TI=\INTRODUCTION AND LEGAL & CRIMINAL ALLEGATIONSDA= MARCH 4, 1991AT= AUDIO TRACKS: /ALL

SU= SUMMARY: THE FOLLOWING LEGAL TORTS WERE COMMITED AGAINST STAN J. CATERBONE BETWEEN JUNE 23, 1987 AND JULY OF 1988.

CONSPIRACY FRAUD WILLFUL MISCONDUCT FALSE ARREST FALSE IMPRISONMENT DEFAMATION OF CHARACTER SLANDER MALICE UNFAIR COMPETITION WRONGFUL INTERFERENCE WITH BUSINESS RELATIONS WRONGFUL INTERFERENCE WITH BUSINESS CONTRACTS TRESFASS TO PERSON BURGLARY THEFT INVASION OF PRIVACY UNDOINFLUENCE ILLEGAL REPOSESSION BREACH OF CONTRACT FORGERY SHAREHOLDER FREEZEOUT NEGLIGENCE

IN JUNE OF 1987, STANLEY J. CATERBONE WAS THE FOUNDER, EXECUTIVE VICE PRESIDENT, INCORPORATOR, AND SECRETARY OF FINANCIAL MANAGMENT GROUP, Ltd.,; PRESIDENT AND INCORPORATOR OF FMG ADVISORY; PRESIDENT, OWNER, AND INCORPORATOR OF PRO FINANCIAL GROUP, Ltd.,; GENERAL PARTNER OF POWER PRODUCTIONS I, ALL OPERATING AT 1755 OREGON PIKE, LANCASTER, PENNSYLVANIA, AS INDIVIDUAL LEASEHOLDER WITH A PERSONAL GUARUNTEE FOR A TERM OF FIVE YEARS, OR UNTIL AUGUST OF 1991.

WITHOUT ANY LEGAL OR OTHER JUSTIFICATION, STAN J. CATERBONE HAD LOST ALL RIGHTS AS AN OFFICER, SHAREHOLDER, CITIZEN, AND HUMAN BEING; ALL RIGHTS TO PRODUCE INCOME; ALL PERSONAL AND BUSINESS ASSETS; AND MOST IMPORTANLTY HIS REPUTATION AND CREDITWORTHINESS AT WHICH TIME WAS EXCELLENT IN BOTH REGARDS, THAT WAS THE RESULT OF A MYRIAD OF CRIMITAL AND ILLEGAL ACTIVITES OF THOSE IMPLICATED, AS DESCRIBED HEREIN.

THERE WERE MANY MOTIVES AND COLLABORATIONS FOR THE EVENTS AND ACTIVITIES THAT ARE PRESENTED IN THIS DOCUMENTATION. HOWEVER, THERE IS ONE UNDERLYING CURRENT THAT WILL BE PROVEN TO HAVE PROVIDED THE POLITICAL AND LEGAL ENVIRONMENT THAT COULD HAVE ALLOWED SUCH A HORRID VIOLATION OF ANY PERSONS RIGHTS ------ JAMES GUERIN AND THE ISC SCANDEL.

IN JUNE OF 1987, STAN CATERBONE PUBLICALLY MADE ALLEGATIONS OF MISCONDUCT AND IMPROPRIETIES OF THE BUSINESS ACTIVITIES OF JAMES GUERIN AND ISC. MORE IMPORTANTLY, STAN J. CATERBONE MADE THESE ALLEGATIONS TO LARRY RESCH, AN ISC EXECUTIVE THAT CAME TO FINANCIAL MANAGEMENT GROUP, Ltd., ON JUNE 23, 1987 TO VISIT HIM. MOREOVER, THESE ALLEGATIONS WERE MADE AS A SHAREHOLDER OF ISC. CONSEQUENTLY, AS ACCURATE AS THE ALLEGATIONS WERE,

THEY WERE SOME 2 YEARS AHEAD OF THE CURRENT FEDERAL INVESTIGATIONS.

MANY OF THE PEOPLE AND BUSINESSES THAT ARE INVOLVED IN THE ACTIVITIES DESCRIBED HERIN, CAN BE TRACED TO RELATIONSHIPS WITH JAMES GUERIN AND ISC.

HOWEVER, THIS CASE WOULD BE TO SIMPLE IF IT WERE TO ONLY CONTAIN THE ISSUES OF THE ISC SCANDEL. THERE WERE OTHER PERSONS AND OR BUSINESESS THAT HAD THERE OWN MOTIVES AND INTERESTS IN REDUCING STAN J. CATERBONE TO NOTHING, INCLUDING HIS FINANCIAL STATUS, REPUTATION, CREDITWORTHINESS, SOCIAL STATUS, AND HIS EXISTENCE.

THE BANKS. WHEN STAN J. CATERBONE BEGAN TO DESIGN HIS CONCEPT OF FINANCIAL MANAGEMENT GROUP, Ltd,. IN 1986, HE HAD MUCH VISIBIILITY AND MANY CONTACTS OF THE LOCAL BANKING COMMUNITY AT LARGE THAT WAS A RESULT OF HIS EFFORTS AND ENERGIES IN BUILDING THE PENNSYLVANIA CHAPTER OF THE INTERNATIONAL ASSOCIATION OF FINANCIAL PLANNERS (IAFP). WITH PRESIDENT JOHN HERR, STAN CATERBONE WAS INSTRUMENTAL IN DEVELOPING THE ORGANIZATION. THE CHAPTER WAS DEVLOPED IN ORDER TO PROVIDE A LOCAL ALTERNATIVE TO THE PHILADELPHIA AND STATE COLLEGE CHAPTERS. EVEN BACK THEN, THE BANKS WERE SKEPTICAL OF STAN CATERBONE'S ABILITY TO DEVELOPE A FINANCIAL FIRM THAT WOULD INCLUDE MYRIAD OF PRODUCTS AND SERVICES, REAL ESTATE, INSURANCE, PORTFOLIO MANAGEMENT, TAX SERVICES, MUTUAL FUNDS, MORTGAGE BANKING, INVESTMENT BANKING, AND FINANCIAL PLANNING.

HOWEVER, ONE LOCAL BANK, BLUE BALL BANK, DID INVITE STAN CATERBONE TO DISCUSS BUILDING SUCH AN ORGANIZATION WITHIN THE BANKS INFRUSTRUCTURE. ALTHOUGH THEY WERE QUICK TO CHALLENGE HIS MISSION, THEY WERE AT THE SAME TIME ENVIOUS THAT STAN CATERBONE DID NOT HAVE THE REGULATORY RESTRICTIONS THAT THEY DID IN CONSIDERING SUCH A MISSION. THIS, OF COURSE, LEFT THE BANKS LIMITED IN THIER ABILITY TO COMPETE ONE ON ONE WITH FINANCIAL MANAGEMENT GROUP, Ltd.,.

THIS SITUATION BECAME EVEN MORE DAMAGING WHEN CUSTOMERS OF THE BANKS WOULD TRANSFER ASSETS TO FINANCIAL MANAGEMENT GROUP, Ltd.,. AND THIS WAS A FREQUENT OCCURENCE. THERE WERE EVEN MANY ATTEMPTS TO DEVELOP BUSINESS RELATIONSHIPS, WHICH WOULD HAVE BEEN MUTUALLY PROFITABLE. HOWEVER THE EFFORTS PROVED FRUTLESS.

THE FINAL CONFLICT BEGAN WHEN STAN CATERBONE DEVELOPED A POWERFUL AND INFLUENTIAL MORGTGAGE BANKING OPERATION. STAN J. CATERBONE WAS SOLICITED BY INSTITUTIONAL INVESTORS OF HOUSTON, TEXAS, TO BUILD A PORTFOLIO OF REAL ESTATE ASSETS FROM THE EAST COAST. THE EXISTING PORTFOLIO WAS HEAVLIY INVESTED IN THE SOUTHEASTERN MARKETS, WHICH WERE EXPERIENCING EXTREME VOLITILITY AND RISK. BY DIVERSIFYING TO THE EAST COAST, THE PORTFOLIO WOULD IMMEDIATELY APPRECIATE.

STAN CATERBONE WAS GIVEN THE FINANCIAL RESOURCES TO OFFER FINANCING FOR PROJECTS RANGING IN SIZE OF $3 TO $100 MILLION DOLLARS. THIS CAPABILITY FAR EXCEEDED ANY LOCAL FINANCIAL INSTITUTION. THIS WAS DOCUMENTED IN JUNE OF 1987. STAN CATERBONE HAD SECRED FINANCING FOR NORIS BOYD, OF BOYD WILSON COMPANY, FOR THE OLDE HICKORY INN. THE TERMS WERE A FIVE YEAR TERM OF 9.5% FOR $5,000,000. COMMONWEALTH BANK HELD THE EXISTING MORTGAGE THAT WOULD BE REPLACED SHOULD BOYD WILSON ACCEPT THE OFFER. THE COMMONWEALTH NATIONAL BANK COULD NOT COMPETE. IRONICALLY, THE COMMONWEALTH NATIONAL BANK ILLEGALY REPOSSESED THE AIRCRAFT OF STAN CATERBONE 23 DAYS BEFORE ANY PAYMENT DUE.

FARMERS FIRST BANK HAD REFUSED TO DISCLOSE FINANCIAL INFORMATION AND RECORDS OF FINANCIAL MANAGEMENT GROUP, Ltd., THAT WERE INITIALLY OPENED BY STAN CATERBONE, AND WHICH HE MANAGED, ADMINISTERED, AND HAD UNLIMITED AUTHORITY AND JURISDICTION. THE FARMERS FIRST BANK ALSO ATTEMPTED TO STEAL A CHECK THAT WAS PRESENTED FOR CASHING AT THE PARK CITY BRANCE, IN OCTOBER OF 1987. THE CHECK WAS DRAWN AGAINST FINANCIAL SECURITIES CORP. OR FSC. THE BANK TELLER NOT ONLY REFUSED TO CASH THE CHECK, BUT REFUSED TO RETURN THE CHECH TO STAN CATERBONE. AFTER SPEAKING LOUDLY IN ORDER TO ATTRACT ATTENTION FROM OTHER PEOPLE IN THE BANK, THE TELLER FINALLY DID RETURNT THE CHECK.

ON JULY 2, OF 1987, A CHECK WAS MADE PAYABLE TO ROMAR AVIATION OF LANCASTER BY STAN CATERBONE. FULTON BANK HAD DISCLOSED TO CHUCK SMITH OF LANCASTER AVIATION THAT THERE WERE INSUFFICIENT FUNDS. CONSEQUENTLY, LANCASTER AVIATION AND COMMONWEALTH BANK REPOSESSED THE AIRCRAFT ON GROUNDS THAT STAN CATERBONE WAS NOT PROPERLY INSURED. THAT CHECK THAT WAS DRAWN AGAINST FULTON BANK WAS FOR INSURANCE. THE CHECK WAS PAID AND STAN CATERBONE CASH ASSETS AT FULTON BANK THAT WERE IN EXCESS OF ALL CURRENT DEMANDS.

