 degrees, 35 minutes, 00 seconds West, a distance of250 feet to an iron pin; thence along lines now or formerly of York County Industrial Development Corporation, (being Lot No. 15); North 84 degrees, 25 minutes, 00 seconds East, a distance of550 feet to an iron pin, said iron pin being the West right-of-way line of existing Connelly Road; thence along said right-of-way line South 05 degrees, 35 minutes, 00 seconds East, a distance of250 feet to an iron pin on the Northeast comer ofland occupied by Progressive Typographers and the place of BEGINNING. CONTAINING 3.157 acres. BEING the same premises which York County Industrial Development Authority by their Deed dated July 11, 1996, and recorded in the York County Recorder of Deeds Office in Record Book 1255, Page 1626, granted and conveyed unto I. Paul Sharetts and Patricia A. Sharretts, Grantors herein. LEASES The property is currently leased by Sharretts Plating Co. Inc. on a month-to-month basis under the terms ofa five year lease that commenced May 17, 1994 and ended May 16, 1999. Lease rate is $73,200 per year payable in equal monthly installments of$6,100. Tenant is responsible for all taxes, utilities, repairs, maintenance, and insurance. Any alterations, improvements or additions made by the tenant at tenants expense shall become the property of the landlord. Connelly ROId, Emmipville 3 1-03/3C.2 CLAUSER REAL ESTATE APPRAISALS REAL ESTATE TAX AND ASSESSMENT ANALYSIS Tax Map Parcel Number 36-000-LI-000IJ Current Assessment: Land Improvements Total $ 140,210 844.520 $984,730 Real Estate Taxes for 2001 are as follows: MiIlal!e Assessment Taxes 2001 County 3.150 x $984,730 = $ 3,101.90 2001 Municipal 1.240 x $984,730 = 1,221.07 2000-01 School 11.250 x $984,730 = 11.078.21 Total 15.640 $15,401.18 Common Level Ratio The Common Level Ratio established by the State Tax Equalization Board for York County for 1999 is 94.0%. Market Value of the property by the Assessors Method for property tax purposes using the Common Level Ratio is as follows: Assessed Value $984,730 Common Level Ratio .94 = Estimated Market Value $1,047,585 Property does not appear to be over assessed. Connelly Roed, Envnigsville 4 1-0313C-Z CLAUSER REAL ESTATE APPRAISALS AREA ANALYSIS York County is located in the southern portion of Central Pennsylvania and is bordered on the south by the State of Maryland, on the east by Lancaster County, on the north by Dauphin and Cumberland Counties and on the west by Adams County. The county has a land area of 904.6 square miles and an estimated 1996 population of368,332 according to statistical data shown in the 1997 York County Data Book as prepared by the Pennsylvania State Data Center. York City, the county seat, is located near the center of the county and has been the focal point of much of the growth activity in the county. Other rapid growth areas include the southeast portion of the county along The Maryland State line and the northern part ofthe county adjacent to Cumberland County. The estimated York County population increase for the period 1990 to 1996 is 8.5% versus a state growth of only 1.5%. The projected population growth for York County from 1990 to 2020 is estimated to be 22.5% Much of the continuing growth of the area is attributable to its strategic Eastern United States location. Approximate distances from New York City to major metropolitan areas in the Middle Atlantic Market Region are listed below: Baltimore Harrisburg Lancaster Philadelphia Washington, D. C. New York City 50 Miles 25 Miles 25 Miles 90 Miles 90 Miles 175 Miles The York metropolitan area has over 600 manufacturing establishments which employ in excess of 45,000 persons with a payroll approaching 1.5 billion dollars. Major employers in the area include the Defense Distribution Center in Fairview Township; Harley-Davidson,lnc; York International, Inc.; AMP, Inc.; York Hospital and York County Government. The area is strongly influenced by the light metal industry and machinery production, as well as defense spending and production. As a result, the area economy is sensitive to recessionary pressures on the national economy which have occurred in previous years. Agriculture is also important to the York County Economy as the County ranks second in number of farms and seventh in total farm receipts. Tourism is also a valuable contributor to the County economy with York second only to Lancaster in the Central Pennsylvania area. Connelly Roed, Enunigsvil1e 5 1..o])]C-2 CLAUSER REAL ESTATE APPRAISALS AREA ANALYSIS - (Cont'd) PODulation The U. S. Census Bureau shows how Pennsylvania communities rank among the 276 U. S. metropolitan areas by percent of population change between April 1, 1990 and July 1,1998. The York and Lancaster areas were the fastest growing in the state. While ScrantonlWilkes-Barre was among the regions that lost the most population, HarrisburglLebanonlCarlisle grew from 587,986 in 1990 to 616,031 in 1998 for a change of+28,045 or 5% and was ranked 185 out 276. The following chart is included for the benefit of the reader. POPULATION CHANGES How Pennsylvania communities rank among the 276 U.S. metropolitan areas by percent of population change between April I, 1990 and July 1, 1998. The York and Lancaster areas were the fastest growing in the state. ScrantonfWilkes- Barre was among the regions that lost the most population. City Population 1998 Population 1990 Change Percent Rank York 373,255 339,574 33.681 10% 115 Lancaster 456,414 422,822 33.592 8% 151 State College 132,700 124,812 7,888 6% 170 Readittg 355.956 336,523 19,433 6% 176 Harrisburg/Lebanonl 616.031 587,986 28.045 S% 185 Carlisi: Al1entownIBethleheml 616,877 595,081 21,796 4% 201 Easton PhiladelphiaIWilmingtonl 5,988.348 5,893,019 95,329 2% 226 Atlantic City Sharon 121,938 121,003 935 1% 231 Erie 276,401 275,572 829 0% 238 Altoona 130,615 130,542 73 0% 240 Williamsport 117,308 118,710 (1,402) -1% 249 Pittsburgh 2.346,153 2,394,811 (48,658) -2% 253 Johnstown 236,347 241,280 (4,933) -2% 254 ScrantonlWilkes-Barrel 615.491 638.524 (23.033) -4% 265 Hazleton Source: u.s. Census Bureau A chart showing projected population for all of Pennsylvania Counties is included on the following page with counties in Central Pa in bold print. Connelly Road, Emm;pville 6 I-0313C-2 CLAUSER REAL ESTATE APPRAISALS AREA ANALYSIS - (Cont'd) Proiected PODulation for Pennsvlvania Counties Countv 1990 Pon. 2020 Pon. % Cham!e County 1990 POD. 2020 POD. % Cham!e Adams 78,274 103,475 32.2 Lancaster 422,822 597,975 41.4 Allegheny 1,336,449 1,130,284 -15.4 Lawrence 96,246 83,259 -13.5 Annstrong 73,478 61,003 -17 Lebanon 113,744 129,742 14.1 Beaver 186,093 160,838 -13.6 Lehigh 291,130 327,295 12.4 Bedford 47,919 54,402 13.5 Luzeme 328,149 317,870 -3.1 Berks 336,523 414,621 23.2 L ycoming 118,710 124,149 4.6 Blair 130,542 125,049 -4.2 McKean 47,131 47,141 0 Bradford 60,967 74,199 21.7 Mercer 121,003 124,609 3 Bucks 541,174 645,042 19.2 Mifflin 46,197 45,209 -2.1 Butler 152,013 177,837 . 17 Monroe 95,709 212,009 121.5 Cambria 163,029 132,266 -18.9 Montgomery 678,111 711,734 4.9 Cameron 5,913 5,333 -9.8 Montour 17,735 20,555 15.9 Carbon 56,846 64,599 13.6 Northampton 247,105 303,586 22.9 Centre 123,786 151,010 22 Northumberland 96,771 92,835 -4.1 Chester 376,396 510,219 35.6 Perry 41,172 55,784 35.5 Clarion 41,699 40,781 -2.2 Philadelphia 1,585,577 1,451,337 -8.5 Clearfield 78,097 70,760 -9.4 Pike 27,966 79,170 183.1 Clinton 37,182 39,839 7.1 Potter 16,717 14,852 -11.2 Columbia 63,202 59,798 -5.4 Schuylkill 152,585 145,994 -4.3 Crawford 86,169 93,048 8 Snyder 36,680 50,081 36.5 Cumberland 195,257 269,375 38 Somerset 78,218 70,323 -10.1 Dauphin 237,813 273,483 15 Sullivan 6,104 7,457 22.2 Delaware 547,651 553,900 1.1 Susquehanna 40,380 47,565 17.8 Elk 34,878 30,158 -13.5 Tioga 41,126 43,617 6.1 Erie 275,572 292,252 6.1 Union 36,176 47,465 31.2 Fayette 145,351 134,499 -7.5 Venango 59,381 50,852 -14.4 Forest 4,802 5,158 7.4 Wanen 45,050 38,306 -15 Franklin 121,082 133,312 10.1 Washington 204,584 191,085 -{j.6 Fulton 131,837 16,565 19.7 Wayne 39,944 51,333 28.5 Greene 39,550 42,484 7.4 Westrooreland 370,321 353,578 -4.5 Huntingdon 44,164 48,989 10.9 Wyoming 28,076 37,202 32.5 Indiana 89,994 93,834 4.3 York 339,574 415,934 22.5 Jefferson 46,083 40,533 -12 Juniata 20,625 21,058 2.1 Pennsylvania 11,882,643 12,569,017 5.8 Lackawanna 219,039 209,111 -4.5 Source: Paino' News Article 8/17/98from data supplied by Penn State Datn Center Connelly Road. Emmigsvil1e 7 I-OJ13C-2 CLAUSER REAL ESTATE APPRAISALS AREA ANALYSIS (Cont'd) Rel!ional Population Projections The population of the Capital Region is expected to reach 728,000 by the year 2020. It is going to playa significant role in improving the region's economy, as well as demand, especially in the lodging industry. York County population is expected to grow to 415,934 in the same period. " 1980 1990 Projected 1995 Projected 2000 Projected 2020 Cumberland Co. 178,541 195,257 202,755 209,325 269,375 Dauphin Co. 232,317 237,813 244,122 245,553 273,483 Lebanon Co. 108,582 113,744 118,151 120,323 129,742 Perry Co. 35,718 41,172 43,717 46,342 55,784 Capital Region 555,158 587,986 608,735 621,S43 728,384 City of Harrisburg 53,264 52,376 N/A N/A N/A York Co. 313,024 339,574 357,812 370,136 415,934 Lancaster Co. 362.346 422,822 437,948 462,918 597,975 TOTAL 1,230,528 1,350,382 1,404,505 1,454,597 1.742.293 Source: 1990 U.S. Census of Pop ulan on & HOUSing, Pennsylvan,a State Data Center Emplovment and Emplovers Area employment opportunities are good. According to a Central Penn Business Journal report dated February 18,2000, the Commonwealth of Pennsylvania employs 21,602 with Harrisburg being the State Capitol. The U.S. Government employs another 17,798+ most of which serve the two large supply depots, the Defense Distribution Center (DOC) at New Cumberland which employs 3,500 and the Naval Inventory Control Point (NA VICP) in Mechanicsburg which employs 5,526. Some of the other largest employers in Central P A include Hershey Foods Corp; Pennsylvania Blue Shield, a Highmark Co; Tyco Electronics-Amp; and the Hershey Medical Center. A list of the 50 top employers in the Central P A area is included for your reference on the next page. Connelly Road. Emmigsville 8 I-OJUC-2 CLAUSER REAL ESTATE APPRAISALS AREA ANALYSIS fCont'd) ErnDlovrnent and ErnDlovers fCont'd) CENTRAL PENNSYLVANIA'S LARGEST EMPLOYERS Commonwealth of Pennsylvania 21,602 United Defense Ground Systems Division 1,250 U. S. Government 17,798" School District of Lancaster 1,204 Hershey Foods Corp. 5,600 Richfood Region, Harrisburg Div. of Supervalu Inc. 1,193 Naval Support Activity, Mechanicsburg 5,526 Holy Spirit Health System 1,169 Pennsylvania Blue Shield, a Highmark Co. 5,308 The Bon-Ton Dept Stores Inc. 1,159 Tyco Electronics - AMP 5,200 Cumberland County 1,126 Hershey Medical Center 4,159 Harrisburg School District 1,100 Defense Distribution Center 3,500 Utz Quality Foods Inc. 1,023 Vorl< Health System 3,487 Book-of-the-Month Club Inc 1,010 PinnacleHealth System 3,452 PA Steel Tech Inc. Divof Bethlehem Steel Corp. 1,008 Armstrong World Industries Inc. 3,000 Supply Sales Co" 1,000 Wal-Mart Stores.lnc. 2,860 Allfirsl Bank 997 Harley-Davidson Molor Co 2,700 Fullon financial Corp 906 Lancaster General Hospital 2,199 Lear Corp 900 County of Lancaster 1,870 West Shore School District 884 New Holland North America Inc. 1,800 Conestoga Wood Specialities Corp 850 Electronic Data Systems 1,700 MlllersvUle University 837 U S Army War College & Carlisle Barracks 1,670 ABF Freight Systems Inc. """ 833 Capital Blue Cross 1,631 Dentsply International 820 High Industries Inc. 1,615 Masonic Homes 819 Fry Communications Inc. 1,586 Graham Packaging co. 810 Pennsytvania State University.... 