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STARS0029728

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STARS0029729

Recent IRS Activity / Proposals

myCFO’s Plan

Short-Term Revenue Impact and Q2 STARs Pipeline

Issues- client and myCFO¯ Audit / Penalty¯ Liability¯ PR Impact

Long-Term Strategy and Opportunities¯ STARs¯ myCFO’s Platform and Alliance strategies

Strategic Alternatives

myCFO, Inc. -- Highly Confidential

STARS0029730

IRS Action Specifics myCFO/Legal View

CARDs Notice(issued 3/18/02)

Disclosure Program(filing due 4/23/02)

NPL

no change in law"listed" transaction

¯ no retroactive affecttax treatment questioned

¯ increased focus on penaltiesfor understatement / non-listing

¯ heightened audit risk¯ no clear extension to

individualseliminates penaltyassures IRS audit

¯ accel, tax positionreview/negotiation

significant document disclosure¯ A/C privilege waiver

(scope unclear)

no IRS action/change in law¯ possible future listing /

registration under IRSproposals (see next page)

myCFO, Inc. -- Highly Confidential

strong !egal/economicsupport

¯ clients can rely on originalopinions

¯ low client penalty exposure¯ low myCFO penalty exposure

no new CARDS transactions

disclosure recommended forCARDs clients

¯ 3rd partvdisclosure likely leadto myCFO CARDs clients

¯ audit risk increasedmyCFO to assist

¯consistent disclosures¯conflict waiver requested

NPL still strong / viable¯ no clear benefit from IRS

Disclosure Program

STARS0029731

Proposal Specifics myCFO/Legal ViewTransparency

DisclosureRequirements

Reportable Transactions

Strict Liability

increases taxpayerdisclosure

¯ "who participates"¯ "what transactions"

higher penalties

expands corporate disclosurerules

¯ individuals, trusts, S-corpsand partnerships mustdisclose

expands entities required toreport/list/register transaction

¯ transaction $$ / fee test¯ myCFO required to list

eliminates legal opinions aspenalty "safe harbor"

¯ transactions must stand onbusiness purpose / tax law

myCFO, Inc. -- Highly Confidential

many proposals requireCongressional action

¯ extend regs to individuals¯ increase penalties

uncertain legislative timelineand outcome

¯ no current schedule¯ competing Committee bills

IRS can make unilateralchanges immediately

¯ expand certain reporting,disclosure and listingrequirements

¯ strict liability (unclearability to impose w/oCongress)

significant short-termuncertainty; less long-termimpact

¯ STARs reviewing newofferings not contemplatedby current IRS proposals

STARS0029732

Keep clients informed of events / options¯ Availability of IRS disclosure program

¯ myCFO recommending for CARDsincreased audit risk; increased IRS scrutinycertain penalty avoidance

¯ not recommending for NPL or other transactions- no actual change in law- still viable tax solutions- no increased audit risk- strong economic and legal support; likely penalty avoidance

Address short-term impact on STARs¯ Hit Q2 revenue (shift from Q1 to Q2)

¯ new MD (Randy Bickham) provides potential for short-term revenue pick ¯ current Pipeline of $11M by end of Q2¯ national Alliance w/Greenberg is significant in the current pipeline¯ incentives aligned to meet plan; get Q2 cash and hit firm plan!

¯ Liquidity will be critical issue if transactions close beyond April

Address long-term impact on STARs/myCFO¯ myCFO uniquely positioned for "next generation"¯ shift from third-party tax products to investment products (Transactional to Annuity)¯ myCFO platform & Alliance strategy as significant market opportunities

myCFO, Inc. -- Highly Confidential 5

STARS0029733

FOSIAS

STARS

Q1 Revemue

I Estimated I I Plan I I Over / (Under) I %Diff.5,336 5,170 166 3%1,845 2,767 (922) -33%

491 1,760 (1,269) -72%

I 7,67311 9,69711 (2,024)1 I -21% I

Beginning Cash Balance

14/01-4/15J 14/15-4/30J 15/01-5/151 15/15-5/311 J6/01-6/151 J6/15-6/30J

17500 351 527 1 ~459 2~564 11155

Cash CollectionsFOS 750 750 750 750 750 750IAS - 825 325 400 100 75STARS (Pipeline) 200 831 2,117 2,000 - 5,000

Total Cash Collections

Cash after Collections

Total Cash Payments

Ending Cash Available

Ending Cash W/O STARs

TOTAL

1,500

4,5001,725

10,147

950 2,406 3,192 3,150 850 5,825 17,872

2,450 2,757 3,718 4,609 3,414 6,980

(2,099) (2,230) (2,259) (2,045) (2,259) (1,965)

351 527 1,459 2,564 1,155 5,015

I 151 (504) (1,688) (2,583) (3,992) (5,132)I

(12,857

5,015

myCFO, Inc. -- Highly Confidential

STARS0029734

myCFO Strategic Advisory Services (STARS) - 2002 Pipeline Report

Client IOfficel CSDTrade Size Client’s myCFO Quarterly Revenue I CashNotional Gross Fee Attorneys Fee Act. Q1 411-4/15 ~15~/30 5/1-5/15 5/15-531 611-6115 6115-6130 Total Q2