MY PARTNERS. DURING THE HISTORY OF FINANCIAL MANAGEMENT GROUP, Ltd., MY PARTNERS WERE IN CONSTANT PURSUIT OF MY POWER AND MY RELATIONSHIPS. HOWEVER, I UNDERESTIMATED THE DEGREE OF MALICE AND STUPIDITY THAT THEY WOULD EVENTUALLY EMPLOY TO ACCOMPLISH THIS MISSION. HOWEVER, ABOVE AND BEYOND THAT, I UNFORTUNATELY RELIED UPON MY EXPERT KNOWLEDGE OF SECURITIES LAWS AND REGULATIONS TO PROTECT MY INTERESTS AND MY INVESTMENT. THE BURGLARY OF JUNE 25, 1987 OF THE OFFICE OF STAN CATERBONE, WAS THE EVENT THAT STARTED THE WAR. ON THAT DAY, EXECUTIEVE OF FINANCIAL MANAGEMENT GROUP Ltd., HAD GAINED ASSESS STAN CATERBONE'S OFFICE ONLY 2 DAYS AFTER THE LOCKS HAD BEEN CHANGED. BUSINESS, FINANCIAL, CORPORATE, AND LEGAL FILES WERE REMOVED. ON JUNE 29, 1987, STAN CATERBONE WAS IN HIS OFFICE AT STONE HARBOR, NEEW JERSEY. ROBERT KAUFFMAN HAD DISCLOSED THAT STOCK CERTIFICATES WERE ISSUED ON JUNE 25, 1987. STAN CATERBONE DID NOT EXPOSE HIS ANGER, AND THE SUBJECT WAS DROPPED.

HOWEVER, STAN CATERBONE HAD COMPLETE JURISDICTION AND ADMINISTRATION OF ALL CORPORATE BUSINESS AS SECRETARY OF FINANACIAL MANAGEMENT GROUP, Ltd.,. ALL RECORDS AND FILES THAT WERE REQUIRED TO ISSUE STOCK WAS IN THE LOCKED OFFICE OF STAN CATERBONE. EVEN MORE IMPORTANTLY, NO CORPORATE BUSINESS IS LEGAL OR VALID UNLESS SIGNED BY THE SECRETARY, STAN J. CATERBONE.

IT WAS THIS ACTIVITEY THAT GAVE STAN CATERBONE THE AUTHORITY, POWER, AND FIDUCIARY RESPONSIBILITY TO REMOVE ALL CORPORATE FILES AND DOCUMENTS OF FINANCIAL MANAGEMENT GROUP, Ltd., AND FMG ADVISORY, INC., THAT WERE WELL WITHIN THE RULES, LAWS, AND REGULATIONS OF PENNSYLVANIA SECURITIES COMMISSION. THE CAPACITY OF EXECUTIVE VICE PRESIDENT, SECRETARY, SHAREHOLDER, AND INCORPORATOR OF FINANCIAL MANAGEMENT GROUP, Ltd., AS PRESIDENT, SECRETARY, AND INCORPORATOR OF FMG ADVISORY, AS PRESIDENT, OWNER, AND INCORPORATOR OF PRO FINANCIAL GROUP, Ltd., AND AS GENERAL PARTNER OF POWER PRODUCTIONS I, AND FINALLY AS THE FOUNDER OF ALL THE PRECEDING.

THE AIRPLANE. THE ILLEGAL REPOSESSION OF THE AIRPLANE DEMONSTRATES THE DESPERATE ACTS OF CRIMINAL CONSPIRACY THAT CONFRONTED STAN J. CATERBONE.

FIRST, COMMONWEALTH NATIONAL BANK DID NOT NOTIFY STAN J. CATERBONE OF THE REPOSSESION UNTIL 4 DAYS LAYTER, AND BY REGULAR MAIL.

SECONDLY, THERE WAS ADEQUATE INSURANCE FOR THE AIRPLANE, PROVIDED BY LANCASTER AVIATION AND ROMAR AVIATION.

THIRDLY, TO IMPLY THAT FLYING THE AIRPLANE TO FLORIDA WAS A BREACH OF CONTRACT IS PROPOSTEROUS.

AND LASTLY, DEMANDING THAT THE AIRPLANE MUST REMAIN ON THE PREMISES OF LANCASTER AVIATION WITHOT PRIOR DISCLOSURE DURING THE SIGNING OF THE LOAN AGREEMENTS WOULD VIOLATE MANY RIGHTS OF THE BORROWER.

HOWEVER, MOST DAMAGING, AND MOST INCRIMINATING, IS THE FACT THAT STAN J. CATERBONE HAD SECURED FINANCING OF $5,000,000 AT MORE COMPETIVIE TERMS THAN COMMONWEALTH NATIONA BANK. THIS WAS WAR.

THIS ILLEGAL REPOSESSION WAS THE FIRST TIME ANY CREDITOR HAD EVER TAKEN ANY ACTION AGAINST STAN J. CATERBONE. THIS UNJUSTIFIED AND ILLEGAL ACT WAS INSTRUMENTAL IN SPREADING A FLOURISH OF RUMORS AROUND THE BUSINESS COMMUNITY, CLIENTS, AND CREDITORS OF STAN J. CATERBONE THAT FINANCIAL HARDSHIP AND DIFFICULTITIES WERE THE CAUSE OF ANY PENDING AND FUTURE PROBLEMS THAT WERE CONSPIRED AGAINST STAN J. CATERBONE.

IRONICALLY, EVEN UP TO AND INCLUDING AUGUST 8, 1987, (23 DAYS AFTER THE REPOSESSION)THE CREDIT REPORT OF STAN J. CATERBONE AS REQUESTED BY STAN J. CATERBONE OF THE LANCASTER CREDIT BUREAU, WAS IMPECABLE, AND HAD REPORTED THAT ALL ACCOUNTS ARE "PAID WITHIN 30 DAYS, OR AS PROMISED".

THE SUICIDE. ONE OF THE MOST INFLUENTIAL AND MOST DAMAGING ARSENOL AGAINS STAN J. CATEROBNE, WAS THE INSANITY ALLEGATIONS. INITIATED BY ROBERT KAUFFMAN ON JULY 6, 1987, THESE ALLEGATIONS WOULD EVENTUALLY GIVE THE RIGHT OF WAY FOR ALL CRIMINIAL AND ILLEGAL OFFENSIVE STRIKES THAT WOULD BE FURTHER USED TO REDUCE STAN J. CATERBONE TO NOTHING, LITERALLY.

IN ONLY A FEW WEEKS, THESE ALLEGATIONS HAVE RUINED AND DESTROYED ANY AND ALL BUSNIESS OPPORTUNITIES OF STAN J. CATERBONE. THE ALLEGATIONS WERE SPREAD AS FAR WEST AS HOLLYWOOD, CALIFORNIA, SPECIFICALLY GAMILLION STUDIOS AND FLATBUSH FILMS, AND AS FAR SOUTH AS HOUSTON, WHICH WAS THE HEADQUARTERS OF INSTITUTIONAL INVESTORS.

THE MOST FRUSTRATING, HUMILIATING, AND FRIGHTENING EXPERIENCES OF ALL WAS ON AUGUST 12, 1987, WHEN STAN J. CATERBONE WAS LITERALLY ARRESTED BY THE STONE HARBOR POLICE AT THE POLICE STATION, WHICH INCENDENTLY WAS WHERE STAN CATERBONE HAD VISITED IN ORDER TO INVESTIGATE INVASION OF PRIVACY LAWS, AND HANDCUFFED, TRANSPORTED, AND ADMITED TO THE BURDETTE TOMLIN HOSPITAL FOR PSYCHIATRIC EVALUATION OF THE CHARGES OF SUICIDAL TENDENCIES. IRREGARDLESS OF NO EVIDENCE, IT TOOK OVER 3 HOURS TO CONVINCE HOSPITAL PERSONELL THAT STAN J. CATERBONE HAD NO NEVER DISPLAYED ANY SUCH TENDENCIES TO ANYONE. THIS EVENT WAS JUSTIFIED BY IN ANONOMOUS PHONE CALL TO THE STONE HARBOR POLICE THAT STAN J. CATERBONE WAS "GOING TO THE BEACH TO KILL HIMSELF WITH A GUN". IT SEAMED INMATERIAL THAT STAN J. CATERBONE DID NOT OWN OR POSSES A GUN. THIS WAS A NIGHTMARE.

THE SECOND VISIT TO THE HOSPITAL OCCURED ON SEPTEMBER 9, 1987, THE DAY THAT BAIL WAS SECURED FOR THE RELEASE FROM THE LANCASTER COUNTY PRISON FOR THE CRIMINAL CHARGES OF THE FINANCIAL MANAGEMENT GROUP, Ltd., BURGLARY.

IN ACCORDANCE WITH THE CONDITION FOR BAIL THAT REQUIRED THAT STAN J. CATERBONE ADMIT HIMSELF VOLUNTARILY TO ST. JOSEPH MENTAL HEALTH UNIT, STAN J. CATERBONE RELUCTUNTLY AGRRED, FOR NO OTHER REASON THAN TO GET THE HELL OUT OF PRISON. THIS CONDITION WAS EVEN CONFIRMED AND INSISTED UPON BY THE CRIMINAL ATTORNEY REPRESENTING STAN J. CATERBONE.

NO ONE WOULD EXPLAIN TO STAN J. CATERBONE HOW THIS COULD NOT BE CONSTRUED AS AN INVOLUNTARY COMMITMENT, AND WHY THIS WAS BEING IMPLEMENTED. AFTER FIVE DAYS OF PRISON, AND FOUR DAYS OF THE HOSPITAL, THE EMOTIONAL AND PSYCHOLOGICAL TORTURE THAT WAS CONSTANTLY BEING INFLICTED HAD FINALLY BECOME UNBEARABLE.

THE PRISON. THIS WAS THE WORST FIVE DAYS OF LIFE FOR STAN J. CATERBONE. THE POWER AND THE DESTRUCTIVENESS OF THE CONSPIRACY HAD FINALLY BECOME REAL. STAN J. CATERBONE WAS PHYSICALLY AND VERBALY ABUSED BY THE MANHEIM TOWNSHIP POLICE DURING THE ARREST, AND DURING EVEN DURING HIS IMPRISONEMNT AT LANCASTER COUNTY PRISON.

AND THE MOST UNBELIEVABLE AND UNFOREGIVING OF ALL IS THE FACT THAT IT IS EASILY PROVEN THAT STAN J. CATERBONE WAS ARRESTED, INCARCERATED, AND ABUSED FOR BURGLARIZING HIS OWN PROPERTY, STEALING HIS OWN PROPERTY, IN A COMPANY THAT HE HAD MORE LEGAL RIGHT TO THAN ANYPERSON ON THIS EARTH.

IN ADDITION, THE EVENTS THAT LEAD TO HIS ARREST DURING THE NIGHT OF SEPTEMBER 3, 1987 WERE EVEN MORE BIZZARE. A FEW DAYS PRIOR, STAN J. CATERBONE HAD REACHED HIS HUMAN THRESHOLD FOR EMOTIONAL AND PSYCHOLOGICAL ANQUISH. THE FEAR OF THE COSPIRACY HAD REACHED MONUMENTAL PROPORTIONS, AND RESULTED IN THE ACUTAL FEAR FOR HIS LIFE. THERE WERE ALREADY SEVERAL VIOLATIONS OF INVASION OF PRIVACY AND PERSON WHICH SUPPORTED THIS. IN A DESPERATE PLEA FOR HELP, A LETTER WAS WRITTEN AND DELIVERED TO DIANE SAWYER OF "60 MINUTES". BY THIS TIME ALL CONVENTIONAL SOLICITATIONS TO LOCAL, STATE, AND FEDERAL AUTHORITIES PROVED FRUTLESS.