1,503 Gannett Fleming Inc. 809 Vorl< International Corp 1,500 United Parcel Services 806 Susquehanna Pfaltzgraff Co. 1,458 School District of the City of Vorl< 805 P. H. Glatfelter Co. 1,300 Kinsley Construction 804 .Census last taken 1998: includes federal civilian employees only.. Estimated number ... Worldwide .... Includes Penn State Vorl< Central Penn Bwine.lS Journal Report dated February /8, 1000 Connelly Road. Emmigsville 9 1-0313C.2 CLAUSER REAL ESTATE APPRAISALS AREA ANALYSIS (Cont'd) Emplovment and Emplovers (Cont'd) Unemployment rates in the Capital Region have consistently been some of the lowest in the state. Harrisburg Regional Unemployment Rates - Oct 1996 - Mar 2001 Year Month % Month % Month % 1996 October 2.9 November 2.9 December 2.9 1997 January 2.7 February 2.8 March 3.0 April 3,.1 May 3.2 June 3.3 July 3.4 August 3.5 September 3.3 October 3.2 November 3.2 December 3.1 1998 January 3.0 February 3.0 March 3.1 April 2.8 May 2.8 June 2.8 July 2.8 August 2.9 September 3.3 October 3.2 November 3.2 December 3.1 1999 January 3.0 February 2.9 March 3.0 April 2.9 May 3.0 June 3.2 July 3.3 August 3.7 September 2.9 October 3.1 November 3.3 December 3.0 2000 January 2.8 February 2.9 March 2.5 April 2.6 May 2.5 June 2.6 July 2.6 August 2.7 September 2.6 October 2.7 November 3.1 December 2.8 2001 January 2.8 February 3.2 March 3.2 In conclusion, the York area has excellent vehicular and rail access to New York, Pittsburgh, Washington and other east coast areas. The general outlook appears to be one of stability with moderate growth. Connell)' Road. Emmigsville 10 1-0313("-2 ~.LAUS.~.tRM.kF.STAl'E APPRAISALS AREA MAe CLAUSER REAL EST ATE APPRAISALS NEIGHBORHOOD ANALYSIS The property being valued is located on Connelly Road in the York County Industrial Park approximately 4 miles north of the City ofY ork in suburban Manchester Township, York County, P A. The area is suburban in"nature and is defmed by a series of roads and natural boundaries with the Susquehanna River to the east, U. S. Route 30 to the south, U. S. Route IS and State Road 74 to the west, and the Pennsylvania Turnpike (1-76) to the north. 1-83 traverses the approximate center of the neighborhood. . . Connelly Road, on which the subject fronts, runs north from Busser Road. The subject property is located in the York County Industrial Park with Farmbrook Industrial Park and Berkshire Business Park to the west and 1-83 Industrial Park and Orchard Industrial Park to the north. Uses in the vicinity of the subject are predominately industrial and include Pavan USA Inc., Trenwyth Industries, Fry Communications Directory Service, FCI Framatone Group, Relizon, and York Saw and Knife. The neighborhood is estimated to be 60% development with vacant land available for new construction and the area is in a growth stage. Utilities in the neighborhood include electricity, telephone, public water, public sewer, and natural gas. Prices within the neighborhood vary and generally depend on the type of property and its existing use. Generally housing prices range from $80,000 to in excess of$300,000 with ages ranging from new to 50 years. Rentals range from $450-$1000+ per month, with exceptions of course. Commercial and industrial uses range in price from $100,000 to over $5,000,000 with ages ranging from new to 40+ years. Commercial and industrial rentals range from $3.00 to $14.00 per square foot depending on the services and utilities included. Generally the area appears to be experiencing a vacancy rate in the range of5% to 10%. Properties qualifY for all types of financing with mortgage money available for residential, commercial and industrial properties through numerous lending institutions and the York County Industrial Development Authority. Neighborhood values are stable and are expected to remain that way as long as mortgage interest rates remain at current levels and there are no major downturns in the economy. Connelly Ibd, Enmipvine 11 1~13C.2 1921L "N 0-% CONNEL- f!~ ~ ~.:{ '" s: . " o " 'i o og ~ ~ '" RO~D 2' \ " ~ ~ "' ~ :0 C se;~oDC 0 s""'>^ ~ ".ORN B 2' ISRA ( G. J Co"", .--..,e~O '. "'"* , , ; I .' )/:' 8 c CLAUSER REAL ESTATE APPRAISALS SITE ANALYSIS The Sharretts Plating company plant is located on the west side of Connelly Road in the York County Industrial Park in suburban Manchester Township, Emigsville, York County, P A. The site consists ofa rectangular shaped lot containing 3.157 acres. Dimensions of the lot are 550' x 205' x 550' x 250' with 250' frontage on Connelly Road per deed measurements. . Topography of the site has a slight downward slope from east to west. A detention pond is !.Pcated at the west end of the site. The area west of the building is grass covered. Paved and marked parking is available in front of the building for approximately 24 cars. Additional paved area in the front of the building provides truck access to the front dock areas and a paved drive on the north side of the building allows truck access to the warehouse portion of the building. " Utilities on-site include: Electricity .,Gas Water Sewer Metropolitan Edison Columbia Gas Company York Water Company Springettsbury Township Zoninl! . The subject property is zoned I-Industrial District by Manchester Township Zoning Ordinance, Permitted uses in this zoning include manufacturing, warehousing, truck terminals, corporate offices, agribusiness, professional offices, mobile home parks, mini-storage warehouses, and similar uses. Area and bulk regulations for manufacturing use are as follows Minimum Lot Size 20,000 SF Maximum Building Coverage 60% Maximum Building height 50 Feet Minimum Street Frontage 100 Feet Front Yard Setback 30 Feet Rear Yard Setback 30 Feet Side Yard Setback 30 Feet An extract of the zoning Ordinance pertaining to Industrial District is included at addenda, The current use as a plating facility is a legally permitted use under current zoning regulations, Connell)' Rcat, EtmUpville 12 1.(l]13C-2 CLAUSER REAL ESTATE APPRAISALS SITE ANALYSIS (Cont'd) Hazardous Materials/FIood Information The appraiser has no knowledge of underground storage tanks or hazardous materials on site in the soil or subsoil, or gases found in the environment such a toxic waste or radon gas, etc., which may or may not be present in the property. A number of empty barrels were located outside at the northwest comer of the building and in a storage yard but the appraiser was not qualified to determine if any of the barrels contained toxic materials. I urge the client to retain an expert on these matters with DEP Phase i c:rtification suggested. This appraisal is based on clear certifications for any and all testing conducted and assumes the property is cleared ofhl!Z8!dous materials. Based on information obtained from the U.S. Department of Housing & Urban Development, Federal Insurance Administration Flood Maps, the subject is located in Zone C ofHUD identified flood hazard area and does not require flood insurance. The flood map is dated December, 1981, Community Number 420931-00IA. ",,' Connelly Ro.I, Bmmipville 13 l-OlUC-2 H ---or l i --'J"f ( ~==== r I " II \I " 11 " " " " II -'I- II " II \ ~=====- " " " " " \ .....J~ /~";/' \ ~.... \ v,-/ '" L_\_ \ . . , ,i / / ..----/~ .' ., , . , ~- . If_" / / /.- -.-/ -, ", v' I I I ,I " l' .----' (i I I ' I \ 'lo; .' .j " -;;' ,- -=-~~\ .-. . 4' \, I \\ \\ " " "f ...::::- ; I -\ \I ~.... " ..;\\ ~=I t~ k ,Ii If hi -, . , -; .' . i I i J t ~ i i ; ~ I ~ . ,I :! ., , , I" h [.IUll !I ~r.i.:.t. ......;p.. I' ~ ,I ili" l!\\N ___~_.______._ .___.. - __ .______ ,_'.__._n_ .____________.. , -~- I .. AQMIClIlTUIW. WIIlICT COPEH sPAa:l) [::xJ RES/llUmA!. lOW DfN~1Y DlSfRlCT (OfI'f:H SPACI:) ~ AESIO(HnAl WEDIW llEHSlI'r OI$IRICT (OPEN SPACE) [!!] RfSIDEHnAL"GH DENSITY DISTRICT "C"'CEOISlJOCl liE COIM.lEAaALlllSnllCT ~I<<lUSIRlAl.lllSTRtCT ~ PMWlUS-Y APPIlO'4D PI.ANNfD MS. MV. , 1'1"1'<.:1l~ l(wuu<.:J I" INUI'~TIII.-\I. h, \1-I\\nN.-\f'-ll'l,II'JI-<Ih . LII.....:IIH.I..'I;,~J1 ":"HIP IANfA "/CIAL ~ __ .!!y',_,nM!!!l!n..1!!P' CLAUSER REAL ESTATE APPRAISALS IMPROVEMENT ANALYSIS The improvements being considered in this appraisal consist of a one-story concrete block and steel light manufacturing building containing 39,088 square feet. Building has a flat built-up roof over steel panels on steel joists with 16 foot clearance height. The original portion was built in 1974 with four additions added since that time. A 17,937 square foot area of the roof is in need ofreplacement. Copies of Centimark cost estimates are included in the addenda. The Tuff Span Re-roofmg proposal is considered the one to be installed. A 20' x 81' fmished office area at the front of the building has an entry foyer, receptionist/secretarial area, small office, storage room, plant managers office, presidents office, r~stroom aiJd hallway with kitchenette area. A men's restroom, women's restroom, and finished storage closet are also part of this area but are only accessible from the plant area. Interior finishes include c8.lpeted floors, painted drywall or paneled walls, 2' x 4' suspended ceiling tile and recessed fluorescent lighting. The 'president's office has marble floors, painted and wallpapered drywall walls with chair rail, and painted ceiling with dental style crown mould. The restroom has commode and lavatory and the kitchenette area has refrigerator, microwave, metal sink and stove area. The two restrooms that are accessible from the plant have painted drywall walls and ceilings, vinyl composition flooring and the ladies restroom has two commodes and one sink while the men's restroom has two commodes, urinal and sink. This area is heated and air conditioned. Other tcished areas within the plant include: a 16' x 19' laboratory with ceramic tile floor, painted drywall walls, 2' x 4' suspended acoustical tile ceiling, base, upper and island cabinets with laminated counter surface and two-bowl stainless steel sink and air conditioner; 12' x 20' inspection room with concrete floor, painted drywall walls and base cabinet area; two offices, one 12' x 12' and one 11' x 12', are located adjacent to the slitter room and have c8.lpeted floors, painted drywall walls and 2' x 4' acoustical ceiling tile; a lunch room with painted drywall and concrete block walls, vinyl composition flooring and 2' x 4' acoustical tile is located over the last two offices. The 32' x 72' slitter room has concrete floor, painted dry wall walls, 2' x 4' acoustical ceiling tile, fluorescent lighting, and is heated and air conditioned. The slitter room provides heating and air conditioning for the two adjacent offices and the lunch room. The production areas of the plant include main shop area with maintenance shop; waste treatment area with boilers; rack line area, and warehouse. A partial basement 13' wide and approximately 120' long is located under the south side of the building in the waste treatment area. The main shop area has both fluorescent and high pressure sodium lights. The plant has two 3000 Amp electric services, 6,000 CFM air make-up system, 3 chiller units, 5 ceiling exhaust fans, 9 overhead garage doors (4 with automatic door openers and 3 with load leveler docks), and an overhead craneway is located in the slitter room. An 80-gallon and a 40-gallon electric . hot-water heater and an 82-gallon gas hot-water heater area also located in the plant area. An unused diesel/fuel oil storage tank has been filled and certified. Personal Prooerty: No personal property, machinery, or equipment is included in this valuation. Connelly ao.t, Bmmipvilk 14 1-G313C-2 CLAUSER REAL ESTATE APPRAISALS IMPROVEMENT ANALYSIS The improvements being considered in this appraisal consist of a one-story concrete block and steel light manufacturing building containing 39,088 square feet. Building has a flat built-up roof over steel panels on steel joists with 16 foot clearance height. The original portion was built in 1974 with four additions added since that time. A 20' x 81' finished office area at the front of the building has an entry foyer, receptionist/secretarial area, small office, storage room, plant managers office, presidents office, restroom and hallway with kitchenette area. A men's restroom, women's restroom, and finished storage clo~et are also part of this area but are only accessible from the plant area. Interior finishes include ~arpeted floors, painted drywall or paneled walls, 2' x 4' suspended ceiling tile and recessed fluorescent lighting. The president's office has marble floors, painted and wallpapered drywall walls with chair rail, and painted ceiling with dental style croWn'mould. The restroom