Signed and Closed Projects

1 Klein LA Nodon $50,000 $0 $50,000 $50,00O2 Elins LA Anderson $25,000, $0 $25,000 $25,000

Signed andWIP Projects

3 Kraft OC Harper $125,0001 $o $125,000’$125,000 $C4 Aslanian LA Anderson $200,000 $o $200,000! $0 $200,000 $200,000

Pipeline - Greater than 75%

5 Douglas OC Sacaccio $5,000,000 $125,000 $o $125,000 $125,000 $125,00C6 Kalikow STARS Groves $21,300,000 $745,500’ ($4o,ooo) $705,500 $705,500 $705,5007 SilvermanSTARS Groves $21,300,000 $745,500 ($40,000) $705,500 $705,500 $705,50O8 Kramer STARS Schaller $21,300,000 $745,500 ($40,000) $705,50O $705,500 $705,5009 Woodner STARS Groves $21,300,000 $745,500 ($40,000) $705,500 $7O5,5OO $705,50C

10 Client 1 STARS Bickham $500,000,000 $5,00O,000 $o $5,000,00O $5,000,000 $5,000,00O11 Client 2 STARS Bickham $100,000,000 $2,000,000 $0 $2,000,000 $2,000,000 $2,000,00O

Totals $690,200,000$10,507,000 ($160,000) $10,347,000$200,000 $200,000 $830,500 $2,116,500 $2,000,000 $0 $5,000,000 $10,147,00(]

myCFO, Inc. -- Highly Confidential 7

STARS0029735

EventsDisclosure Program, CARDs Pre-Events Post-Events

Notice & IRS ProposalsClient Audit "Lottery" Increased (for CARDs)

Tax Law Strong basis and tax Strong basis and tax lawlaw opinions opinions

Penalty Unlikely Unlikely (for CARDs) / uncertain(for NPL & going forward)

myCFO Liability risk (from client) Low Uncertain

Penalty risk Low Low

CSD support Active Uncertain

Cash flow Substantial Short-term:cautious / unpredictableLong-term: substantial

myCFO, Inc. -- Highly Confidential

STARS0029736

Clients¯ increased IRS scrutiny for CARDs (Notice 2002-21)

¯ high audit/medium PR risk

¯ little change for NPL, other transactions¯ normal audit/low PR risk

¯ general confusion /"chill" factor

Company¯ "myCFO" will be disclosed during Disclosure Program¯ likely IRS summons (3-12 mos.)

¯ client names / materials

¯ risk of expanding IRS inquiry (beyond CARDs)¯ possible IRS target (big name / small company)¯ high PR risk

Board¯ PR risk¯ low liability risk

myCFO, Inc. -- Highly Confidential

STARS0029737

Historical focus on identifying third-party, loss-generating tax strategies

¯ most revenue recognized in the 4th quarter

New focus on investment-centric strategies with 2+ year holds

¯ wrap investment programs with embedded tax efficiencies¯ financial derivative monetization strategies for unrecognized tax gains¯ distressed asset partnership strategies for recognized gains¯ transition from FOS to IAS platform - 12 month goal

~Jpfront design and implementation (transaction fees) and managementannuity fees-)

¯ annuity-based revenue not subject to changes in tax shelter/listing requirements¯ inherently less financial risk¯ diversify distribution to 66%+ of deals sourced from outside current client base (e.g., I-Banks)

From tax-specific solutions to long-term wealth advice

Key new hire extensive experience, network and technical skills

¯ excellent compliment to Alliance strategy for asset management at $100M+ level¯ "blueprints" to imbedded tax planning for high-margin annuity revenue

myCFO, Inc. -- Highly Confidential 10

STARS0029738

Long=TermGro~~’th Strategy

Phase 1

Tax/Estates[] High Client

satisfaction[] 90-100% Influence[] Nationwide

Coverage

i lnvestment Advisory Services(IAS) -~ Fully Scalable Investment~..:~ .:-. Platform from HNW.to .~

: Broad Market products

SYARS t

4,AHiance / AppHcatio~ Service

PltOvidelr {ASP} - 3rd party platformdistribution model for technology

applications, FOS and IAS

Phase 2 Phase 3 Phase 4

to Alliances" Alignment

Platform

o Fund of Funds[] Lending[] Cash[] STARs[] Technology

Extended platform throughexternal professionals

[] Independent financialadvisorsLaw firms

o Tax firms

Extended platform

[] Cash management[] Retirement plans

myCFO, Inc. -- Highly Confidential 11

STARS0029739

Go Forward Short-term Sell

Pursue a dual growth strategy¯ build investment platform & next generation

STARs¯ leverage to Alliances

May need cash as soon as April (-$.5M)Alliance as future

Pursue strategic partner¯ move forward current discussions¯ identify alternative interested partners

May still need short-term liquidityAlliance will not happen

RecommendationGo forward; Review in 45 Days

Continue Discussions w/strategic partners

Monitor cash / need for quick infusion

myCFO, Inc. -- Highly Confidential 12

STARS0029740