KNOWING THE THREAT AND THE FRUSTRATION THAT STAN J. CATERBONE HAD PROVED TO INFLICT UPON THE CONSPIRATORS, HE SET UP A MEETING WITH SEVERAL EXECUTIVES OF THE FINANCIAL MANAGEMENT GROUP, Ltd., WITH THE EXCEPTION OF MIKE HARTLETT AND ROBERT KAUFFMAN. THE MEETING WAS SCHEDULED WITH ALAN LOSS FOR FRIDAY, SEPTEMBER 4, AT THE OLDE HICKORY INN. ON THUSDAY, STAN CATERBONE CHARTERED A FLIGHT FROM CAPY MAY, NEW JERSY, TO LANCASTER WITH ROMAR AVIATION. THERE WAS A CREDIT WITH ROMAR THAT PAID FOR THE FLIGHT. STAN CATERBONE HAD ALSO MADE AN APPOINTMENT AT THE OFFICE OF UNEMPLOYMENT SECURITY FOR THAT AFTERNOON. NOT BEING ABLE TO PRODUCE AN INCOME WAS A HUGE PROBLEM BY THIS TIME.

STAN CATERBONE HAD ARRANGED TO BE PICKED UP AT THE LANCASTER AIRPORT BY MARYLYNN DIPAOLO AT ABOUT 2:00 PM. THEY WERE TO HAVE DINNER AT THE DIPAOLO RESIDENCE. THE TONE OF THE CONVERSATION BY MARYLYNN DIPAOLO WAS EXCEPTIONALLY DEFENSIVE AND AGGRESSIVE TOWARD STAN J. CATERBONE. IT WAS EVEN MORE DISTURBING TO FIND THAT MARYLYNN WAS ONE OF THE LAST ALLIES STAN CATERBONE HAD. THE CONVERSATION WAS DIRECTED AT INTEROGATIONS OF ALLEGATIONS THAT WERE TOTALLY ABSURD. NOT BEING EMOTIONALLY OR PSYCHOLOGICAL ABLE TO WITHSTAND THE CONFRONTATION, STAN J. CATERBONE ASKED

TO BORROW THE CAR IN ORDER TO PLAY BASKETBALL.

AFTER SEVERAL HOURS, STAN CAATERBONE PROCEEDED TO HIS CAR, AND UPON HIM WAS NANCY ARMENT, A SECRETARY FOR FINANCIAL MANAGEMENT GROUP, Ltd.,. SURPRISED, HE NORMALLY SAID HELLO. SHE IMEDIATELY BEGAN TO CRY AND SAY ARE YOU ALRIGHT, STARTED TO BECOME VERY EMOTIONALLY. SHE ALSO HAD BEEN DRINKING. STAN CATERBONE ASKED IF HE COULD HAVE A KEY TO THE OFFICE, SO THAT HE COULD GET SOME OF HIS THINGS. SHE SAID NO, AND STAN J. CATERBONE SAID HE UNDERSTOOD.

STAN J. CATERBONE BECAME SUSPICIOUS OF THE ATTITUDES AND EMOTIONAL STATE OF BOTH MAYLYNN DIPAOLO AND NANCY ARMENT. REALIZING THAT HE HAD A LEGAL AND JUSTIFIED RIGHT TO ENTER FMG., HE CALLED SEVERAL LOCKSMITH TO SIMPLY LET HIM IN. HOWEVER, NOT BEING ABLE TO PREDICT THE AFTERMATHS OF THAT SENERIO, HE CHANGED HIS MIND.

INSTEAD HE DROVE TO FINANCIAL MANAGEMENT GROUP, Ltd., TO SEE IF ANYONE WAS STILL WORKING. TO HIS DELIGHT, STACY WALTERS WAS CLEANING THE OFFICES. STAN CATERBONE WAVED THROUGH THE WINDOW, AND STACY QUICKLY SMILED AND RAN TO THE DOOR. SHE LET STAN CATERBONE IN, AND GAVE HIM A HUG AND KISS.

OVER THE NEXT 45 MINUTES, STAN CATERBONE COLLECTED FILES AND DOCUMENTS THAT HAVE BEEN PREVIOUSLY AND ILLEGALY HELD HOSTAGE BY HIS PARTNERS THAT WERE THE PROPERTY OF STAN J. CATERBONE, WELL WITHIN THE JURISDICTION OF PENNSYLVANIA SECURITIES LAWS, RULES, AND REGULATIONS, AND WITHIN THE LEGAL CONFINES OF PERSONAL AND BUSINESS PROPERTY AS DETERMINED BY HIS TITLES PREVIOUSLY DESCRIBED.

THE INCIDENT ENDED WITH A KISS GOODBYE TO STACY WALTERS, AND THE ESCORT OF HER SAFE RETURN TO THE BUILDING FROM THE PARKING LOT. IT WAS APPROXIMATELY 9:30 PM ON SEPTEMBER 3RD. UPON RETURN TO HIS RESIDENCE, A CONESTOGA POLICMAN ENTERED HIS PRIVATE PROPERTY AND PLACED HIM UNDER ARREST. THE CHARGES WERE NOT DISCLOSED. STAN CATERBONE REQUESTED TO THE ARRESTING OFFICER THAT THE FILES AND DOCUMENTS ACCOMPANY HIM TO THE POLICE STATION IN ORDER TO PROVIDE SUBSTANTIAL EVIDENCE THAT HE WAS A LEGAL LEASHOLDER OF THE BUILDING OF 1755 OREGON PIKE, AND HIS LEGAL AND OFFICAIL TITLES OF THE BUSINESSES CONCERNED THEREOF.

THE ARRESTING OFFICER FROM CONESTOGA TOWNSHIP WAS VERY UNDERSTANDING AND DEMONSTRATED A FAIR DEGREE OF RESPECT TOWARD STAN J. CATERBONE. HE ALLOWED STAN J. CATERBONE TO ACCOMPANY HIM IN THE FROT SEAT OF THE CAR, AS A NORMAL PASSENGER, WITHOUT ANY RESTRAINTS. THE OFFICER THEN PROCEEDED 4 MILES TOWARD LANCASTER AND PULLED OVER TO THE SIDE OF THE ROAD WHERE HE WAS MET BY TWO POLICMEN FROM MANHEIM TOWNSHIP POLICE DEPARTMENT. THE MANHEIM TOWNSHIP POLICE WERE NOT SO HOSPITABLE, AND THE TONE OF THE FOLLOWING 9 DAYS WAS IMMEDIATLY ESTABLISHED. AFTER GETTING OUT OF THE POLICE CAR, THE MANHEIM TOWNSHIP PLACED STAN J. CATERBONE IN HANDCUFFS AND SHACKLES AND BEGAN TO PHYSICALLY AND VERBALLY ABUSE HIM BY SLAMMING HIS HEAD AGAINST THE FRAME OF THE LEFT REAR DOOR OF THE POLICE CRUISER WHILE ADMINISTERING EXCESSIVE AND ABUSIVE PHYSICAL GRIPS UPON HIS PERSON. THERE WAS NEVER ANY COMMUNICATION FROM THE MANHEIM TOWNSHIP POLICE AND STAN CATERBONE CONTINUED TO DEMAND EXPLANATIONS CONCERNING HIS INCARCERATION AND ARREST DURING THE ESCORT TO THE POLICE STATION. THE

OFFICERS REFUSED TO ENGAGE IN ANY DIOLOGUE. THE OFFICERS DID THROW A PEICE OF PAPER ON THE FLOOR OF THE VEHICLE IN FRONT OF STAN J. CATERBONE, HOWEVER RETRIEVING THE PAPER WHILE SHACKLED WAS HUMANLY IMPOSIBLE, AND WAS ANOTHER DEMONSTRATION OF PHYSICAL AND PSYCHOLOGICAL TORTURE, ATTEMPTING TO BEND OVER AND RETRIEVE THE DOCUMENT RESULTED IN PAIN FROM THE TIGHTNING OF THE SHACKLES AND HANDCUFFS.

THE EVENING OF SEPTEMBER 3RD, DELIVERED UNSEASONALBLY COLD TEMPERATURES, AND STAN J. CATERBONE WAS CLOTHED IN SUMMER ATTIRE, DUE TO THE FACT THAT THE TEMPERATURES OF THE SHORE WERE EXTREMELY WARMER. UPON ARRIVAL TO THE MANHEIM TOWNSHIP POLICE DEPARTMENT, DETECTIVE LARRY MATHIAS CONDUCTED AN INTERVIEW THAT CONSISTED OF A FEW QUESTIONS LIMITED TO SEX, RACE AND RELIGION. STAN J. CATERBONE ATTEMPTED TO WARN DETECTIVE MATHIAS OF THE RAMIFICATIONS AND CONSEQUENCES OF THIS ABSURD ARREST AND ABUSE THAT WAS OCCURING, HOWEVER STILL THERE WAS NO ATTEMPT TO DISLOSE, EXPLAIN, OR DEFINE THE CHARGES OR THE SUSPECTED CHARGES.

AFTER ABOUT 5 MINUTES OF THE INTERVIEW, STAN J. CATERBONE WAS THROWN INTO A SMALL HOLDING CELL THAT CONTAINED ONLY CEMENT AND STAINLESS STEAL. A REQUEST FOR EITHER WARM CLOTHING OR A BLANKET WAS IMMEDIATLY RECINDED AND IGNORED. STAN J. CATERBONE WAS EXTREMELY SENSITIVE TO COLD, ESPECIALLY AFTER SUFFERING FROM EXTREME HYPOTHERMIA IN 1981, WHILE ADMINISTERING CPR TO A FREIND THAT HAD FALLEN 100 FEET TO HIS DEATH IN THE MOUNTAINS OF WORLDS END CANYON. EVER SINCE THE ACCIDENT, STAN J. CATERBONE'S TOLERENCE FOR COLD WAS DIMINISHED DRASTICALLY.