has commode and lavatory and the kitchenette area has refrigerator, microwave, metal sink and stove area. The two restrooms that are accessible from the plant have painted drywall walls and ceilings, vinyl composition flooring and the ladies restroom has two commodes and one sink while the men's restroom has two commodes, urinal and sink. This area is heated and air conditioned. Other finished areas within the plant include: a 16' x 19' laboratory with ceramic tile floor, painted drywall walls, 2' x 4' suspended acoustical tile ceiling, base, upper and island cabinets with laminated co~ter surface and two-bowl stainless steel sink and air conditioner; 12' x 20' inspection room with concrete floor, painted drywall walls and base cabinet area; two offices, one 12' x 12' and one 11' x 12', are iocated adjacent to the slitter room and have carpeted floors, painted drywall walls and 2' x 4' acoustical ceiling tile; a lunch room with painted drYwall and concrete block walls, vinyl composition flooring and 2' x 4' acoustical tile is located over the last two offices. The 32' x 72' slitter room has concrete floor, painted dry wall walls, 2' x 4' acoustical ceiling tile, fluorescent lighting, and is heated and air conditioned. The slitter room provides heating and air conditioning for the two adjacent offices and the lunch room. The production areas of the plant include main shop area with maintenance shop; waste treatment area with boilers; rack line area, and warehouse. A partial basement 13' wide and approximately 120' long is located under the south side of the building in the waste treatment area. The main shop area has both fluorescent and high pressure sodium lights. The plant has two 3000 Amp electric services, 6,000 CFM air make-up system, 3 chiller units, 5 ceiling exhaust fans, 9 overhead garage doors (4 with automatic door openers and 3 with load leveler docks), and an overhead craneway is located in the slitter room. An 80-gallon and a 40-gallon electric hot-water heater and an 82-gallon gas hot-water heater area also located in the plant area. An unused diesel/fuel oil storage tank has been filled and certified. Personal ProoerlY No personal property, machinery, or equipment is included in this valuation. Connelly Ilt*l, I!ImlipYillc 14 1-031JC-2 -- .-.- . ....- .. - --- ---- u.. , SHARRETTS PLATING COMPANY CONNELLY ROAD, EMIGSVlLLE, PA 151.0' 110.0' . . , - 20.0' 231.5' ... . . 142.5' 90.0' 21.0' 81.0' . SKETCH CALCULATIONS ______._.__0_'_ ...n_. --...,-.--- - ...~._-,_. ------- Building Area Level One A1: 151.0x 110.0= 16610.0 A2: 171.0 x 121.5 = 20776.5 .. A3: 81.0x 21.0 c 1701.0 39087.5 Totel Building Area 39087.5 CLAUSER REAL EST ATE APPRAISAL Receptionist/Secretary Area ",' Office CLAUSER REAL ESTATE APPRAISAL , Office WY.. Lab CLAUSER REAL EST ATE APPRAISAL Quality Control . Plant Area ",' CLAUSER REAL ESTATE APPRAISAL Plant Area ,..,. ] I I I ] ] CLAUSER REAL EST ATE APPRAISAL Boiler Room [ [ I ] I ~.,. Plant Area CLAUSER REAL ESTATE APPRAISAL Plant Area [ I I I Slitter Area If"~. 1 I I " I J , I J I' I I .' I .' I , , .' , CLAUSER REAL ESTATE APPRAISAL Warehouse Area . '-'''' . CLAUSER REAL ESTATE APPRAISALS HIGHEST AND BEST USE The highest and best use of a property is that use to which the land can be put which will create the greatest utility for the land, be it in profit or in amenities, and that which is permitted or would be permitted by the local municipal or township authorities and that which would not be unduly objectionable to the character of the surrounding property, and keeping within the scope of the general neighborhood development. Highest and best use may be defined as follows: r I . The reasonably probable:! and legal use of vacant land or an improved property, which is physically possible, appropriately supported, financially feasible, and that results in the highest value. The four criteria the highest and best use must meet are legal permissibility, physical possibility, financial feasibility and maximum productivity. (The Dictionary of Real Estate Appraisal, Third Edition, 1993 pg. 171) l' , Highest and best use reflects a basic assumption about real estate market behavior; that the price a buyer will pay for a property is based on their conclusions about the most profitable use of the site or property. The determination of highest and best use must be based on careful consideration of prevailing market conditions, !rends affecting market participation and change, and the existing use of the subject property. In estimating highest and best use, there are essentially three states of analysis- A. Possible use- uses to which it is physically possible to put the site in question. B. Permissible use- legal uses permitted by zoning and deed restrictions on the site in question. . C. Feasible use- possible and permissible uses that will produce the highest net return, or highest present worth. The highest and best use of the land (site), if vacant and available for use, may be different from the highest and best use of the improved property. This is normally true when the improvements are not an appropriate use and yet make a contribution to the total property value in excess of the value of the . . site. Connelly Ro.d, BmmipYille ]5 1-0313C-2 CLAUSER REAL ESTATE APPRAISALS HIGHEST AND BEST USE - (Cont'd) The following test must be passed in detennining the highest and best use: A. The use must be legal. B. The use must be probably, not speculative. C. There must be a profitable demand for such use. D. It must return to the land the highest net return for the longest period of time or be maximally productive. . Because the use ofJand can be liinited by the presence of improvements, highest and best use is detennined separately for the land or site.as though vacant and available to be put to its highest and best use, or for-the property as improved. " , The first detennination reflects that land value is derived from potential land use. Land has limited value unless there is a present or anticipated use for it. The amount of value depends on the nature of the land's anticipated use according to the concept of surplus productivity. Among all reasonable, alternative uses, the use that yields the highest present land value, after payments are made for labor, capital, and coordination, is generally regarded as the highest and best use of the land as though vacant. This is the "classic" definition of a land residual analysis. For the purpose of analysis, the appraiser assumes-that"the parcel ofJand in question is vacant. Even a site with a large building on it can be made vacant by demolishing the building. The question to be answered is: If the land were vacant, what new improvement(s) should be constructed on the site? The highest and best use of a property as improved refers to the optimal use that could be made of the property including all existing structures. The implication is that the existing improvement should be renovated or retained so long as it continues to contribute to the total market value of the property, or until the return from a new improvement would more than offset the cost of demolishing the existing building and constructing a new one. The determination of the highest and best use ofland as though vacant is useful for land or site valuation. Detennining the highest and best use of an improved property provides a decision regarding continued use or demolition of the property. [The reader should note that demolition is indicated when the land as though vacant has more value than the parcel as presently improved.] Connelly RoM, Bmmipville 16 1~lJc.2 CLAUSER REAL ESTATE APPRAISALS HIGHEST AND BEST USE - (Cont'd) The relationship between the supply of, and demand for, land adaptable to a particular use is significant in determining highest and best use. A site or improved property may be placed under an interim use until demand is sufficient to support its highest and best use. If a more profitable use must be delayed due to insufficient present demand, the interim use will continue until the value of the land as though vacant, minus the cost of demolishing the existing improvements, exceeds the total value of the improved property at its current use. W)1en properties are devoted to temporary, interim uses, the concept of consistent use must be . addressed. Consistent use is the concepf that land cannot be valued on the basis of one use while the improvements are valued on the basis of an~ther. Improvements that do not represent the land's highest and best use,but do have substantial remaining physical lives, may have an interim use of temporary value, or they may have no value at all. The highest and best use analysis requires the employment of various categories of use-oriented decisions. To conclude that a given use is the highest and best use, the use must meet four criteria. As previously indicated, the highest and best use must be: tt..... " I) legally permissible; 2) physically possible; 3) financially feasible; and 4) maximally profitable. In sequential order, usually from the most general to the most specific, each criteria is considered in turn, thereby eliminating at each level, proposed uses that do not qualify. This process stimulates the thought process of the rational and informed decision maker and helps the appraiser identify the most likely users and buyers for the subject property. Hil!hest and Best Use As Thoul!h Vacant and Available for Development - Highest and best use of land or a site as though vacant is defmed as the use of a property based on the assumption that a parcel of land is vacant or can be made vacant through demolition of any improvements. Land value, as though vacant, is a fundamental concept of valuation theory and the basis for the Cost Approach. The four factors of highest and best use, that is whether the use is legally permissible, physically possible, financially feasible, or maximally profitable will be developed for the property as though it . were vacant and available for development. ConndIy RoId, ErmUpvalk 17 1-0313C-2 CLAUSER REAL ESTATE APPRAISALS HIGHEST AND BEST USE - (Cont'd) Lee:ally Permissible: The subject is zoned Industrial (1) by Manchester Township. Permitted uses in this district include light manufacturing, warehousing, truck terminals, and similar uses. Physically Possible: Adetailed description of the subject site is presented in the Site Analysis section. The site's physical characteristics and adjacent neighborhood uses support industrial use. All of the legally permitted uses appear to be physically possible on the subject site; however, light manufacturing use would benefit from the overall size of the subject site. Financially Feasible: Of the legally Jlermitted uses that would most effectively maximize the land, it would appear that light manufacturing use could be the most financially feasible for the subject site. Maximally Profitable: Considering the legally permitted uses, surrounding neighborhood uses and zoning, it would appear that the highest and best use, as vacant, for the subject property is for use as light manufacturing development. " Hie:hest and Best Use as Imnroved - The highest and best use as improved is defined as the use that should be made of a property as it exists. There are two reasons to analyze the highest and best use of a property as improved. The first is to identify the property'use(s) that can be expected to produce the highest overall return for each dollar of capital invested. The second reason is to help identify comparable properties in the Sales Comparison and the Income Approach sections of this analysis. The subject property is a 39,088 square foot masonry and steel building on 3.157 acre site. As in the previous analysis, the four factors of highest and best use must be studied. These are legal, permissible, physically possible, financially feasible, and maximally profitable. Lee:ally Permissible: A summary description of the improvements was presented in the Improvement Description. The surrounding neighborhood is comprised primarily of manufacturing and warehouse uses to include light manufacturing. Although other uses are legally permissible, the subject's design and layout are most conducive to use as a light manufacturing facility. ComcI", R.