=c. Now let's try a different terminal value. Estimate the fair market value of Torino Marine's equity per share at the end of 2006 under the following assumptions:

(1) Free cash flows in years 2007 through 2010 remain as above.

(2) EBIT after year 2010 grows at 4 percent per year forever.

(3) To support the perpetual growth in EBIT, capital expenditures in year 2011 exceed depreciation by $20 million, and this difference grows 4 percent per year forever.

(4) Similarly, working capital investments are $10 million in 2011, and this amount grows 4 percent per year forever.