A FEW HOURS LATER, STAN J. CATERBONE WAS ESCORTED BACK TO THE POLICE VEHICLE FOR TRANSPORTATION TO DISTICT JUSTICE RICHARD R. REESER. IT WAS NOW APPROXIMATELY 3:00 AM ON SEPTEMBER 4TH, 1987. THE RIDE THAT WOULD FOLLOW WAS BY FAR THE MOST FREIGHTENING AND THE TERRORIZING EVENT THUS FAR. THE DISTRICT JUSTICE WAS APPROXIMATELY 12 MILES FROM THE MANHEIM TOWNSHIP POLICE STATION. HOWEVER, THE OFFICERS ELECTED TO TAKE THE BACK ROADS AND CONTINUED TO DRIVE AT EXCESSIVE HIGH RATES OF SPEED, LEAVING STAN J. CATERBONE HELPLESS DUE TO THE SHACKLES AND HANDCUFFS, AND LEFT HIM BOUNCING AROUND IN THE REAR SEAT OF THE POLICE CAR, ADMINISTERING BUMPS AND BRUESES FROM HIS BODY HITTING THE FRONT STEEL CAGE OF THE CAR AND THE DOORS. THE OFFICERS WOULD NOT REDUCE THE SPEED AFTER SEVERAL DEMANDS. THEY APPARENTLY THOUGHT THIS WAS AMUSING. TI=\FERRANTI - ISC - GUERIN - CATERBONE COMMUNICATION MATRIX (FRAUD)IM=310.CPRDA= January 18, 1991AT= AUDIO TRACKS: /ALLPA= PAGES: 01

SU= SUMMARY: This communication matrix illustrates the flow of information that was used in the alleged "BLACK MAIL" of Stan Caterbone and the "ISC $BILLION DOLLAR COVERUP"DI= ************************************************************ TI=\ISC PURCHASE IM=001P01.CPR DA= September 21, 1983 AT= CORRESPONDING AUDIO TRACKS: 02/08/09 PA= PAGES: 2 SU= SUMMARY: Confirmation of the purchase of 1000 shares of

International Signal & Control bought by Stan Caterbone on September 21, 1983. This stock was recommended and solicited by Gibson Armstrong of Individual Securities, of Lancaster PA. 01 IM=001P02.CPR DI= PAGE 2 DI= *****************************************************************

TI=\HIGH EMPLOYMENT IM=002P01.CPR DA= October 25, 1985 AT= CORRESPONDING AUDIO TRACKS: 02/PA= PAGES: 1 SU= SUMMARY: Letter to Paul Lewis, of High Associates, subsidiary of High Industries, requesting considerations for Employment. Ed Gordon, controller of the Horst Group, had refereed Stan Caterbone to High Associates. DI= *****************************************************************

TI=\COMMONWEALTH BANK SOLICITATION FOR EMPLOYMENTIM=003P01.CPR DA= October 28, 1985 AT= CORRESPONDING AUDIO TRACKS: 02/03/04/05/06/07/08/09PA= PAGES: 1 SU= SUMMARY: Letter to Larry Zieliski of the Commonwealth National Bank, from Stan Caterbone requesting considerations for employment in the Financial Services Department. DI= *****************************************************************

TI=\OWEN KUGEL ASSOCIATES EMPLOYMENT MEETING IM=004P01.CPR DA= November 5, 1985 AT= CORRESPONDING AUDIO TRACKS: 03PA= PAGES: 1 SU= SUMMARY: Letter thanking Owen Kugel for the interview with himself and Ed Pontius, for the employment considerations for raising funds for the development projects. S. Caterbone never heard back until they wanted funding from S. Caterbone in 1987. DI= ************************************************************ TI=\PRO FINANCIAL GROUP, Ltd., BROCHUREIM=005P01.CPR DA= April 4, 1986 AT= CORRESPONDING AUDIO TRACKS: 01/02/04/07/08 PA= PAGES: 2 SU= SUMMARY: Brochure of the Pro Financial Group, Ltd., a Pennsylvania corporation owned by Stan Caterbone, and was the preliminary design of Financial Management Group, Ltd., IM=05P02.CPR DI= PAGE 2 DI= ************************************************************

TI=\PARENT FEDERAL SAVINGS MORTGAGE CHECK IM=006P01.CPR

DA= July 12, 1986 AT= CORRESPONDING AUDIO TRACKS: 02/03/08/09 PA= PAGES: 1 SU= SUMMARY: Copy of the check for the loan proceeds for the residence at 2323 New Danville Pike, Conestoga PA, of which Stan and Mike Caterbone borrowed $100,000 from Parent Federal Savings and Loan, owned by James Guerin. DI= ************************************************************

TI=\S. CATERBONE FMG, Ltd., STOCK PURCHASEIM=007P01.CPR DA= June 26, 1986 AT= CORRESPONDING AUDIO TRACKS: 02/03/05/08/09 PA= PAGES: 1 SU= SUMMARY: Initial stock certificate for Stan Caterbone granting 40,000 shares of FNG, Ltd., stock. Stan Caterbone paid $.50 per share or $20,000 in full on June 26, 1987. DI= ************************************************************

TI=\R. KAUFFMAN FMG, Ltd., STOCK PURCHASE IM=008P01.CPR DA= June 26, 1986 AT= CORRESPONDING AUDIO TRACKS: 02/03/05/06/08/09 PA= PAGES: 1 SU= SUMMARY: Initial stock certificate for Robert Kauffman. Robert Kauffman paid $.50 per share. Mr. Kauffman received 60,000 shares of stock. Since Stan Caterbone was as responsible as anyone, if not more, for the development of FMG, Ltd., Mr. Kauffman agreed to an option agreement to Stan Caterbone for 10,000 shares at $.50 per share. Stan Caterbone was adamant about having equal equity with Mr. Kauffman. In addition, Mr. Kauffman had never paid for the additional 20,000 shares he purchased. He only paid for 40,000. This is a violation of PA Securities laws. DI= ************************************************************

TI=\FMG, Ltd., CHARTER BUSINESS PLAN IM=009P01.CPR DA= July 1, 1986 AT= CORRESPONDING AUDIO TRACKS: 01/02/04/05/06/07/08 PA= PAGES: 20 SU= Charter Business Plan for FINANCIAL MANAGEMENT GROUP, LTD. of Lancaster, Pa Dated July 1, 1987, created by S. Caterbone TABLE OF CONTENTS: Mission Statement Corporate Objectives Business Strategies Distribution Strategies Services Strategies Market Penetration Strategies

Planner Support Services Corporate Standards Initial Capitalization Financial Highlights Contingency Plans The Management Group Organizational Charts: Exhibit A Exhibit B MISSION STATEMENT l. To serve the people of the county, state and nation in the handling of their finances through the support of our financial planners and other advisors, and their personal relationships with their clients. 2. To meet the expectations of our various constituencies: planners, employees, stockholders, and the people residing in the area we serve. OBJECTIVES l. To position the company as the major provider and servicer of financial products and advice in the closely related fields of investments, financial consultation, mortgage banking, life insurance, property and casualty insurance, taxes, law, and real estate. 2. To transform the fragmented market of independent financial planners into a quality group of outstanding professionals marketing under one name, thus bringing order to the financial marketplace. 3. To place client interest first at all times by delivering a diversified product through multiple sponsors so as to always deliver high-quality and fairly priced products representing the top 25% percentile of the marketplace. 4. To develop and maintain quality service on previously delivered products by managing assets at a reasonable fee, thus freeing planners from the constant pressure of making new sales. 5. To insure the growth of the business by hiring professional planners in sufficient number so as to become the pre-eminent financial services company in the area served. 6. To use invested capital rather than loans and long-term leases to minimize monthly expenses and maximize profits, hereby assuring our business growth and development. 7. To encourage our planners to become stockholders in the firm, thus satisfying their desire for ownership in a company of real value. Also to assure a more stable development of our business through stronger ties with our top planners. 8. To react to changes in the marketplace ahead of our competition in creative and thoroughly considered ways.

9. To maintain a strong professional/client relationship through frequent personal contact while using high-technology equipment to enhance the quality of our work. BUSINESS STRATEGIES 1. CURRENT SITUATION Dozens of small independent planners servicing dissimilar markets through product sales. COMPANY STRATEGY Recruit the small, independent financial planner into our group using a variety of motivating factors: l. economics (reduce their expenses, expand their resource material and backup) 2. marketplace recognition and dominance 3. company identity 4. equity ownership 5. product diversity 6. higher commissions on each sale through group negotiation of payout 7. specially expertise in related financial areas and reference material 2. CURRENT SITUATION Life insurance and brokerage businesses are suffering from poor performance of products, bad press, and low-quality recruiting cutting commissions; while productive veterans in these industries are uneasy with these changes. COMPANY STRATEGY Recruit the most senior, productive brokers and agents who desire to do more personal planning by providing the advantages cited in paragraph 1 above. 3. CURRENT SITUATION The l986 Tax Act threatens to reduce the need for tax planning, and tax qualified plans. Rather than seek shelters and other relief, investors will be likely to pay tax, and invest savings, thereby increasing the need for asset management and the creation of wealth Through equity investment. COMPANY STRATEGY Market products that are structured with lower up-front costs and stable ongoing management renewals in order to build revenue from service over a period of time. This will gradually replace the heavy emphasis on new sales and give rise to a truly responsive service oriented business. 4. CURRENT SITUATION

Mass marketing through corporate benefit plans and the media continues to grow as a segment of the financial services business. COMPANY STRATEGY Develop corporate sales through the concept of cafeteria plans which will change the employee benefit market by allowing employees to target a percentage of benefit dollars to the areas of their choice. Also, continue to emphasize seminars targeting unique organizations which have a strong relationship with the public for specific financial products: EX. Charitable organization - charitable giving seminars. estate planning seminars Counseling center - life planning seminars, etc. Additionally, we will develop public awareness by constantly advertising the corporate name via newspaper and radio. DISTRIBUTION 1. Current Situation We currently have many contracts for financial planners and other professionals whom we seek to commit to an August occupancy in new space in Columbia, Maryland Company Strategy We plan to increase our Columbia group to 12 financial planners and 4 other professionals during the next year. While we plan to locate and develop in new areas, we will concentrate during our first year in our Lancaster operations. 2. Current Situation At the current time we know some very successful professionals established in business for at least five years. Company Strategy We will continue to seek predominately self-sufficient, professional "veterans" of the industry. Our desire is to appeal to their need for the freedom to plan and communicate more effectively with their clients. We'll also offer a higher payout, more varied products, and a more professional environment. We will duplicate only the most critical brokerage house services. 3. Current Situation Planners have been stable in their relationship with past employers. Company Strategy

We expect a very stable core of top planners in Columbia, MD., due to strong management, stable planners, strong local support systems, and equity ownership. We will concentrate on local development ahead of satellite development. We expect our satellite retention to be outstanding where equity ownership is strong and mediocre where equity ownership is weak. 4. Current Situation Planners are independent and thus use various planning techniques, offer a limited product and differ in their areas of expertise. Company Strategy The expertise and techniques of our planners and other professionals will be pooled to provide clients with higher quality service and a broader line of products. SERVICES 1. Current Situation Investment products are predominately delivered through captive sales organizations who manufacture their own products and manage all monies. This leads to limited product offerings which frequently do not entirely satisfy specific consumer needs. It also leads to a mediocre product because there is no free market pressure to insure top quality products that are competitively priced. Company Approach Planners will be free to deliver the highest quality products from among thousands of sponsors so as to work exclusively for the benefit of the client. The planner may choose top industry performers, solid and sizeable companies and a variety of "niche" products to fill every client need. 2. Current Situation Fee-paid financial plans vary widely in price and quality and depend most heavily on the individual developing the plan or interpreting it. With regard to consumer expectations, the marketplace is in disarray. Company Approach Fee-based plans in advance of product sales should become simpler Due to tax reform. The majority of such plans were originally purchased for tax planning which may no longer be needed. Our emphasis will be on a business being revived by tax reform - - Asset Management or Investment Monitoring. With clients paying their taxes and investing for appreciation rather than seeking shelters, this business is expected to boom.

We plan to have an in-house portfolio manager and market-timer. We plan to charge clients an average of .75% for the service. As planners gain assets under management, their annual income from this source should alleviate pressure for new clients. 3. Current Situation Associated professionals such as attorneys, accountants, bankers, and insurance and real estate agents seldom cooperate to help clients attain their goals. The ultimate control of the client's future business tends to become divided, making people defensive and producing fear of exposure in the event of error. This often leads to professionals discrediting one another or taking undue credit for advice leading clients to inaction. Company Approach In-house legal and real estate professionals will enable a planner to get such services for his client without fear of losing the client to outside interests. It will also help conserve revenue normally spent for such services.