-d, Emnripville 18 t.o313C2 CLAUSER REAL ESTATE APPRAISALS HIGHEST AND BEST USE - (Cont'd) PhvsicalIv Possible: As noted in the Site Analysis, the subject is physically adaptable to light manufacturing use with other light manufacturing and warehouse uses proximate the location. FinancialIv Feasible:' As previously noted use as light manufacturing could be considered the most financially feasible. MaximalIv Profitable: The highest and best use is usually a long term consideration, expected 10 rPmain pn the site for the normal useful life of the improvements. It represents that use which results in the highest value. The subject is a 39,088 square foot building located in an area comprised of light manufacturing, warehouse and truck terminal uses and should provide maximum profitability for the site. Conclusion: Based on the foregoing factors, the highest and best use of the subject property, in my opinion is its legally permitted conforming use as a light manufacturing facility. " "".' Connelly ItoMt, I!mnipville 19 1..o313CI CLAUSER REAL ESTATE APPRAISALS V ALVA nON PROCESS AND SCOPE OF APPRAISAL The purpose of this appraisal is to estimate the market value of the fee simple title to the subject property. The goal of the valuation process is a well documented and supported value conclusion that reflects the appraiser's study of all factors that influence the market value of the property being appraised. In order to do this,. the appraiser usually studies a property from three different view points which are typically known as the three approaches to value. They are as follows: . I. The Cost Approach whereby the current cost of reproducing or replacing the improvements . less the loss in value from depreciation equals a depreciated cost ofimprovernents. To this depreciated cost ofimprovenrents, the value of the land is added to arrive at an indication of value. 2. The Income Capitalization Approach looks at the earning power of the subject property, its income of anticipated future benefits and capitalizes this into an indication of value. , 3. The Sales Comparison Approach is that approach to value whereby the subject property is compared to other recent sales of comparable properties to arrive at an indication of value. If/" , Information for the application of the three approaches to value is obtained from the market through res~ch and analysis and it should be noted that the approaches are interrelated. Separate indications of property value are usually derived from each approach. These approaches to value are shown on the following pages. ConneII)'ao.d,llIm1ipv'l1lc 20 1..oJIJC-2 CLAUSER REAL ESTATE APPRAISALS COST APPROACH Approach through which an appraiser derives a value indication of the fee simple interest in a property by estimating the current cost to construct a reproduction of or replacement for the existing structure, deducting for all evidence of accrued depreciation from the cost new of the reproduction or replacement structure, and adding the estimated land value plus an entrepreneurial profit. (The Dictionary of Real Estate Appraisal Second Edition, Page 72). Reproduction cost will be used in this appraisal and may be defined as: . The cost of construction at current prices of an exact duplicate or replica using the same materials, construction standards, design,Jayout and quality of workmanship and embodying all of the deficiencies, superadequacies and obsolescence of the subject building. (The Dictionary of Real Estate appraisal Second Edition, Page 254). .' The Cost Approach is based on the proposition that a knowledgeable buyer would not pay more for a property than the cost of building a new property to the same utility. The Cost Approach to value consists of the following steps and includes the valuation of the land: 1. Estimate the value of the land as though vacant ana available to be developed to its highest and best use. 2. Estimate the reproduction cost of the building on the effective date of appraisal. 3. Estimate the amount of depreciation in the structure including physical deterioration, functional obsolescence and extemal obsolescence. 4. Deduct the estimated depreciation from the reproduction cost of the structure to estimate the buildings contribution to value. 5. Estimate the depreciated cost of other structures and site improvements. 6. Add the depreciated value of buildings, other structures and site improvements to the site value to arrive at an indication of value by the Cost Approach. Cost Approach figures were obtained from Marshall Valuation Service and/or local contractors. The Cost Approach analysis and calculations are shown on the following pages including land valuation. Connelly IlMd, Ennipville 21 l.03UC.2 CLAUSER REAL ESTATE APPRAISALS COST APPROACH - (Cont'd) MARKET STUDY - COMPARABLE LAND SALES This Approach yields an indication of value by comparing recent sales of similar properties, and making adjustments for time, location, physical and other differences. Among the area sales reviewed were the following: Land Sale 1 . . Grantor , Francis C. and Margaret McNaughton , Grantee Central Pennsylvania Blood Bank Tax Map No. 63-022-055 Location 8170 Adams Street, Harrisburg, Swatara Township, Dauphin County, PA LotStze 2.14 acres Zoning M-L Manufacturing District - Limited Date Sold September 21,2000 . Consideration $175,000 Deed Book 3771, Page 0076 Indicated Price per Acre per SF $81,776 $1.88 Verification of Sale Courthouse Records ec.meIly RaId, Emrnipvine 22 1-03IJC2 CLAUSER REAL ESTATE APPRAISALS COST APPROACH. (Cont'd) Land Sale 2 Grantor David l Wilke Jr. & Elizabeth P. Wilke Grantee Eugene A. & Sherry K. Beam Tax Map No. 36-27-450A . Location Fanntrail Road, Manchester Township, York County, P A Lot Size 3.08 gross acres ofland per survey, Public water and sewer to property. Zoning Industrial " Date Sold February, 1998 It'"" Consideration $212,000 Deed Book 1315, Page 3897 Indicated Price Per acre $68,200 Verification of Sale Courthouse Records and Grantor Connelly ROId, BnwnipYille 23 J-0313C2 COST APPROACH - (Cont'd) Land Sale 3 Grantor Grantee Tax Map No. Location Lot Size Zoning Date Sold Consideration " Indicated Price per Acre per SF Verification of Sale ComadIyRced,~lJe CLAUSER REAL ESTATE APPRAISALS Frances C. and Margaret McNaughton Shaffer and Son IncOl:porated 63 022 052 Lars, Presidents Drive, Swatara Township, Harrisburg, Dauphin County, PA. (Also fronts on Adams Avenue). . - Irregular 1.41 acres M-L Manufacturing District - Limited October, 1998 $90,000 Deed Book 3218, Page 449 $63,830 $1.47 Courthouse records 24 l-olt3C2 CLAUSER REAL ESTATE APPRAISALS COST APPROACH - (Cont'd) Land Sale 4 Grantor Susan M. Ritter Grantee The Storing Crew Tax Map No. 13-10-0256-004 . Location Comer of Westport Drive and Rossmoyne Road, Lower Allen Township, Mechanicsburg, Cumberland County, PA Lot Size 6.21 Acres or 270,368 SF .' Zoning Light Industrial Date Sold November, 1999 Consideration $380,000 Deed Book 211, Page 14 If!" Indicated Price pI:!' Acre $61,192 per SF $1.40 . Verification of Sale Courthouse Records c.o.-IlyRo.d.l!mmipville 25 1-0313C-2 COST APPROACH - (Cont'd) Land Sale 5 Grantor Grantee Tax Map No. . . Location Lot Size Zoning Date Sold Consideration ~ Indicated Price per Ac!e per SF Verification of Sale Camelly IlC*I, Blrmipville CLAUSER REAL ESTATE APPRAISALS Ruth J. Pickel Walsh Higgins No. 37 LP 36-006-015 FuHing Mill Road, Lower Swatara Township, Middletown, Dauphin County, PA 9.61 acres I-Industrial July, 1998 $602,340 Deed Book 3155, Page 0019 $62,678 $1.44 Courthouse Records 26 1~313C.2 CLAUSER REAL ESTATE APPRAISALS COST APPROACH - (Cont'd) . . LAND SALES COMPARISON ADJUSTMENT GRID Land Price Per Adjustment Percentage Adj. Sale # SF Time Location Land Price Per Area SF 1 $81,776 +l +5 -5 $82,594 2 $68,200 +9 0 0 $74,338 3 $63,830 +7 +5 -5 $68,298 4 $61,192 +4 +5 +5 $69,759 5 $62,678 +8 0 +8 $72,706 Exolanation of Adjustments Land Sale I is a smaller tract which would normally sell at a higher price per acre with a downward adjustment appropriate. Upward adjustments are made for inferior location and time since sale of comparable. Adjusted price per acre ofland is $82,594 .. Land Sale 2 has an upward adjustment for time since sale of comparable. Adjusted price per acre ofland is $74,338 Land Sale 3 is given a downward adjustment for smaller land area Upward adjustments are made for comparables inferior location and time since sale. Adjusted price per acre ofland is $68,298 Land Sale 4 has upward adjustments for time since sale, inferior location and larger land area of comparable which would tend to sell at a lower price per acre. Adjusted price per acre ofland is $69,759 Land Sale 5 is given upward adjustments for comparables larger land area and time since sale. Adjusted price per acre of land is $72,706 ConndIy Roed, Ilnnipville 27 l..oll3C2 CLAUSER REAL ESTATE APPRAISALS COST APPROACH (Cont'dl Reconciliation Based on the above adjustment grid; the value range indicated for the subject tract extends from a low of $68,298 to a high of $82,594 per acre. The mean of the five sales is $73,539 per acre. Sale 2 is considered most similar and given greatest weight with the estimated land value for the subject tract being $75,000 per acre. . ThC<l"efore, the indicated land value for the plant site as of April 27, 2001 is: 3.157 acres @ $75,OOQ p!lr acre = $236,775 rounded to $235,000 ~,. " Connelly R.OlIlI., Emmipville 28 !..(I313C2 CLAUSER REAL ESTATE APPRAISALS , COST APPROACH - (Cont'dl Cost Aooroach Summary Reoroduction Cost New Subject building is a good Class C Light Manufacturing Industrial Building fully heated and partially air conditioned. Bui!ding Calculations _ . 39,088 SF @ $44.00 per SF $1,719,872 Less Depreciation Physical 25% Age and condition Functional 0% Floor plan and design External ~ Location and flood plain Total ~. 25% Total Depreciated Cost of Building - 429.968 $1,289,904 Site Improvements Paving, lighting, landscaping, detention pond etc 75,000 Land by Sales Comparison Total by Cost Approach 235.000 $1,599,904 Rounded to $1,600,000 Indicated value of subject on 3.157 acres by Cost Approach as of April 27, 2001: ONE MILLION SIX HUNDRED THOUSAND - ($1,600,000) - DOLLARS Connelly ao.d, EmrrriP"iJle 29 I-OJI:JC-2 CLAUSER REAL ESTATE APPRAISALS INCOME CAPITALIZATION APPROACH Approach through which an appraiser derives a value indication for income-producing property by converting anticipated benefits, Le., cash flows and reversions, into property value. This conversion can be accomplished in two ways: One year's income expectancy or an annual average of several years income expectancies may be capitalized at market-derived capitalization rate or a capitalization rate that reflects a specified income pattern, return or investment, and change in the value of the investment; secondly, the annual cash flows may be discounted for the holding period and the reversions at a specified yield rate. (The Dictionary of Real Estate Appraisal Second Edition, Page 156). . . This type of income producing property is normally purchased for owner occupancy or as an investment. As a result, the earning cap~ci!y of this property is an important ingredient in estimating its value. Investors who purchase this type of property trade their present dollars for an income flow of future dollars plus the return or their investment at some future date. The Income Approach consists of the following steps: 1. Estimate the potential gross income of the property. 2. ~dd additional income from other sources. 3. Subtract the typical market derived rent loss that occurs from vacancies, credit losses and <<ollection problems. 4. The resulting number is the effective gross income (E.G.!.) 5. From the E.G.!. subtract normal operating expenses, fixed expenses and reserves for the replacement of short lived building components. 