PK Ventures, Inc. and Subsidiaries, et al. - Page 145

                                       - 90 -                                         
                             Income (Loss)   Cancellation of                          
                       Year   from PKVI LP Indebtedness Income                        
                       1990        –-               –-                                
                       1991   ($654,236)        $1,061,372                            
                       1992 (1,008,745)             -–                                
                       1993    (689,766)            --                                
                       1994    (373,590)            --                                
                       1995    (679,795)            -–                                
               The Roses attached the following statement, in pertinent               
          part, to their joint income tax return for 1990:                            
               The above mentioned taxpayers have elected to                          
               carryforward the net operating lossess [sic] of the                    
               following companies for the tax period ending 12/31/90:                
                         *    *    *    *    *    *    *                              
               2.   PK Ventures I Limited Partnership, (1990) the                     
                    aggregate amount of $422,629, which appears on the                
                    taxpayer’s Schedule K-1 (Form 1065) line 1, * * *                 
                         *    *    *    *    *    *    *                              
               In addition, unused outstanding amounts have been                      
               carried forward:  * * * PK Ventures I Limited                          
               Partnership (1988) of $103,820 * * * and                               
               PK Ventures I Limited Partnership (1989) of $318,768.                  
          This statement was signed by the Roses and dated October 12,                
          1991.  In sum, the Roses carried forward losses from PKVI LP                
          totaling $845,217.                                                          
               The Roses attached the following statement, in pertinent               
          part, to their joint income tax return for 1991:                            
               The above mentioned taxpayers have elected to                          
               carryforward the net operating lossess [sic] of the                    
               following companies for the tax period ending 12/31/91:                
               1.   The amount of $318,768 of unapplied net operating                 
                    loss from PK Ventures I LP (1989) * * * was                       
                    carried forward to 1991.  Of this amount, $127,452                





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