4. Current Situation Ongoing client service is a desire for most companies in our marketplace. However, the constant pressure is applied to planners to produce new clients and new sales as 90% of earnings is still commission generated. The time required to prospect and close new sales severely limits the necessary servicing time. Company Approach Ongoing client service will be supplied through a semiannual newsletter and semiannual client investment update delivered alternately every three months. The costs of these services will be borne by client-paid asset management fees, insurance renewals and mutual fund trailing commissions. Although this is an ambitious, high-tech undertaking, our basic inclination remains toward personal client review sessions held on a regular basis. We also expect better crossover relationships and broadened information base for both planners and specialists due to common location. Market Penetration Strategy l. Existing Clients - - Planners and other professional joining our group will have developed deep personal client relationships which should allow new investment dollars to be handled by our people. As follow-up systems are implemented we expect 65% of all business to come from this source. 2. Seminar Presence - - We plan to present four seminars on

a joint basis with institutions such as colleges, charities, business organizations and corporations. Our seminars include "Successful Money Management"- - a soup-to-nuts on investment products, "Half-Time" - - a life planning seminar, "Charitable Giving" and Retirement Planning Seminars. Currently our planners regularly appear at Millersville State College, RCA, ALCOA, St. Joseph's Hospital and elsewhere. We also plan regular seminars for the general public. 3. Business and Retirement Markets - - These two markets will be singled out for specific emphasis because of the vast potential and strong need for planning among these groups. Business benefit plans and specifically "cafeteria plans" will be marketed. Retirement markets will be expanded primarily through increased seminar marketing. Planner Support Services It is our plan to provide necessary office and clerical support services to help each Planner or affiliate conduct his or her business. We intend to limit our office to support services and not to provide specific marketing services for individuals. Our marketing efforts will be for the group at large, that is to say that individual prospecting will be a personal expense borne by the planner or advisor. Inherent in our support services will be the following: l} Phone Handling - including the facility to forward other business lines to our central system should a planner leave the office. 2} Repetitive Standard Correspondence - a sample of thank you, referral appointment setting, data requests, and commonly used review letters may be selected and generated. Personal correspondence will not be handled by our staff, free of charge. 3} Business Processing - completed applications will be checked, logged, copied and mailed by our cashiers. Follow-up with broker/dealer or product sponsors will be offered to premier producers only. 4} Computer Services - financial plans and investment monitoring services will be provided through data base entry. Mass distribution and hard-copy plan generation will be done on a piece by piece and percentage fee basis respectively. 5} Professional Networking - our in-house affiliates in law, accounting, tax, estate, real estate, mortgage brokerage, portfolio management, life insurance and property/casualty insurance stand ready to serve clients related financial needs. 6} Supply Stocking - prospectus, applications, trust agreements and other forms needed to conduct business with our major product suppliers will be maintained.

7} Reference and Periodicals - professional journals and data services meeting the common need of our advisors will be purchased and will be maintained by our office staff. Material unique to specialized areas will be provided by those planners who work in those areas. 8} Corporate Marketing - we will promote the name of our firm along with all planner affiliates to gain public awareness in excess of what any individual alone could achieve. We will become the best known firm in Central Pennsylvania. 9} Training and Education - Pooling our production will give us additional clout with sponsors, industry trainers and those wishing to address our membership. Cost should be lower and quality higher. It is our plan to provide a constant flow of information, new product profiles, and specialized planning techniques. 10} Gross Payout Negotiation - Size and strength of our group should allow us to increase concessions made by sponsors over amounts normally negotiable by individuals. OUR STANDARDS FOR A GREAT COMPANY Having well established business principles is critical to the success Of any new Business. Only persistence, hard work and sufficient capital can rival its importance. We feel the need to state the basic values of this firm so that the basis for the decision-making is well established and understood. A great company.. l. Serves its customers well. 2. Treats people properly. 3. Operates on high principles. 4. Makes money regularly. 5. Guards the interests of stockholders and employees. 6. Knows its mission. 7. Knows its position in the marketplace. 8. Desires solid community and corporate citizenship. 9. Hires superior people and pays them well. 10. Will change course amidst changing times. 11. Has the vision to see opportunity. l2. Retains entrepreneurial spirit. l3. Has a bias for action (do it, try it, fix it). l4. Is value driven. l5. Regards people as its greatest asset. 16. Uses a lean staff, a simple form of management l7. Pushes decision-making to the lowest level. l8. Promotes deserving people, regardless of race, sex, or religion. We hereby resolve to build such a company. INITIAL CAPITALIZATION

Stock will be offered to the public at $5.00 per share until the office opens on August 1, 1986. It is our plan to raise $300,000 which will cover the start-up costs of furnishing the office, capitalizing the Registered Investment Advisor and Broker-Dealer, and funding any shortfall in operating revenues for at least one year. It is our intention to avoid borrowing monies if at all possible. We believe that it is best to pay in advance and that a debt-free status keeps monthly obligations to a minimum, thus reducing business risk and increasing profitability. We are, likewise, committed to low management incomes for all principals/planners who will continue to generate personal income from sales. Our initial price will be discounted in order to recognize the importance of several types of investors in our business. First, investors who purchase in excess of 5,000 shares are important because of our limit of 35 investors in the offering each year. Without sizeable investors, we will not be able to meet our target of raising $300,000. Additionally, investors who will also generate revenue for the business through financial services marketing provide double value for our firm. Consequently, we will offer shares at 3.50 to any major investor or producing investor. If any investor proves to be both major and producing, his price will be $2.50.

Our estimate of stock value, given recent takeover prices in the industry, would place the stock value at $5.60 after one year and $l0.67 after three years. That price would be 3.5 times book value which increases with each stock purchase. Purchases of some companies have been based not on book value but rather on gross commission income. The going price the last several years has been a dollar for dollar price. Using that figure stock value would be $l0.00 in one year, and $13.33 in three years. Financial Service Corporation, a company reforming in l978, is valued at $25 million dollars just eight years later. The potential in this business is obvious, yet there are no guarantees. This is a start-up business venture and suitable only for long-term, equity investors. It is our plan to build aggressively in several areas, but to concentrate in Pennsylvania. We see a special opportunity with a three to five year window when banks will get into our business through acquisitions as they continue to lose assets through their limited banking functions. Should a great opportunity to sell occur, we would consider it at that time. Our continued personal planning business could give us the luxury of cashing our investment and remaining in business. However, it is much more likely that we will hold our investments until retirement or pass it on to future generations. Our specific issue restricts sales to another party for one year and also limits repurchases to intrastate parties.

FINANCIAL HIGHLIGHTS * Actual Statistics as of May 30, 1987 1987 1988 1989 May '87 SALES (Millions) CAPITAL 54.00 M 78.10 M 100.00 M 80.00 M Commissions 2.70 M 3.40 M 5.00 M 3.50 M (GCI) Affiliate 0.30 M 0.60 M 1.00 M 0.50 M Earnings Total Gross 3.0Z M 4.00 M 6.00 M 4.00 M Revenues Net Revenue 0.76 M 1.01 M 1.52 M N/A Less Commission SALES FORCE Manpower 37 43 50 48 (Professionals) Hires 10 12 14 14 Retention 90% 85% 85% 95% Average Sales $81,081 $107,500 $120,000 $85,000 (Per Professional) FINANCIAL (All Numbers in Millions of Dollars) 1987 1988 1989 MAY '87

Revenue 3.000 4.000 6.000 4.000 Net Revenue 0.760 1.010 1.800 N/A Retained 0.210 0.275 0.501 N/A (Profits)

Return on 70.0% 53.9% 66.6% N/A Equity

Capital Base 0.300 0.510 0.785 N/A Book Value 0.300 0.480 0.725 0.300 Beginning of Year Book Value 1.600 1.810 3.050 4.000 Per Share Book Value 0.480 0.725 1.526 N/A End of Year

Shares 300,000 400,000 450,000 245,000 Outstanding Value/Share $5.60 $6.34 $10.67 $14.00 (at 3.5 x book) Traditional $10.00 $10.00 $13.33 $17.00 (at 1 x Total Gross Revenue) CONTINGENCY PLANS The beginning phase of most businesses phase is characterized by erratic sales Trends, fluctuating market share, increasing dependence on improving technological systems, and possible cash flow losses. We do not expect to face any of these problems because of the established nature of the planners we are hiring. However, we would be foolish to believe that we somehow were immune from such potential problems and therefore need not to plan for these eventualities. Our very first need would be to raise capital through stock purchases beyond our initial capitalization requirements to the extent of at least $100,000 to cover any initial shortfall in revenue or budget projections. This would protect us from going the way of most undercapitalized businesses - - bankruptcy. Secondly, we expect to invest heavily in state-of-the-ar technological system so that we do not face new hardware/software changes early in our business development. Stan Caterbone will devote much of his management time to this area. Priority will be given to reviewing performance against objectives on a monthly basis. All objectives will be quantifiable and measurable, and as necessary adjustments will be made and monitored accordingly. Such scrutiny of performance will allow us to constantly assess and respond to any possible shortcomings and to market needs. Our management is committed to deriving a large portion of its personal income from serving clients as opposed to relying on management income. This should preserve our cash flow and insure its growth. BIOGRAPHY OF STANLEY J. CATERBONE Stanley J. Caterbone is currently proprietor of S. J. Caterbone Associates, a Financial Planning Firm specializing in but not limited to upper income individuals. He is also president and founder of Pro Financial Group, LTD., a firm providing financial

services and contractual negotiations to Professional Athletes and Agents. Stan began his career with a financial subsidiary of American Express, IDS Financial Services. He was hired by and worked with Bob Kauffman for six months before Bob was promoted to the Florida area. Stan developed a practice centered around fee-based planning that focused on the tax aspects and concerns of individuals while they pertained to the clients investments and overall financial situation. While at IDS, Stan was one of the leading planners in the nation to utilize fee based planning at its inception. He was one of the top producers in central Pennsylvania, and ranked number 5 in the nation in his class. He also had closed one of the biggest estate planning cases in the division. In January 1985, Stan left IDS and became independent to provide a better Product line for his clients and to escape the proprietary environment. He is very creative and has developed a strong practice among physicians. Stan has developed a variety of professional networks throughout the country With regard to the various Sports Professionals that he works with. He is currently working on a joint venture with former Chief Financial Officer and Vice President of Doubleday Publishing Company, Richard E. Madigan. He is looking to Stan to help him manage an annual income of $7 million from the 20 Professional Athletes that he currently manages. Stan has helped to develop the Central Pennsylvania Chapter of the International Association of Financial Planning, and had organized and attracted more than 100 persons to attend a dinner meeting with Alexandria Armstrong, one of the more prominent Financial Planners in the nation, who is currently the National President of the IAFP. He is also a member of the Estate Planning Council of the Institute of Certified Financial Planners. Stan is currently a Certified Contract Advisor of the National Football League Players Association and the NBA. Stan will be an Executive Vice President responsible for professional networking and marketing and some of the fiscal and negotiating functions. BIOGRAPHY OF ROBERT E. KAUFFMAN Bob Kauffman is currently the National Sales Manager, at large, for FSC Securities Corporation. FSC is a broker-dealer with a l200 planner sales force. It raised over 600 million dollars of investment capital in 1986. Bob's responsibilities include developing a company-owned distribution system whereby FSC products and services are delivered to the public-at-large through FSC Financial Service Centers. Bob is also responsible for recruiting proven financial planners through out the nation for Financial Service Corporation. He also contributes to the strategic planning of sales for FSC Securities