6. This results in the net operating income (N.O.!.) 7. Develop a direct capitalization rate. In this appraisal, the band of investment-mortgage- equity technique will be used. 8. Divide the N.O.I. of the property being appraised by the appropriate capitalization rate which gives an indicated value by the Income Approach. These steps are presented on the following pages. ColmdIy R..t, BrnmipYille 30 1-03I3C-2 CLAUSER REAL ESTATE APPRAISALS INCOME CAPITALIZATION APPROACH - (Cont'dl Potential Gross Income - IndustriallWarehouse Leases Area leases of industrial and warehouse spaces were studied in an effort to arrive at the market rental for the subject property. Due to the confidential nature of lease information, I am unable to divulge lessors and lessees. Exact addresses are not given. Among the leased space reviewed were the following: . ].. A .142,116 square foot warehouse with office space, located on Grumbacher Road, Manchester Township, York, is on a five-yeat extension of its original leases. Lease rate is $4.21 per square foot on a triple net basis and will im;rease to $4.81 per square foot at the commencement of the next five year extension. 2. An 88,882 square foot warehouse area in a newer building on South 10'" Street, Lemoyne is leased for 5 years on a triple net lease at $3.78 per square foot. Tenant has one five-year renewal option at an increased rental rate. 3. An industrial building in the 7100 block of Grayson Road contains 20,000 square feet and is leased for three years on a triple net lease at $4.45 per square foot. 4. 75,000 square feet of a 120,000 square foot building on Independence Drive, Upper Allen Business Park is leased for 3 years for $4.20 per square foot. This is a triple net lease and building has 28' ceiling height. 5. A 94,000 square foot building on Independence Drive, Upper Allen Business Park, Mechanicsburg has 65,000 square feet of area leased at $4.05 per square foot. This is a five year triple net lease and building has 30' ceiling height. CoIlndIy Ilt..t, Emmipvilk 31 1...031JC-2 CLAUSER REAL ESTATE APPRAISALS INCOME CAPITALIZATION APPROACH - (Cont'd) . Lease I Lease 2 Lease 3 Lease 4 Lease 5 LEASE ADmSlMENT GRID Lease # Price Per SF Adjustment Percentage Adj. Price Bldg. Size Office Utility Per SF Area I $4.21 +8 0 -5 $4.34 2 $3.78 +5 +5 -5 $3.97 3 $4.45 -5 0 -5 $4.01 4 $4.20 +5 +5 -5 $4.41 5 $4.05 +5 +5 -5 $4.25 Exolanation of Adjustments is a larger building which would normally rent at a lower price per square foot with an upward adjustment warranted. Downward adjustment is made for comparables higher ceiling height utility. Adjusted price per square foot of rental area is $4.34. has a downward adjustment for superior utility of comparable. Inferior office area and larger building size have upward adjustments. Adjusted price per square foot of rental area is $3.97. is given downward adjustments for smaller building size which would tend to rent at a higher price per square foot and for superior utility. Adjusted price per square foot of rental area is $4.01. has upward adjustments for larger building size and inferior office area. Comparables superior utility has a downward adjustment. Adjusted price per square foot of rental area is $4.4 I. is given upward adjustments for larger building area and inferior office area. Superior utility of comparable has a downward adjustment. Adjusted price per square foot of rental area is $4.25. Based on these and other leases studied, plus discussions with area commerciliJ. brokers, the estimated rent per square foot is in the $3.75 to $4.25 range on a triple net lease basis. For the purpose of this appraisal $4.20 per square foot will be used for the Income Capitalization Approach. A recent industrial market study prepared for Winter 2000-2001 by James W. Brady, Vice President Industrial of Landmark Commercial Realty, Lemoyne, PA, indicates the overall occupancy level in the regions industrial market is 92%. In the class III category, which is industrial with 16' to 24' clear ceiling heights, there is currently a 9% vacancy rate in the approximately 4,000,000 SF of leasable space on the market. . Conndfy RoId, Emmipvi!k 32 1..o313c.2 CLAUSER REAL ESTATE APPRAISALS INCOME CAPITALIZATION APPROACH (Cont'd) Income and Expense Summary Estimated Gross Income 39,088 SF @ $4.20 per SF Less Vacancy and C01lection 10% Effective Gross Income . . Less Operating Expenses Variable Expenses Management and leasing fees 5% (The market indicates that properties similar to the subject are leased on a triple net basis repairs with tenants responsible for heat and electric, maintenance and a1l repairs) LegaYAccounting Reserve for Replacements 2% Roofs, structural, etc Total Estimated Expense and Reserves for Replacement Estimated Net Operating Income Cam<lIy...... -'" 33 $7,470 2.400 $164,170 - 14.775 $149,395 $9,870 2.988 - 12.858 $136,537 1-O:Jt3C2 CLAUSER REAL ESTATE APPRAISALS INCOME CAPITALIZATION APPROACH - (Coot'd) The current prime rate is 7.5% with typical commercial lending institution loans in the 8.0% to 8.5% range, with exceptions of course. I have selected the Band of Investment Technique for deriving a capitalization rate. This technique is based on the premise that the market value of investment real estate is affected by the availability and terms of mortgage money, equity buildup and a return that counts for risk and return on and of equity capital. . . I have set forth a possibility of a 11.0% mortgage interest rate with 75% loan to value ratio for a term of20 years. An investor contributing the balance of25% would be attracted to an investment with a 10% return on his investment which results in an overall rate ofIO.03%. This technique is set forth as follows; MORTGAGE EOUITY CAPITALIZATION 75% MORTGAGE. 8.0% INTEREST. 20 YEARS WEIGHTED It..- PORTION RATE RATE Mortgage .75 x .1004 = .0753 Equity .25 x .10 = .0250 Weighted Average 1.00 . .1003 BASIC FULL TERM CAPITALIZATION RATE .1003 Net Operating Income; $136,537 .. .1003 = $1,361,286.14 rounded to $1,360,000 Therefore, the value indicated by the Income Capitalization Approach for the building on 3.157 acres as of April 27, 2001 is: ONE MILLION THREE HUNDRED SIXTY THOUSAND... ($1,360,000) ... DOLLARS CamelI)' rto-i,l!mmipytlle 34 1-0313C-2 CLAUSER REAL ESTATE APPRAISALS SALES COMPARISON APPROACH The approach through which an appraiser derives a value indication by comparing the property being appraised to similar properties that have been sold recently, applying appropriate units of comparison and making adjustments, based on the elements of comparison, the sale price of the comparables. (The Dictionary of Real Estate Second Edition AIREA, Page 265). In applying the Sales Comparison Approach, the appraiser takes the following steps: . . I.. Researches the market and selects the sales and/or listings of properties most comparable to the property being appraised'. Generally, the most current and similar comparable sales prove to be best indicators of.th!' value of the subject. 2. Collects and verifies data on each selected property's selling and listing prices, dates of sale, physical differences, locational characteristics and any special conditions. 3. Analyzes and compares each property with the subject as to time of sale, location, physical characteristics, conditions of sale and other differences. ~.. 4. Adjusts the sale or listing price of each comparable for differences between it and the subject. Adjustments are based on market extractions and/or judgement. 5. Reconciles the adjusted prices of the comparable properties into an indication of value of the property being appraised. In an effort to arrive at value indications by the Sales Comparison Approach, sales of reasonably similar properties in surrounding areas were studied. Our research included both East & West Shore municipalities. Numerous sales were studied, as well as, current listings and properties under contract. Only the most comparable sales have been selected for inclusion in this report. Verification of sales information with realtor, grantor, grantee and court house records was conducted where possible. . Each comparable property was compared to the subject property and adjustments were made for significant differences. The adjusted price of each comparable indicated a value range for the subject . _ which was then reconciled into a single value indication via the Sales Comparison Approach. Connelly Ro.d. BnmpYiDe 35 1-0313 C-2 CLAUSER REAL ESTATE APPRAISALS SALES COMPARISON APPROACH - (Cont'd) MARKET STUDY - COMPARABLE COMMERCIAL SALES The Sales Comparison Approach yields an indication of value by comparing recent sales of similar properties, and making adjustments for time, location, physical and other differences. Among the area sales reviewed were the following: Imoroved Sale 1 . . Gr.antor Jerry S. Jacobs, Fredrick R. Vaupel, Alpha Beta Industries & YCIDA Grantee Metallmprovement Company, Inc. Tax Map No. 36-000-LI-OOOIF Location Emig Road, Manchester Township, York, York County, P A . One-story metal light industrial building with 18' wall height containing 21,088 SF and attached one-story metal warehouse with 24' wall height containing 10,692 SF. Built in 1974, buildings are heated with 3600 % SF of offices that are also air conditioned. Total area of both buildings is 31,780 SF Improvements Lot Size 3.6449 acres . Land to Bldg. Ratio 5.00:1 Date Sold May, 1998 Consideration $1,240,000 Deed Book 1322, Page 4167 Price per SF Building $39.02 Verification of Sale Courthouse Records Connelly ROIId. Emmipville 36 1-0313C:Z CLAUSER REAL ESTATE APPRAISALS SALES COMPARISON APPROACH - (Cont'd) Imnroved Sale 2 Grantor GleI)Il C. Rexroth, Linda A. Rexroth, and Glenn C. Rexroth, Jr TlDfB/A GIenlyn Enterprises Grantee FABCO Enterprises, LP Tax Map No. 36-000-LI-0085A . Location IOJ Mundis Race Road, Manchester Township, York, York County, P A . , Improvements One-story metal manufacturing building containing 30,390 SF with attached one-story metal office area containing an additional 4,800 SF. Built in 1998, building has two full length craneways and is used for steel fabrication. Gross building area is 35,190 SF Lot Size 7.54 acres Land to Bldg. Ratio 9.33:1 Date Sold March 2000 Consideration . $1,996,400 Deed Book 1392, Page 1141 Price per SF Building $56.73 Verification of Sale Courthouse Records ConneDy 1lwd, IlnImipville 37 1-031JC-2 CLAUSER REAL ESTATE APPRAISALS SALES COMPARISON APPROACH - (Cont'd) Improved Sale 3 Grantor Fannbrook Business Center LLP Grantee 542 Realty Company Tax Map No. 36-000-27-0013 Location W90dbridge Circle, Manchester Township, York, York County, PA . . Improvements One-story concrete block and metal warehouse type building with 18' wall height and gross area of 32, 160 SF including 8,oonr SF of office space. Built in 1990, the offices are air conditioned and the building is designed for multi-tenant use. Lot Size 3.08 acres Land to Bldg. Ratio 4.17:1 Date Sold January, 2000 . Consideration $1,100,000 Deed Book 1389, Page 4618 Price per SF Building $34.20 Verification of Sale Courthouse Records CoaMII) RoId. I!mmipvllle 38 1..o3l3C.2 CLAUSER REAL ESTATE APPRAISALS SALES COMPARISON APPROACH - (Cont'd) ImDroved Sale 4 Grantor Carew Corp Grantee Kreutz Steam LP Tax Map No. 46-oo0-JJ-0025 . Location 3491 Industrial Highway, Springettsburgy Township, York, York County, PA Improvements One-story concrete block and metal building containing a gross area of 42,769 SF. Built in 1959, building has a 293' craneway and is considered to be in fair condition. Lot Size 6.03 acres Land to Bldg. Ratio 6.14:1 Date Stlld August 1999 Consigeration $942,295 Deed Book 1374, Page 3556 Price per SF Building $22.03 . Verification of Sale Courthouse Records Connelly R.-l,BnwnIpville 39 1-ol13C-Z CLAUSER REAL ESTATE APPRAISALS SALES COMPARISON APPROACH - (Cont'd) Improved Sale 5 Grantor Penn Appliance Distr, Inc. Grantee Fr Bobali Dr LL Tax Map No. 63-024-094 . . Location 1650 Bobali Drive, Swatara Township, Harrisburg, Dauphin County, PA Improvements One-story concrete block warehouse type building containing 37,986 SF with 22' ceiling height and 3 overhead doors. Built in 1974 building had 4,500 SF of showroom and 3,200 SF of offices. Building was gutted and interior remodeled after sale with office area increased to 13,000 SF Lot Siztl 3 acres Land tQ Bldg. Ratio 3.44:1 Date Sold April, 2000 Consideration $950,000 Deed Book 3656, Page 286 Price per SF of Bldg. $25.oI Verification of Sale Courthouse Records Connelly Road, Bnwniamlle 40 1~13C-2 CLAUSER REAL ESTATE APPRAISALS SALES COMPARISON APPROACH - (Cont'd) Improved Sale 6 Grantor James D. & Sandra K. Novinger Grantee Paclantic Properties, LLC . Tax Map No. .' . 