V.R. DeAngelis M.D.P.C. & R.T. Domingo M.D.P.C., V. R. DeAngelis M.D.P.C., Tax Matters Partner, et al. - Page 43




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          XI.  Survivor Whole Life Policies                                           
               A.  Domingos Survivor Whole Life Policy                                
               On December 10, 2001, STEP assigned the ownership of the               
          Domingos survivor whole life policy to Dr. Domingo.  As of                  
          December 28, 2001, the Domingos survivor whole life policy had a            
          total death benefit of $596,009.81, less an outstanding policy              
          loan of $220,206.85, for a net death benefit of $375,802.96.  As            
          of the same date, the Domingos survivor whole life policy had a             
          cash surrender value of $224,475.17, less the outstanding policy            
          loan of $220,206.85, for a net cash surrender value of $4,268.32.           
          As of November 2006, the Domingos survivor whole life policy had            
          a cash value base of $277,316.37, a cash value of additional                
          insurance of $21,380.58, an existing loan of $279,056.26, and               
          loan interest due of $13,793.75, for a net cash surrender value             
          of $5,846.94.  From December 28, 1993, through the present, the             
          Domingos received life insurance coverage of between $511,542 and           
          $3,500,000 through the Domingos survivor whole life policy.                 
               B.  DeAngelises Survivor Whole Life Policy                             
               On July 28, 2003, STEP assigned the ownership of the                   
          DeAngelises survivor whole life policy to the DeAngelises.  No              
          severance event had occurred under the STEP plan to permit this             
          assignment.  In connection with the assignment, Dr. DeAngelis               
          also executed a claim settlement and release form backdated to              
          January 3, 2003.                                                            







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