Corporation.. Bob began his career with a financial subsidiary of the American Express Corporation in 1976 upon his graduation from Millersville State College in Millersville, Pennsylvania. In his four years of direct selling to the public, he became the youngest person in the company to achieve multi-million dollar production status at the age of 25. Bob then began to take on additional associates as he began to build his practice in Lancaster, Pennsylvania. In just two years, his practice had grown to l2 representatives handling over $l2 million dollars a year in annual investments and managing in excess of $60 million dollars of client monies. While building this operation, Bob continued to be the leading producer in his office and the region. Bob was then promoted to division manager of the West Coast. In that position, He tripled the size of the sales force and increased volume over 500% in a period of 2 years. His division of American Express handled over $l00 million dollars of investor monies. Bob was then asked to take over the largest operation in the southeast, located in Atlanta in l984. With over 60 financial planners, handling an excess of $200 million dollars of investor's monies, Bob again moved his territory into the top echelon of the company. With FSC since l985, Bob has opened the first three company-owned offices and now supervises an excess of 75 employees. His operations now rank 4th in all FSC related planning operations. Bob brings to Financial Management Group, Inc. l0 years of experience in the financial planning industry in both sales and sales management. He is a member of the International Association of Financial Planners and is in the process of completing the course work for Certified Financial Planners designation. Bob is a frequent speaker at both corporation and business financial planning functions and has been quoted frequently in local and national media publications. He continues to handle investments for select clients. Bob will serve as president, chairman of the board and will be the largest stockholder. His experience in managing and developing large financial service organizations will provide the leadership and expertise necessary to insure the growth we envision. BIOGRAPHY OF MICHAEL M. HARTLETT, AFP Mike Hartlett is currently an independent financial planner and heads his own local firm - - Financial Planning Consultants. Mike is a licensed securities principal and fully a licensed securities broker. He has completed the Certified Financial Planning program with the College for Financial Planning and currently holds an Associate Financial Planner designation. He will receive the Certified Financial Planner designation in

February 1987. Mike began his Financial Planning career five years ago with IDS a subsidiary of American Express. During his career with IDS he was among the firm's top planners. He was on the Presidents Advisory Council for IDS in 1985 and from a field of over 5,200 IDS planners, finished among the top 66 financial planners in the country. In 1983 and 1984 he was among the top three in IRA/Qualified Plan Production. In September, 1985 he left IDS to form his own financial planning firm. Mike has an extensive knowledge of corporate retirement plans and pension programs and has excelled in retirement planning for individuals. He conducts financial planning seminars in several large Lancaster County corporations and is active in promoting financial planning in Lancaster County. Mike currently manages in excess of $14 million in client assets. Mike is committed to delivering the highest quality planning services to his clients. He believes that personal attention and service are the key to a strong client/planner relationship. Mike will serve as Executive Vice President of Financial Management Group, Ltd. He will be in charge of operations and serve as chief financial officer. FINANCIAL MANAGEMENT GROUP, LTD. (Exhibit A) Financial Securities, Inc. ................The Broker Dealer FMG Advisory, Inc. ........................The Registered Investment Advisor Financial Services Insurance Agency .......The Insurance Agency FMG Accounting Services, Inc. .............The Accounting Firm Financial Mortgages Services, Inc. ........The Mortgage Broker Wealth Management Services, Inc. ..........The Portfolio Manager & Market Timer Financial Planning Consultants, Inc. ......The Financial Planning Firm AFFILIATE FIRMS (In House) Berger Real Estate ........................Real Estate Services O'Day & Smith .............................Legal Counsel for Business & Real Estate Shirk, Reist, Wagenseller & Shirk .........Legal Counsel for Estate Planning Lovell Associates, Inc. ...................Property & Casualty Services Pro Financial Group, Inc. .................Services for Professional Athletes * Please note that the above firms are currently under negotiations and have given verbal commitment for affiliation. DI= **************************************************************** IM=009P02.CPR

DI= PAGE 2 IM=009P03.CPR DI= PAGE 3 IM=009P04.CPR DI= PAGE 4 IM=009P05.CPR DI= PAGE 5 IM=009P06.CPR DI= PAGE 6 IM=009P07.CPR DI= PAGE 7 IM=009P08.CPR DI= PAGE 9 IM=009P10.CPR DI= PAGE 10 IM=009P11.CPR DI= PAGE 11 IM=009P12.CPR DI= PAGE 12 IM=009P13.CPR DI= PAGE 13 IM=009P14.CPR DI= PAGE 14 IM=009P15.CPR DI= PAGE 15 IM=009P16.CPR DI= PAGE 16 IM=009P17.CPR DI= PAGE 17 IM=009P18.CPR DI= PAGE 18 IM=009P19.CPR DI= PAGE 19 IM=009P20.CPR DI= PAGE 20 DI= **************************************************************** TI=\FMG, Ltd., RULE 144, REG D DRAFT OFFERING IM=010P01.CPR DA= July 31, 1986 AT= CORRESPONDING AUDIO TRACKS: 01/02/04/07/08 PA= PAGES 3 SU= SUMMARY: Correspondence from Jeff Jamouneau of McNeese, Wallace, and Nurick, in regards to the requirments and advice to Stan Caterbone with regards to his efforts of writing the Offering Memorandum for Financial Management Group, Ltd., to raise the initial capital by way of a Regulation D, Rule 144, Private Placement Offering, registered with the Pennsylvania Securities and Exchange Commission. IM=010P02.CPR DI= PAGE 2 IM=010P03.CPR DI= PAGE 3 DI= ********************************************************************

TI=\FORM D REG 144 CORRESPONDENCE

IM=011P01.CPR DA= August 7, 1986 AT= CORRESPONDING AUDIO TRACKS: 01/02/04/07/08 PA= PAGES: 2 SU= SUMMARY: Letter from Jeff Jamouneau to Stan Caterbone regarding filing procedures for the FMG Ltd, Regulation D, Rule 144 Offering Memorandum, filed with the Pennsylvania Securities Commission. IM=011P02.CPR DI= PAGE 2 DI= ******************************************************************** TI=\SALE OF FMG, Ltd,. STOCK IM=012P01.CPR DA= August 11, 1986 AT= CORRESPONDING AUDIO TRACKS: 01/02/04/07/08 PA= PAGES: 2 SU= SUMMARY: Letter from Jeff Jamnouneau to Stan Caterbone addressing the requirements for the actual sale of the FMG, Ltd,. stock pursuant to Section 203(d) of the Pennsylvania Securities Act of 1972 with respect to the Pennsylvania Securities Commission. IM=012P02.CPR DI= PAGE 02 DI= ****************************************************************

TI=\OFFERING MEMORANDUM LEGAL DOCS (PA SEC)IM=013P01.CPR DA= August 19, 1986 AT= CORRESPONDING AUDIO TRACKS: 01/02/04/07/08 PA= PAGES: 1 SU= SUMMARY: Letter from Stan Caterbone to Joseph Lyden, of the Pennsylvania Securities and Exchange Commission. DI= **************************************************************** TI=\LEGAL FEES FOR FMG, Ltd., FORMATION IM=014P01.CPR DA= August 22, 1986 AT= CORRESPONDING AUDIO TRACKS: 01/02/07/08 PA= PAGES: 1 SU= SUMMARY: Letter for the legal fees for the set up and formulation of FMG, Ltd., to Stan Caterbone from Tim Lanza, of O'Day and Smith, of Lancaster PA. Invoice also includes fees for the formation of all subsidiaries. DI= ****************************************************************

TI=\FMG Ltd., REGISTRATION WITH PA SEC IM=015P01.CPR DA= August 25, 1986 AT= CORRESPONDING AUDIO TRACKS: 01/02/04/07/08 PA= PAGES: 1 SU= SUMMARY: Letter to the Commonwealth of PA, Department of

State Corporation Bureau from attorney Tim Lanza for the registration of FMG Securities, Inc. DI= *************************************************************** TI=\INVOICES FOR LEGAL FEES FOR FMG FORMATION IM=016P01.CPR DA= August 22, 1986 AT= CORRESPONDING AUDIO TRACKS: 01/02/04/07/08 PA= PAGES: 1 SU= SUMMARY: Invoice for the legal fees for the formation of FMG Ltd., and its subsidiaries. DI= *************************************************************** TI=\FMG, Ltd., IRS EMPLOYER ID WITH PENNSYLVANIA IM=017P01.CPR DA= August 25, 1986 AT= CORRESPONDING AUDIO TRACKS: 01/02/04/07/08 PA= PAGES: 1 SU= SUMMARY: Copy of the application for Employer Identification Number to the Internal Revenue Service, from attorney Tim Lanza. DI= *************************************************************** TI=\REGISTRATION FOR FMG Ltd., OFFERING MEMORANDUM IM=018P01.CPR DA= August 29, 1986 AT= CORRESPONDING AUDIO TRACKS: 01/02/04/07/08 PA= PAGES: 8 SU= SUMMARY: The final Subscription Agreement prepared by Stan Caterbone with the counsel of Jeff Jamouneau of McNeese Wallace & Nurick, of Harrisburg. Stan Caterbone prepared the Offering Memorandum and the Subscription Agreement with Jeff Jamouneau acting as advisor. IM=018P02.CPR DI= PAGE 2 IM=018P03.CPR DI= PAGE 3 IM=018P04.CPR DI= PAGE 4 IM=018P05.CPR DI= PAGE 5 IM=018P06.CPR DI= PAGE 6 IM=018P07.CPR DI= PAGE 7 IM=018P08.CPR DI= PAGE 8 DI= *************************************************************** TI=\FMG OFFERING MEMORANDUM LEGAL CORRESPONDENCE IM=019P01.CPR DA= August 29, 1986 AT= CORRESPONDING AUDIO TRACKS: 01/02/04/07/08 PA= PAGES: 1

SU= SUMMARY: Letter from attorney Jeff Jamouneau to Stan Caterbone enclosing the Subscription Agreement for the Offering Memorandum of FMG Ltd.,. DI= *************************************************************** TI=\LANCASTER COUNTY BAR ASSOCIATION REPLY IM=020P01.CPR DA= September 19, 1986 AT= CORRESPONDING AUDIO TRACKS: 01/02/04/07/08 PA= PAGES: 4 SU= SUMMARY: This letter is the reply of the Lancaster Bar Association as to the question of ethics if the law firm of Shirk, Reist, Wagenseller and Shirk would formally associate with FMG, Ltd.,. Kenelm L. Shirk, Jr., was business associate of Stan Caterbone's whom he often would confide business matters especially the start up of FMG, Ltd., IM=020P02.CPR DI= PAGE 2 IM=020P03.CPR DI= PAGE 3 IM=020P04.CPR DI= PAGE 4 DI= *************************************************************** TI=\FSC COMPUTERS REQUESTS IM=021P01.CPR DA= November 21, 1986 AT= CORRESPONDING AUDIO TRACKS: PA= PAGES: 1 SU= SUMMARY: Letter requesting the return of computers that were originally in the FSC broker dealer deal. DI= *************************************************************** TI=\FISCHER LICENSE REQUESTIM=022P01.CPR DA= April 29, 1987 AT= CORRESPONDING AUDIO TRACKS: PA= PAGES: 1 SU= SUMMARY: Letter to Hibbard Brown regarding licensing arrangement from Fred Fischer, a FMG, Ltd., recruit of Stan Caterbone DI= *************************************************************** TI=\TUCKER RIA LETTER IM=022P01.CPR DA= December 31, 1986 AT= CORRESPONDING AUDIO TRACKS: PA= PAGES: 1 SU= SUMMARY: Letter to Thomas Tucker regarding the operations of the Registered Investment Advisor. DI= ***************************************************************