62-022-005 Location 1213 Paxton Church Road, Susquehanna Twp., Harrisburg, Dauphin County, P A Improvements One-and two-story metal warehouse building containing a total of24,426 SF of building area. Interior has 5,586 SF of office area and 18,840 SF of warehouse space with 20'+ eave height. Built in 1981 the building has one 14' x 16' and three 8' x 8' overhead doors. ". Land Area 12.59 acres . Land to Bldg Ratio 22.45:1 Date Sold July, 1999 Consideration $1,100,000 Deed Book 3450, Page 264 Price per SF Bldg $45.03 Verification of Sale Courthouse Records Connelly Rom. IlmmipYille 41 1-G313C2 CLAUSER REAL ESTATE APPRAISALS SALES COMPARISON APPROACH - (Cont'd) Imoroved Sale 7 Grantor AMP Incolporated Grantee Mechanicsburg Land Company Tax Map No. 13 23 0549 003A Location 2500 Gettysburg Road, Lower Allen Township, Camp Hill, Cum~erland County, PA Improvements Older one-story concrete block warehouse with office building containing 48,000 SF including 3,000:t SF of offices. Building has 14' eave height and was renovated subsequent to purchase. Lot Size 8.39 acres Land to Building Ratio 7.61 .- Date Sold July, 1998 Consideration $1,380,000 Deed Book 179, Page 1100 Price per SF Building $28.75 Verification of Sale Courthouse records Connelly Ro.d,I!ImIipville 42 1~13C-2 CLAUSER REAL ESTATE APPRAISALS SALES COMPARISON APPROACH (Cont'd) SALES COMPARISON ADmSTMENT GRID Imp Price per Adjustment Percentage Adj. Price Sale # SF of Date of Location Land to Bldg. Design! Condition per SF of Bldg. Sale Bldg Ratio 'Size Utility Bldg. 1 $39.02 +5 0 -5 -5 +10 0 $40.97 2 $56.73 +2 0 -10 -5 -5 . -5 $43.68 3 $34.20 +2 0 0 -5 +5 0 $34.88 4 $22.03 +3 +5 -5 +5 +10 +10 $28.20 5 $25.01 +2 +10 0 0 +10 +20 $35.51 6. $45.03 +3 +10 -15 -10 +5 0 $41.88 7 $28.75 +5 +5 . -5 +5 +5 +20 $38.81 . EXDlilDstion of Adiustments Imp. Sale 1 has a downward adjustment for smaller building size which would normally sell at a higher price per square foot. Downward adjustment is also made for superior land to building ratio of comparable. Time since sale and inferior design/utility of comparable have upward adjustments. . Adjusted price per square foot of building including land is $40.97. Imp. Sale 2 'is given an upward adjustment for time since sale of comparable. Smaller building size and superior land to building ratio, design/utility and condition of comparable have downward adjustments. Adjusted price per square foot of building including land is $43.68. Imp. Sale 3 is inferior to subject as to design/utility and time since sale with upward adjustments needed. Downward adjustment is made for comparables smaller building size. Adjusted price per square foot of building including land is $34.88. Imp. Sale 4 is a larger building that would tend to sell at a lower price per square foot with an upward adjustment needed. Comparables inferior condition, design/utility, location and time since sale all have upward adjustments also. Superior land to building ratio has a downward adjustment. Adjusted price per square foot of building including land is $28.20. Cormdly Ro.d. Bmmipville 43 I..Q3UC-2 CLAUSER REAL ESTATE APPRAISALS SALES COMPARISON APPROACH - (Cont'd) Imp. Sale 5 has upward adjustments for comparables inferior location, design/utility, condition and time since sale. Adjusted price per square foot of bUilding including land is $35.51. Imp. Sale 6 is given downward adjustments for superior land to building ratio and smaller building size of comparable. Inferior location, design/utility and time since sale have upward adjustments. Adjusted price per square foot of building including land is $41.88. Imp. Sale 7 is superior to subject as to land to building ratio with a downward adjustment needed. Comparables inferior location, design/utility, condition, larger building size and time since sale all have upward adjustments. Adjusted price per square foot of building including land is $38.81. Sales Comparison Approach Reconciliation . Adjusted values on the above grid ranged from a low of$28.20 to a high of$43.68 per square foot of building including land. Sales I, 2 and 3 were considered to be most similar to the subject and were given greatest weight. The mean of the adjusted prices of the 'seven sales is $37.70 per square foot. The estimated price per square foot of building is in the range of $36.00 to $40.00. With greatest weight on the sales indicated, the indicated value for the subject is estimated to be $38.50 per square foot. 39,088 SF @ $38.50 per SF = $1,504,888 rounded to $1,500,000 Therefore, the value indicated by the Sales Comparison Approach as of April 27, 2001 is ONE MILLION FNE HUNDRED THOUSAND - ($1,500,000 ) - DOLLARS Connelly kC*l. Emmipvalle 44 J-0313C-2 CLAUSER REAL ESTATE APPRAISALS RECONCILIATION The indications of value as developed by the three approaches to value are as follows: Building on 3.157 acres: Value indicated by the Cost Approach Value indicated by the Income Approach Value indicated by the Sales Comparison Approach With roofrepairs completed As is $1,600,000 $1,360,000 $1,500,000 $1,255,000 . . The cost factors used in the Cost Approach have been developed from local contractors, Marshall Valuation Service, as well as, but not limited to my experience as an appraiser and realtor, which reflects the local present cost of construction. The Cost Approach generally will result in an excellent estimate of value if the building is new or reasonably new, and the improvements reflect the highest and best use of the land. However, when items ofphysica1 deterioration and obsolescence must be estimated, an area of judgement is involved which is subject to error. This approach is used in this appraisal as a guide to the final indication of value and normally reflects the upper end of the value range. Value indicated by the Cost Approach for the building on 3.157 acres is $1,600,000. /r'.' Generally, purchasers of industrial buildings are more concerned with the income the property will produce rather than its reproduction cost. There has been sufficient market data to provide reliable and factua11nformation to develop a good indication of value on the Income Approach. The ability of the property to continue to provide a reasonable return and the competitive position of this investment were considered. Most purchasers of income properties, similar to the subject, take into consideration tax shelter through depreciation seeking a long term real estate investment and/or retirement fund and do not hesitate to pay a little more for an income-producing property such as the subject property. Market study indicates purchasers of this type property are expecting a 10% return on equity with an expectation of future market appreciation. This approach indicated a value of$I,360,000. Greatest weight is given to the Sales Comparison Approach which reflects the reactions of the typical buyers and sellers in the market place. Sales of seven properties were well documented and analyzed. This approach indicated a value of$I,5oo,OOO for the building on 3.157 acres, which is in line with the Income and Cost Approaches and assumes the roof repairs "as completed". In an effort to arrive at a value prior to completion of the roof repairs, the appraiser has reviewed the Centimark re- roofing proposals and has made a $245,000 downward adjustment to the 'as completed' value and . estimated the 'as is' value of the subject property at $1,255,000. The downward adjustment assumes the upper estimate of repairs is used. Conndly R-'. EImdpviI1e 45 1..0313C2 CLAUSER REAL EST ATE APPRAISALS RECONCILIATION - (Cont'dl After careful consideration of all the factors which influence value, with greatest weight on the Sales Comparison Approach, it is my opinion that $1,500,000 reflects the market value of the property with roof repairs completed and that $1,325,000 reflects the "As Is" market value of the property prior to roof repairs. Final value estimate with roof repairs completed as of July 2,2001 is: pm: MII,.LlON FIVE HUNDRED THOUSAND... ($1,500,000) ... DOLLARS Allocated as follows: Personal Property Land Building and Improvements Total $ 0.00 235,000 1.265.000 $1,500,000 "As Is" final value estimate as of July 2, 2001 is: ~.. ONE MILLION TWO HUNDRED FIFTY -FIVE THOUSAND... ($1,255,000) ... DOLLARS Allocated as follows: Personal Property Land Building and Improvements Total . $ 0.00 235,000 1.020.000 $1,255,000 Should the property be placed for sale, the estimated marketing time is 12-24 months. No equipment or personal property is included in this valuation. Connelly RC*I. &nmipvillc 46 t..0313C.2 CLAUSER REAL ESTATE APPRAISALS CERTIFICATION AND STATEMENT OF LIMITING CONDITIONS I certlfv that. to the best of mv knowledl!e and belief: The statements of fact contained in this report are true and correct. The reported analyses. opinions. and conclusions are limited only by the reported assumptions and limiting conditions. and are my personal, unbiased professional analyses. opinions, and concJusions. I have no (or the specified) present or prospective interest in the property that is the subject of this report, and no (or the specified) personal interest with respect to the parties involved. I have no bias with respect to the property that is the subject of this report or to the parties involved in this assignment My engagement with this assignment was not contingent upon developing or reporting predetermined results. My compensation for compJeting this assignment is not contingent upon Ihc development or reporting of a predetermined value or direction in value that Cavon the cause of the client. the amount of the value opinion, the attainment of a stipulated result, or the occurrence of a subsequent event directly elated to the intended use of this appraisal. My analyses, opinions, and conclusions were developed, and this report has been prepared, in conformity with the Uniform Standards of ProfessionaJ Appraisal Practice. I have made a personal inspection of the property that:is the subject oflhis repon. Carl Anderson, my assistant, personally inspected the subject property and provided significant professional assistance to the person signing this report. CERtIFICATION: The Aoorai$eT certifies and 82ree5 that: 1. The Appraiser has no present or conternplateOfuture interest in the property appraised; and neither the employment to make the appraisal, nor the compensation for it, is contingent upon the appraised value of the property. 2. The Appraiser has no personal interest in or bias with respett to the subject matter for the appraisal report or the participants to the sale. The "Estimate of Market Value" in, the appmisal report is not based in whoJe or in part upon the race. color, or national origin afthe prospective owners or occupants of the property appraised, or upon the race, color or national origin of the present owners or occupants of the properties in the vicinity of the property appraised. 3. The Appraiser has personally inspected the property, both inside and out, and has made an exterior inspection of all comparable sales listed in the report. To the best ofthe Appraiser's knowledge and belief, all statements and infonnation in this report are true and correct, and the Appraiser bas not knowingly withheld any significant information. 4. All contingent and limiting conditions are contained herein (imposed by Ibc terms ofthc assignment or by the undersigned affecting the analysis, opinions, and conclusions contained in the report). S. This appraisal report has been made in confonnity with and is subject to the requirements of the Code of Professional Ethics and Standards of Professional Conduct of the appraisal organizations with which the Appraiser is affiliated. 