TI=\JOB DESCRIPTION FOR FMG, Ltd., IM=023P01.CPR DA= December 4, 1986 AT= CORRESPONDING AUDIO TRACKS: PA= PAGES: 1 SU= SUMMARY: Job Description of Stan Caterbone, written by Robert Kauffman. DI= *************************************************************** TI=\BRAVERO LETTER IM=024P01.CPR DA= January 5, 1987 AT= CORRESPONDING AUDIO TRACKS: PA= PAGES: 1 SU= SUMMARY: Letter to Stan Caterbone from Jerry Braver, one of the Satellite Offices. Letter discuss computer technologies. DI= *************************************************************** TI=\UMIKER WILL IM=025P01.CPR DA= January 8, 1987 AT= CORRESPONDING AUDIO TRACKS: PA= PAGES: 2 SU= SUMMARY: Letter to Stan Caterbone from Dore Valvanes, discussing certain strategies for the Estate Planning of Dr. William Umiker, of which Stan Caterbone has been providing Financial Advisory services for the past 2 years. Dr. Umiker was the mentor for Stan Caterbone, and Stan Caterbone was named the Trustee for his Estate, valued in $ millions. IM=025P02.CPR DI= PAGE 2 DI= *************************************************************** TI=\FMG ADVISORY RIA IM=026P01.CPR DA= January 13, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/04/07/08 PA= PAGES: 2 SU= SUMMARY: Letter from Pual Schwartz, Acting Director, Division of Licensing, PENNSYLVANIA SECURITIES COMMISSION. The letter discusses the status with the application of FMG Advisory, Inc., for status of a Registered Investment Advisor. IM=026P02.CPR DI= PAGE 2 DI= *************************************************************** TI=\ROYER LETTER OF INTENT IM=027P01.CPR DA= January 14, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1

SU= SUMMARY: A letter from Carolyn Royer to the principals, Hartlett, Kauffman, and Caterbone. This letter was intended to provide motivation for Kauffman and Hartlett to commit to compensation and a position in the brokerage department. Carol Royer went through the difficult task of passing the test for the Series #24 license, in which a position and salary would follow. Of course they lied. Carolyn Royer resigned several weeks later. DI= *************************************************************** TI=\SERIES #24 EXAMINATION REPORT OF C. ROYER IM=028P01.CPR DA= January 15, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: Carolyn Royer's Series #24 Examination Score Report. DI= *************************************************************** TI=\INSTITUTIONAL INVESTORS SOLICITATION IM=029P01.CPR DA= January 20, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/07/08 PA= PAGES: 2 SU= SUMMARY: Letter to Stan Caterbone from Al Dannatt, of Institutional Investors, of Houston TX, requesting to form a formal business relationship for the mortgage banking business. All Dannatt had provided a portfolio of residential, commercial, industrial, nursing home, minihouses, hotels, mobile home parks and ACLF facilities. The mortgage packages ranged from $3 million to $500 million is size, and were as much and even more competitive with at least Famrmers First Bank, Fulton Bank, and Commonwealth Bank. IM=28.CPRPA= PAGE 2DI= *************************************************************** TI=\INSTITUTIONAL INVESTORS' LOAN PORTFOLIO IM=030P01.CPR DA= January 20, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/07/08 PA= PAGES: 1 SU= SUMMARY: Loan Portfolio and Current Rate Quotes to Stan Caterbone from Al Dannatt of Institutional Investors. Rates were more competitive than most local lending institutions as well as the lending limits. DI= *************************************************************** TI=\HIBBARD & BROWN COMPANY -- FMG, Ltd., ACQUISITION IM=031P01.CPR DA= January 20, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 2

SU= SUMMARY: Letter from Robert Kauffman to Peter Hibbard of the Broker Dealer Hibbard Brown & Co., outlining the first draft of a proposed merger and acquisition of FMG, Ltd., and Hibbard Brown & Company. "I have discussed our visit with the other two partners and the initial reactions have been favorable". IM=031P02.CPR DI= PAGE 2 DI= *************************************************************** TI=\FMG, Ltd., BOARD MINUTES OF 01/26/87 IM=032P01.CPR DA= January 26, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/04/07/08 PA= PAGES: 2

SU= SUMMARY: Board Meeting of January 26, 1987. The Board votes to add 2 additional Board of Directors. Alan Loss and Bob Long are selected. IM=032P02.CPR DI= PAGE 2 DI= *************************************************************** TI=\HIGH ASSOCIATES Ltd. REQUEST FOR FINANCING IM=033P01.CPR DA= February 3, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: At the request of Bob Long, Stan Caterbone writes to Tom Kyle, of High Associates, whom is a Board of Director of American Helix, which Stan Caterbone is partners in the "Digital" technologies industry. Tom Kyle had requested information of financing capabilities. High Associates is the largest real estate developer in Lancaster County. DI= ***************************************************************TI=\ROYER -- FMG, Ltd., CONFLICT IM=034P01.CPR DA= February 5, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/04/07/08 PA= PAGES: 1 SU= SUMMARY: Continuing efforts by Carolyn Royer to only what she was promised by Kauffman and Hartlett. DI= *************************************************************** TI=\FMG, Ltd., BOARD MINUTES OF 02/10/87 IM=035P01.CPR DA= February 10, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/04/07/08 PA= PAGES: 2 SU= SUMMARY: Robert Kauffman drafts a very "aggressive" letter to Carolyn Royer, and asks for input. Letter was embarrassing to Stan Caterbone. FSC terminates contract with Kauffman. Kauffman had

been collecting compensation from both FMG, Ltd., and FSC of Atlanta. Stan Caterbone had urged Kauffman to communicate to FSC in as early as April of 1986, that FMG, Ltd., would eventually terminate its Broker Dealer contract with FSC. Kauffman never did in order for $$$. IM=035P02.CPR DI= PAGE 2 DI= ************************************************************ TI=\SHENDEL REQUEST FOR FINANCING IM=036P01.CPR DA= February 10, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: A letter requesting financing for several projects. Leonard Shendell is an investment banker, with several different firms, located in Dressher PA. A few projects were seriously considered. Esbestos contamination had ruined one deal. DI= ************************************************************* TI=\FMG, Ltd., BOARD MINUTES OF 02/11/87 IM=037P01.CPR DA= February 11, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/04/07/08 PA= PAGES: 2 SU= SUMMARY: Mr. Peter Hibbard is introduced by Robert Kauffman as a representative of Hibbard Brown, a broker dealer from Washington, D.C. Kauffman aggressively pursues a merger of FMG, Ltd., with Hibbard Brown. Stan Caterbone is skeptical of the deal. After decisions are made to accept deal, Stan Caterbone is dissatisfied with the performance and administration, visits with Hibbard Brown and demands the deal is rescinded. Stan Caterbone then flies to Atlanta, to do a deal with Koegler Morgan. IM=037P02.CPR DI= PAGE 2 DI= ************************************************************ TI=\FISHER/SPONOUGLE CO. REQUEST FOR FINANCINGIM=038P01.CPR DA= February 13, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/04/07/08 PA= PAGES: 1 SU= SUMMARY: Martin Sponaugle of Fisher, Sponaugle Investment Group, which is the owner and landlord for 1755 Oregon Pike, headquarters for FMG, Ltd.,. Marty Sponaugle had requested financing for several projects. DI= ************************************************************ TI=\BARRY SCHUTTLER RELIGIOUS ALLEGATIONS IM=039P01.CPR DA= February 13, 1987

AT= CORRESPONDING AUDIO TRACKS: 01/02/04/07/08 PA= PAGES: 1 SU= SUMMARY: Letter from Audrey, the administrative assistant for Barry Schuttler, of Barry L. Schuttler Associates, a satellite office of FMG, Ltd.,. Audrey will later disclose to Stan Caterbone that Pete Hibbard is also a "Born Again" Christian, along with To Turner, who as operating the largest financial services district for IDS/America Express, was reprimanded, and eventually left to join FMG, Ltd. This information gave Stan Caterbone the real reason behind the Hibbard Brown Deal.DI= ************************************************************ TI=\FMG, Ltd., ADVERTISEMENT IN LNP IM=040P01.CPR DA= February 22, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/04/07/08 PA= PAGES: 1 SU= SUMMARY: Full page advertisement for the Lancaster New Era, and the Lancaster Intelligencer Journal. Displays portrait of FMG, Ltd., professionals. DI= ************************************************************ TI=\FMG ADVISORY PA SEC RIA APP IM=041P01.CPR DA= February 24, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/04/07/08 PA= PAGES: 3 SU= SUMMARY: Letter from Paul Schwartz, Acting Director, Division of Licensing of the Pennsylvania Securities Commission. The letter acknowledges receipt of the application of FMG Advisory, Inc. for the status of Registered Investment Advisor, as submitted and prepared by Stan Caterbone. IM=041P02.CPR DI= PAGE 2 IM=041P03.CPR DI= PAGE 3 DI= ***************************************************************** TI=\OWEN KUGEL AND THE FBI INVESTIGATION IM=042P01.CPR DA= February 24, 1987 AT= CORRESPONDING AUDIO TRACKS: PA= PAGES: 1 SU= SUMMARY: Article in the Lancaster New Era regarding allegations of improprieties of the business activities of Owen Kugel Associates. None of the charges were substantiated and there was question regarding the merits of any investigations. FBI individuals have apparently been reprimanded for starting the investigation. The investigation eventually lead to a loss of investor confidence in Kugel, which in turned financial troubles. DI= ************************************************************

TI=\KUGEL FINANCE REQUEST IM=043P01.CPR DA= March 2, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/ PA= PAGES: 1 SU= SUMMARY: Letter from Owen Kugel to Stan Caterbone requesting financing for several projects estimated at $10 million in loan value. Owen Kugel was requesting both debt and equity financing. DI= ************************************************************* TI=\FMG, Ltd., NEWS LETTER RE: TURNER IM=044P01.CPR DA= March 24, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/04/07/08 PA= PAGES: 2 SU= SUMMARY: FMG Newsletter that included Robert Kauffman announcing that C.T. Turner (Tom) has joined FMG, Ltd., Tom Turner operated one of the biggest branches for IDS/American Express in Minneapolis MN. Tom Turner had legal problems due to his religious overtones while conducting business. Kuaffman also announces that FMG and Hibbard Brown & Co. have reached agreement on the pending merger. Coincidentally, Robert Kauffman, Peter Hibbard, and Tom Turner are all professed "Born Again" Christians. IM=044P02.CPR DI= PAGE 2 DI= ***************************************************************** TI=\FMG, Ltd., BOARD MINUTES OF 03/26/87 IM=045P01.CPR DA= March 26, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/04/07/08 PA= PAGES: 02 SU= SUMMARY: Board of Directors meeting discussing Hibbard Brown deal. Board agrees to meet on a regular monthly basis to facilitate the reorganization of FMG, Ltd.,. which Kauffman pursued in order to get equity and control to both Shcuttler, Hibbard, and Turner, his "Born Again" accomplices. Meetings were scheduled with Jeff Jamouneau by Stan Caterbone to discuss the reorganization. IM=045P02.CPR DI= PAGE 2 DI= ************************************************************ TI=\FSC VS. KAUFFMAN CONFLICT IM=046P01.CPR DA= March 26, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/04/07/08 PA= PAGES: 2 SU= SUMMARY: Formal letter from John B. Keeble, of Financial Service Corporation (FSC) citing the contractual