6. All conclusions and opinions conc:eming the real estate that arc set forth in the appraisal report were prepared by the Appraiser whose signature appears on the appmisal report, unJess indicated as "Review Appndser". No change ahny item in the appraisal report shall be made by anyone other than the Appraiser, and the Appraiser shall have no responsibility for any such unauthorized change. CONTINGENT AND LIMmNG CONDmONS: The certification of the Appraiser appearing in the appraisal report is subject to the fonowing conditions and to such other specific and limiting conditions as arc set forth by the Appraiser in the rcport. J. The Appraiser assumes no responsibility for matters of a legal nature affecting the property appraised or the title thereto, nor does the Appraiser render any opinion as to the title, which is assumed to be good and marketable. The propcrt)' is appraised as though under responsible ownership. 2. Any sketch in the report may show approximate dimensions and is included to assist the reader visualizing the property. The Appraiser has made no survey of the property. 3. The Appraiser is not required to give testimony or appear in court bc<:ause of having made the appraisal with reference to the property in question, unless arrangements have been previously made therefor. 4. Any distnbution of the valuation in the report between land and improverncnu applies only under the existing program of utilization. The sep8nlte valuations for land and building must net be used in conjunction with any other appraisal and are invalid if so used. s. The ApPraiser assumes that there are no hidden or unapparent conditions of the property, subsoil, or structures, which would render it more or less valuable. The Appraiser assumes no responsibility for such conditions, or for engitlccrina which might be required to discover such factors. 6. Information, estimates, and opinions furnished to the Appraiser, and contained itl the RpOrt, were obtained from sources considered reliable and believed to be true and correct. However, no responsibility for accuracy of such items furnished the Appraiser can be assumed by the Appraiser. 7. Disclosure of the contents of the appraisal report is governed by the Bylaws and Regulations of the professional appraisal organizations with which the Appraiser is affiliated. 8. Neither all, nor any part of the content of the report. or copy thereof (including conclusions as to the property value, the identity of the Appraiser, professional designations, reference to any professional appraisal organizations. or the linn with which the Appraiser is connected), shaJJ be used for any purpose by anyone but the client specified in the report, the borrower if appraisal fee paid by same, the mortgages or its successors and assigns, mortgage insurers, consuJtanu, professional appraisaJ organizations, or any state or federally approved financial institution, any department. agency, or instrumentality of the United States or any state or the District of Columbia, without the previous written consent of the Appraiser; nor shall it be conveyed by anyone to the public through advertising, public relations, news, sales, or other media, without the Mitten consent and approval of the Appraiser. 9. On all appraisals, subject to satisfactory completion, repairs, or alterations, the appraisal report and value conclusion are contingent upon compJetion of the improvements in a workmanlike manner. ENVIRONMENTAL DISCLAIMER: The value estimated in this report is based on the assumption that the property is not negatively affected by the existence of hazardous substances or detrimental environmental conditions. The appraiser is not an expert in the identification of hazardous substances or detrimental environmental conditions. The appraiser's routine inspection of and inquiries about the subject property did not develop any information that indicated any apparent significant hazardous substances or detrimental environmental conditions which would affe<:t the property negatively. It is possible that tests and inspections made by a qwdified hazardous substance and environtnental expert would reveal the existence of hazardous materials and environmental conditions on or a nd the property that would negatively affect its value. Date: "7.7.-0 r '. Signature of ApP"'iser: Appraiser Signature of Assistant Assistant to Appraiser GEORGE C. USER, SRA ~~-L-- CARL s. ~SDf1;-- Dale: 1)-'(-0 J Connelly Roed. !mInil"flk 47 1-OJ13C-1 ARTICLE 9 -I-INDUSTRIAL DISTRICT Section 900. Purpose The I-Industrial District is hereby established as a District in which the regulations are intended to pennit and encourage appropriate sites to be used for industry and similar uses. Such District is further intended to encourage the harmonious and appropriate physical development of the Township by providing for graduate transitions between adjacent land uses and to consolidate locations of industrially-related land uses which, because of their shipping, storage and other requirements, exen special demands on the Township. Funher, the District is intended to contribute to the soundness of the economic base of the Township by encouraging the construction on and continued use of land for industrial purposes. The . establishment of this District is also jntended to discourage and minimize air and water pollution, noise, glare, heat, vibration, fire and safety hazards and other detriments to the enviromnent and is the only area of the Township where large tracts are easily accessible to public water and sewer. Further, this District is intended to create conditions conducive to carrying out these and the general purposes of this Ordinance. Section 901, Area of Application The following regulations shall apply to all areas designated I-Industrial District on the Zoning Map. Section 902. Use and Lot Area Requirements .. The chan, Permitted Uses and Special Exceptions. I-Industrial District, on the following page shows . permitted and special uses and the lot area requirements. Section 903. Setbacks A. Setbacks of the following minimum depths and widths shall be provided, however, in no case shall the front, side, rear yard depths be less than sixty percent (60%) of the legal right-of-way of the street or streets on which the lot abuts. 1. Front Setback (Yard) Width. thiny feet (30'); except when along major and minor anerial type roadways designated and set fonh in the Manchester Township Comprehensive Plan, when such setback shall be fifty feet (50'). 2. Side Setback (Yard) Width - thiny feet (30') each. 3. Rear Setback (Yard) Depth - thiny feet (30'). B.. Buffer yards width and/or depth shall be provided as follows: 1. When adjacent to a A, RL, RM or RH district, a buffer yard shall be provided in addition to the above yards, the depth of which shall be not less than one hundred feet (100'). All such yards shall be provided and maintained in accordance with the provisions of this Ordinance regulating buffer yards. 2. When adjacent to a pre-existing residential use existing as of the effective date of the Ordinance located within the I-Industrial District, a buffer yard shall be provided in addition to the above yards required in Section 903(A), the depth of which shall be no less than one hundred feet (100'). All such buffer yards shall be provided and maintained in accordance with the provisions of this Ordinance regulating buffer yards. 3. When adjacenlto a public street on which a Resi<lential Dislrict or pre-eltisting residential use abuts on lhe opposite side. lhe dimension of lhe righI-of-way of the public slreet shall not be considered to be a parI of the depth of the buffer yard. Section 904. Building Heigbt Limit No building shall be erected to a height in eltcess of three stories. but not eltceeding fifty feet (50') in height. The height limit for an accessory building shall be lwo (2) stories but not more than twenty-five feet (25'). Section 905. Lot Coverage Not more than sixty percent (60%) of the area of each lot shall be occupied by buildings. and no more than seventy percent (70%) of the area shall be occupie<l by impervious surface. Section 906. Open Space Thirty percent (30%) of the lot shall be vegetaged open space. All open spaces olher than off-street parking lots, loading and unloading docks, and access drives. shall be covered with a vegetative material and maintained in accordance with the lemlS of this Ordinance and any other applicable laws or ordinances. Section 807. Use and Lot Area Requirements The chart on the following page shows pennilled and special exception uses and the lot area requirements. Section 908. Prohibited Uses The following uses are expressly prohibited in the I-Industrial District. A. Residences, except dwellings only for use of bonafide caretakers or watchmen and their families or dwellings located in a mobile home park. B. All uses that do not meet the requirements of Section 1100 entitled .Performance Standards.. C. The manufacrure of rockets, projectiles, shells or other similar missiles, gunpowder, fire works; however, the manufacrure of component parts thereof which have not been assembled with all of their explosive or propellant components shall be permitted. D. The tanning or storage of rawhides or skins and fat rendering. E. Stockyards and piggeries. F. No explosives shall be stored or used at any given time on any one property unless authorized as a special exception. G. Bulk storage of oil, gasoline nor similar f1anunable liquids or gases above ground, unless authorized by Special Exceptions. 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Z w ::l! w ~ OJ CENTINI.;iiii I BXCBLLBNCB<S>SrNCB' 1968 I SHARKEIT'S PLATING COMPANY Camelly Road Emigsville, PA 17402 Attention: Tammy Highland June 15,2001 Re-roofing Proposal Main - 14,400 square feet Wide Line - 3,537 square feet CENTIMARK'S 20- YEAR WARRANTY Date: Subject: Size: At your request, we have inspected and evaluated the existing roof assembly desi8lled to protect the above refereqced areas for SHARRETT'S PLATING COMPANY. In" keeping with the criteria we have est8blished, ";e offer the following proposal for your review and consideration. SCOPE OF WORK 1. Remove existing loose gravel and dispose of properly. 2. Conduct safety brief1Dg at job site and install safety lines where needed, (See SO-I) 3. Set up warning tapes to insure set-up area is marked off and no personnel accidentally enter set-up area. This will include dumpster areas. (See SO-I) 4. Load roofing materials onto rooftop, insuring membrane rolls and all associated materials are spread out on rooftop to evenly disperse weight load. (See SO-I) , . (, S. Set up chute assembly and insure chute is secure and proper counteI'Weights are in place. (See SO-I) . , " 6. Remove existing roofing and insulation down to deck, and dispose of properly in preparation to receive new CENTIMARK Roofing System. 7. RemOve deteriorated metal decking and install new 22 gauge galvanized metal decking, the new decking is to be mechanically attached to supporting structure. (See 5D-2) 8. Remove three (3) large units from the Main Building and place on the ground (5HARRE'IT'S PLATING COMPANY is responsible for all disconnections and disposal of units). 9. Over the prepared decking install a 4 mil poly air barrier directly over decking with seams of air barrier sealed with a heavy, reinforced tape. (See SY-I) 10. Over the entire prepared substrate, we will mechanically attach a Biz" layer of a polyisocyanurate iIisulation to deck using Factory Mutual approved fasteners. This wiD provide an' R rating of , approximately 10. (See 5-1-97) 11. Over the applied insulation, we will install a 45 mil. black, EPDM membrane in accordance with CENTlMARK'S FULLY ADHEREO ROOF SYSTEM SPECIFICATIONS. (See SY-8) , 12. Clean aU seam overlaps with a primer wash and sponge to insure a clean surfilce is attained prior to application ofadhesive. (Note: Gasoline will not be used to clean seams.) {See SY-12} CENTINI.;iiii I BXCBLLBNCB <~) SINCB 1968 I SHARRETf'S PLATING COMPANY June IS, 2001 Page 2 13. All overlaps to be a minimum of 4 inches in width and sealed with an approved butyl based inseam tape. (See LS-2-97) .14. All p!lrpendicular seam overlaps (f-JOINTS) in the new roof system will be reinforced at the joints where membrane sheets intersect, with- edges detailed with a lap sealant. (See LS-4-97) IS. Apply a two-piece wrap of uncured EPDM spliced to all inside and outside comers and detailed with a lap sealant. (See C-I-97 and C-2-97) 16. Install new prefabricated pipe seal on any pipes 6" or less; S8Cllre top of pipe boot with a screw type clamp and detail with a urethane sealant. (See P-I-97 and P-2-97) 17. On all irregular pipes or stacks, install a two-piece wrap of uncured EPDM, spliced to field membrane and detailed with an edge sealant. (See P-I-97, FL-7) \. 18. RefIash all existing projections with a two-piece wrap of uncured EPDM, spliced to field membrane, < detailed with an edge sealant and terminated with an aluminum termination bar detailed with a urethane seaIant. (See P-4-97, P-5-97) 19. On wall flashings, the rubber membrane will be totally adhered to vertical surfaces and detailed with a water stop sealant on interior surface of wall flashing. On exterior surface of wall flashing, an aluminum termination bar will be fastened approximately 8 inches, on center, and detailed with a urethane sealant. (See WD-I-97 orWD-2-97) 20. All existing pitch pockets shall be cleaned and re-filled with pourable sealer. The pourable sealer will be crowned to promote water runoff. (See P-3-97) 21. Flash existing scupper boxes to new EPDM membrane using an uncured EPDM, spli<:ed to field sheet and detailed with a urethane sealant. (See D-3-97) 22. Provide tie-in from new EPDM roof to existing EPDM roof membrane, as per Ceotimark specifications. (See TI-2-97) 23. Install new 24 gauge, Kynar, painted, steel, custom metal edge to outside perimeter. (See RE-6-97 or . RE-2-97) 24. Temporary tie-ins will be made at the end of each day. (See TI-3) 25. Clean up and remove all job-related debris from the premises. 26. Perform final walk through of roof system with building representative. -' .-" CENTIM.;iiii jBXCBLLBNCB <&>SINCB 1968 I SHARRETI'S PLATING COMPANY June 15,2001 Page 3 27. Upon purchase of the roofing system, you become entitled to receive the benefits of SINGLE SOURCE RESPONSIBILITY through CENTlMARK'S non-ororated. comprehensive, total svstem written warranty. This warranty protects all components of your roof system against defects in materials and ,workmanship for a period of 20 years. If your roof leaks at any time during the warranty period, we will . provide complete warranty service. If . COST SUMMARY: Figutes quoted include all labor, materials, approprlatetaxes and insurance: INVESTMENTS MAIN BUILDING - $92,461.00 WIDE LINE BUILDING - $27,792.00 ALL ITEMS LISTED IN 1HE SCOPE OF WORK WILL BE COMPLETED BY DIRECT EMPLOYEES OF CENTIMARKCORPORATION UNDER THE SUPERVISION OF MR CHRIS GAZZIO, OUR OPERATIONS MANAGER. The Scope of Work is limited to these items specified in this proposal and does not extend to the removal of any ha2ardous containing materials. This quotation is subject to revision if the project is required to be completed by union personnel. CENTIMARK'S Standard Terms are: 1/3 of the contract price due lit the staltand 1IIe balance due net 10 days upon 1IIe job completion. Our prices do not reflect state and local permit costs. This quote does not include the disposal, recharging, connecting, disconnecting, lifting and/or freon recovery of rooftop units and equipment. Owner is responsible to protect power lines within a 10 foot radius of work to be performed in accordance with OSHA 29 CFR 1926.416. More specifically, paragraph 29 CPR 1926.416(g)(2) requires that such lines must be: I) de-energized and grounded, or 2) guarded, isolated or insulated to prevent accidental contact with lines by a body part, materials, tools or equipment. The CENTIMARK Roof System and service commitment are the best roofing investments available today. A roof system and warranty are only as good as those installing and backing them. With THIRTY-TWO YEARS of proven performance, we have developed the personnel and service record to stand as NUMBER ONE in our field. We want to thank you for your interest in CENTIMARK CORPORATION and for the cou~ extended to all its employees. . Sincerely, Mike Dolci Project Manager '-, CENT'IIII.;iiii I EXCBLLBNCB <S>SINCB:l968 I SHARRETI'S PLATING COMfANY Connelly Road Emigsville, PA 174()2 Oate: Subject: Size: June IS, 2001 Tuffipan Re-roofing Proposal Main - 14,400 square feet Wide Line - 3,S37 square feet Attention: Tammy Highland CENTIMARK'S 20- YEAR WARRANTY At. yeur request, we have inspected and evaluated the existing roof assembly designed to protect the above referenced areas for SHARRETI'S PLATING COMPANY. In keeping with the criteria we have established, we offer the following proposal for your review and consideration. SCOPE OF WORK 1. Remove existing loose gravel and dispose of properly. 2. Conduct safety briefing at job site and install safety lines where needed. (See SO-I) 3. Set up warning tapes to insure set-up area is marked off and no personnel accidentally enter set-up area. This will include dumpster areas. (See SO-I) ,- 4. Load roofing materials onto rooftop, insuring membrane rolls and all associated materials are spread out -j on rooftop to evenly disperse weight load. (See SO-I) S. Set up chute assembly and insul'll chute is secure and proper coUnterweights are in place. (See SO-I) 6. Remove existing roofing and insulation down to deck, and dispose of properly in preparation to receive new CENTIMARK Roofing S~. 7. Remove deteriorated metal decking and install new Tuffspan decking, the new decking is to be mechanically attached to supporting structure. (See SO-2) 8. Remove three (3) large units from the Main Building and place on the ground (SHARRE'IT'S PLATING COMPANY is responsible for all disconnections and disposal of units). 9. Over the entire prepared substrate, we will mechanically attach a 1I1z" layer of a polyisocyanurate insulation to deck using stainless steel Tuffspan approved filsteners. This will provide an R rating of approximately 10. (See S-I-97) 10. Over the applied insulation, we will install a 4S mil. black, EPOM membrane in accordance with CENT1MARK'S FULLY ADHEREO ROOF SYSTEM SPECIFICATIONS. (See SY-8) 11. Clean all seam overlaps with a primer wash and sponge to insure a clean surfilce is attained prior to application ofadhesive. (Note: Gasoline will not be used to clean seams.) {See SY-I2} 12. All overlaps to be a minimum of 4 inches in width and sealed with an approved butyl based inseam tape. (See LS-2-97) . . . CENTINI..;iiii IB.rCBLLBNCB",~t) ,"SINCB..1968.1 SHARRE'lT'S PLATING COMPANY 1une 15,2001 Page 2 13. All perpendicular seam overlaps (T-IOINTS) in the new roof system will be reinforced at the joints where membrane sheets intersect, with edges detailed with a lap sealant. (See LS-4-97) 14. Apply a two-piece wrap of tnIcured EPDM spliced to all inside and outside comers and detailed with a lap sealant. (See C-I-97 and C-2-97) I IS. Install new prembricated pipe seal on any'pipes 6" or less; secure top of pipe boot with a screw type clamp and detail with a urethane sealant. (See P-I-97 and P-2-97) 16. On all irregular pipes or stacks, install a two-piece wrap of tnIcured EPDM, spliced to field membrane and detailed with an edge sealant. (See P-I-97, FL-7) 17. RefIash all existing projections with a two-piece wrap of tnIcured EPDM, spliced to field membrane, detailed with an edge sealant and terminated with an aluminum termination bar detailed with a urethane sealant. (See P-4-97, P-S-97) ------ 18. On wall flashings, the rubber membrane will be totally adhered to vertical surfaces and detailed with a water stop sealant on interior surface of wall flashing. On exterior surface of wall flashing, an aluminum termination'bar will be mstened approximately 8 inches, on center, and detailed with a urethane sealant. (See WD-I-97 or WD-2-97) , 19. All existing pitch pockets shall be cleaned and re-filled with pourable sealer. The pourable sealer will be crowned to promote water runoff. (See P-3-97) 20. Flash existing scupper boxes to new EPDM membrane using an uncured EPDM, spliced to field sheet and detailed with a urethane sealant. (See D-3-97) 21. Provide tie-in from new EPDM roof to existing EPDM roof membrane, as per Centimark specifications. (See TI-2-97) 22. Install new 24 gauge, Kynar, painted, steel, custom metal edge to outside perimeter. (See RE-6-97 or RE-2-97) 23, Temporary tie-ins will be made at the end of each day. (See TI-3) 24. Clean up and rel!1ove all job-related debris from the premises. 25. Perform final walk through ofrbofsystem with building representative. i"~ , CENT'NlA;iiii I 'BXCBLLBNCB <>SINCB.1968.! SHARRE'lT'S PLATING COMPANY June IS, 2001 Page 3 26. Upon purchase of the roofing system, you beCome entitled to receive the benefits of SINGLE SOURCE RESPONSmlLITY through CENTIMARK'S non-ororated. comprehensive, total system written warranty. This warranty protects all components of your roof system against defects in materials and .. workmanship for a period of 20 years. If your roof leaks at any time during the warranty period, we will . . provic!e complete warranty service. COST SUMMARY: Figures qiJoted include all labor, materials, appropriate taxes and insurance: INVESTMENTS MAIN BUILDING - $192,600.00 WIDE LINE BUILDING - $52,400,00 ALL ITEMS LISTED IN THE SCOPE OF WORK WILL BE COMPLETED BY DIRECT EMPLOYEES OF CENTIMARK CORPORATION UNDER THE SUPERVISION OF MR. CHRIS GAZZIO, OUR OPERATIONS MANAGER. The ,Scope of Work is limited to these items specified in this proposal and does not extend to thl' .removal of any hazardous containing materials. This quotation is s~bjeCt to revision if the project is required to be completed by union personnel. .. CENTIMARK'S Standard Terms are: 1/3 of the contract price due at the start and the balance due net 10 days upon the job completion. Our priCes do not reflect state and local permit costs. This quote does not include the disposal, recharging, connecting, disconnecting, lifting and/or freon recovery of rooftop units and equipment. Owner is responsible to protect power lines within a 10 foot radius of work to be performed in accordance with OSHA 29 CFR 1926.416. More specifically, paragraph 29 CFR 1926.416(g)(2) requires that such lines must be: I) de-energized and grounded, or 2) guarded, isolated or insulated to prevent accidental contact with lines by a body part, materials, tools or equipment. The CENTIMARK Roof System and service commitment are the best roofing investments available today. A roof system and warranty are only as good as those installing and backing them. With THIRTY-TWO YEARS of proven performance, we have developed the personnel and service record to stand as NUMBER ONE in our field. We want to thank you for your interest in CENTIMARK CORPORATION and for the court~ extended to an its employees. Sincerely, Mike Dolci Project Manager ~:~-~ e:= -- C) Date: tD C'~j c.') I C'_ L'..J 0-) l.:"""" (":~ ,~ c:-..:> C'J Register of Wills of Cumberland County STATUS REPORT UNDER RULE 6.12 Name of Decedent: 1. Paul Sharretts Date of Death: 7/4/2001 Estate No.: 21-01-00699 Pursuant to Rule 6.12 of the Supreme Court Orphans' Court Rules, I report the following with respect to completion of the administration of the above-captioned estate: 1. State whether administration of the estate is complete: Yes./Xl No 0 2. If the answer is No, state when the personal representative reasonably believes that the administration will be complete: 3. If the answer to No. 1 is Yes, state the following: a. Did the personal representative file a final account with the Court? Yes 0 No ~ b. The separate Orphans' Court No. (if any) for the personal representative's account is: c. Did the personal representative state an account informally to the parties in interest? Yes Jgl No 0 c. Copies of receipts, releases, joinders and approval of formal or informal accounts may be filed with the Clerk of the Orphans' Court and may be attached to this report. j ((7 / ()~~ (~)('~Q - litA- ( Sigu-ature David A. Wion. ESQuire Name 109 Locust Street Harrts-b'ltl"Tg. PA 17101 Address 717-236-9301 Telephone No. c. Capacity: 0 Personal Representative ~ Counsel for personal representative Q;~