and fiduciary responsibilities of Robert Kauffman with respect to the recent request to terminate the licensing agreements of FMG, Ltd., and its registered representatives and to transfer the respective license agreements with Pete Hibbard's Hibbard & Brown and Company. FSC will take legal action against Kauffman and FMG, Ltd, if not resolved by April 1st, 1987. IM=046P02.CPR DI= PAGE 2 DI= ************************************************************ TI=\J. KEEBLE (FSC) LETTER TO ALL REPS IM=047P01.CPR DA= March 26, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/04/07/08 PA= PAGES: 01 SU= SUMMARY: A letter to all licensed representatives of FMG, Ltd., from John B. Keeble, Pres, Don Aultman, VP, and Steve Franklin, VP of FSC, outlining legal implications of Robert Kauffman's attempt at terminating his contract and transferring all Registered Representatives Licensed Agreements to Hibbard Brown, Broker Dealer. John Keeble also enclosed the recent letter sent to Kuaffman with regards to legal action, fiduciary responsibility, and contractual obligations. DI= ************************************************************ TI=\SEAPORT VILLAGE SYNOPSIS FOR POWER STATIONIM=048P01.CPR DA= March 28, 1987 AT= CORRESPONDING AUDIO TRACKS: 06/ PA= PAGES: 1 SU= SUMMARY: A description of the proposed real estate project by Tony Bongiovi and Bob Walters of Power Station Studios. Tony had requested that Stan Caterbone consider financing alternatives for the project, which included the refurbishment and development of an entertainment pier along the Wildwood Boardwalk, in New Jersey. DI= ************************************************************ TI=\KUAFFMAN LETTER TO REPS RE: FSC IM=049P01.CPR DA= March 30, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/04/07/08 PA= PAGES: 1 SU= SUMMARY: A letter from Robert Kauffman to all Licensed Reps of FSC, and affiliated with FMG, defending the allegations of John Keeble, and FSC, and alleviating any uncertainties with regards to transferring to Hibbard Brown and Company. DI= ************************************************************ TI=\KAUFFMAN LETTER TO J. KEEBLE OF FSCIM=050P01.CPR

DA= March 30, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/04/07/08 PA= PAGES: 1 SU= SUMMARY: A letter from Robert Kuaffman to John Keeble of FSC, outlining his defense against FSC's legal action concerning Robert Kauffman's contractual obligations and his fiduciary responsibilities.

Robert Kuaffman urges that FSC restrain from any course of legal action, because only legal representatives would make money. DI= ************************************************************ TI=\CLIENT COMPLAINT VS. BOB LONG IM=051P01.CPR DA= April 9, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/04/07/08 PA= PAGES: 1 SU= SUMMARY: A formal complaint lodged against Robert Long, accountant and Board member of FMG, Ltd., by a dissatisfied client. Bradley R. Singer of Conestoga Fuels complains about the work performed by Robert Long, and alleges the performance of FMG, Ltd., in delivering it's stated products and services. DI= ************************************************************ TI=\SONY STATISTICS DA= April 14, 1987 AT= CORRESPONDING AUDIO TRACKS:01/02/03/04/05/06/07/08

SU= STATISTICS FOR SONY DEAL Power Station l. Bon Jovi - Tony's creation 1% - $1 Million in l987 in Revenues

a. Format b. Mixing Sold 9 million albums in 6 months 2. Power Station - High Tech Award - Last 4 Years Best in World By Peers! 3. 4 - 5 Grammys in 1987 Recorded there Steve Winwood Others: Jagger,, B. Joel, Springsteen, Diana Ross, Madonna, J. Lennon, on and on. 4. Tony - Multi Track Recording Defied Theory Designed Sound - Voyeger Produced Star Wars Album - Mixed

5. French Lick - MTV may sign Free Promotion II. Technology 1. First Video, film, tv in digital. All first for full entertainment 2. Kodak and Mitsubish - Not till end of Decade 3. Dolby - Sony/PSDMS - $10,000 per license to any tv, film, video, etc., 4. Only mix board that will mix albums/video's Sell to all recording and film studios $300,000 - $500,000 per console. 5. Sony spends 9% of gross revenue on R & D 9% of billions 2 = $l80,000,000 6. Put Sony 5 years ahead of strategic plan Disc players - Only 23% of consumers currently own a disc player. First time to hear for how many? III. Film/Video l. 23,000 theaters to sell system 2. First will sell movie and video Add French Lick 3. Top Gun - sold 9 million @ $30.00 - $60.00 per video $270,000,000 + 4. Horror International Film $20 - $60,000,000 Pay TV, Cable, TV -- ? IV. Commercial - 180 Sec Commentary Sony - $4,000,000 - $8,000,000 for commercial Visa Demonstration $2 Million - $6 Million Pepsi Paid $8,000,000 60 Second in front of "Top Gun" video. V. Merchandise - Private Label Power Station Beach Line In movie, free by original designer and owner - "Hang Ten" swim wear Power Station Electronics Line/Sony Best recording in world - is it good? Beach Accessories Promotion in movie, video, TV Sell all of above Video - Mail Order, Stores VI. Sony

l. Needs help a. Low profits b. Beta Bust 2. Best name electronics Manufacture 3. Film and video distribution (new) 4. Willing to work together a. Share tech b. Joint venture c. Horizontal distribution 5. Horror Elements and P/S name already international Deal would involve: l. Retail electronics division 2. Professional electronic 3. Film distribution 4. Video distribution Star Wars - "STAR WARS BY LUCASFILM, Ltd., -- $2 Billion in 10 years

30% - 50% = $600,000,000 Tony said 50/50 All costs - $4 Million New - Film studio?/with Sony Deal worth 100,000,000 Now?? Would Kodak or Mitsubish like deal? Will Sony let this deal go to competition? No - Beta BUST!

PERFECT ENDING: Profits and Respect Creation - 4/11/87 11:00 - 1:00 a.m. Stan 98% 1% Scott - Call Ron Gell Research Sony 1% Marcia - Sony give 4 million Raise 15 Million Call Head of video distribution Merchandising - Hang Ten Off/Kodak /Sony Difference test visa add in DI= ************************************************************** TI=\KAUFFMAN CONGRATS TO S. CATERBONE IM=052P01.CPR DA= April 13, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/04/ PA= PAGES: 1 SU= SUMMARY: Congratulations letter from Robert Kauffman to Stan Caterbone on his commissions of $86,466.11 for the fiscal year ended March 30, 1987. FMG, Ltd, had accumulated $815,000 in Gross Commission Income (GCI) for the first quarter, which can be extrapolated to

approximately $3,260,000 in annualized commissions. Historical statistics indicate that financial services companies are often valued at One (1) times GCI or $3,260,000 by Industry standards. This would value the 250,000 of stock at $13.00 per share. DI= ************************************************************ TI=\BOARD INVITATION TO SATELLITE DIRECTORS IM=053P01.CPR DA= April 14, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/04/07/08 PA= PAGES: 1 SU= SUMMARY: Letter from Robert Kauffman to the Satellite affiliates of FMG, Ltd., inviting them to the Board of Directors Meeting to be held at Dempsey's Restaurant, Lancaster, on May 5, 1987. Agenda includes update of FMG, Ltd., Profit Participation Plan, Restructure of FMG, Ltd, to include national expansion, and private syndications. DI= ************************************************************ TI=\FMG ADVISORY BILLING IM=054P01.CPR DA= April 21, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/04/07/08 PA= PAGES: 1 SU= SUMMARY: Memo to all affiliated persons of FMG, Ltd,. regarding the billing procedures for the Registered Investment Advisor, FMG Advisory, Inc., which Stan Caterbone is President, and for FMG Accounting, of which Stan Caterbone is responsible for the daily operations. DI= ************************************************************ TI=\FMG, Ltd., NEWSLETTER 04/14/87 IM=055P01.CPR DA= April 14, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/04/07/08 PA= PAGES: 3 SU= SUMMARY: A FMG, Ltd, Newsletter to all affiliates of FMG, Ltd., Stan Caterbone updates his activities and the status of the following: Insurance carriers and business; Registered Investment Advisor, Retirement Planning Computer Analysis; Bennet Williams Real Estate Project and Syndication; Mortgage Banking Activities and the Availability of Financing and Loan Packages with a range of $3 million to $500 million and competitive rates IM=055P02.CPR DI= PAGE 2 IM=055P03.CPR DI= PAGE 3 DI= ************************************************************ TI=\FMG, Ltd., BOARD MINUTES OF 04/16/87 IM=056P01.CPR DA= April 16, 1987

AT= CORRESPONDING AUDIO TRACKS: 01/02/04/07/08 PA= PAGES: 2 SU= SUMMARY: Board of Directors Meeting held at the offices of McNeese, Wallace, & Nurick, Harrisburg PA. The agenda was the restructure and reorganization of FMG, Ltd,. with specific regards to Pete Hibbard, Barry Schuttler, and Tom Turner ("BORN AGAIN").

Shareholder vote within next 30 days for the following: Formation of FMG National Inc.,; Directors Liability; Exemption of By Laws of Above; Closing Current Offering Memorandum; a 5:1 Stock Split. IM=056P02.CPR DI= PAGE 2 DI= ************************************************************ TI=\USEPPA PROJECT CORRESPONDENCE IM=058P01.CPR DA= April 29, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/04//07/08 PA= PAGES: 1 SU= SUMMARY: Letter from John Klemish regarding real estate investment on Useppa Island, Pinnland, FL. DI= ************************************************************ TI=\MAY 2, 1987 FMG, Ltd., MEMO TRANSCRIPT BY S. CATERBONE DA= MAY 2, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08

SU= {THE FOLLOWING IS THE AUTHENTIC TRANSCRIPT AS TRANSCRIBED BY LYNN KREIDER OF FMG, Ltd., ON OR ABOUT MAY 10, 1987.}

The purpose of this document is to recollect all activities that I've been involved within Financial Planning and the formation of Financial Management Group, to verify and document some of the activities that I've been involved in to date. I'm afraid that as we go further and further there will be a need for such information especially with what has happened this past week with our corporate officers and board. First I would like to begin back in the very beginning so that the full scope of our activities seem to fit into one place and also so that some of the issues that have come up are tied into what has happened up to this point. First of all, I started in the Financial Planning Industry back in 1982. After getting out of the contracting business I took six weeks and traveled across the country and came back and decided to get into the financial services industry. Being that several relatives have had dealings with IDS, Investors Diversified Services, I called the local branch in Rohrerstown upon finding the manager named Robert Kauffman. Bob spent some time with me, decided he wished to hire me, and that began the process. I was actually licensed in 1982 for securities and life and was put

under the management of Bob Kauffman. Shortly thereafter, I would say probably in June or July, Bob was promoted and took a division in Tampa, Florida. Myself and three or four other individuals who were under management decided that we wanted to form a group together so we talked to another district manager, Steven H. and decided that, if he would allow, we would like to put an office together with him. At this time we did not have an office and he was working out of a small office in Millersville. The people who were with me was myself, Mike Hartlett and Alan Loss. The three of us were very, very large producers, especially Mike and Alan. The three of us were probably larger than Steve's district at that time, so at that point we located an office at 255 Butler Avenue, we walked under Steven H. district which increased his income by at least 30% to 40% upon that transaction. After being involved in the business I decided that financial planning should be more objective and fee based, so I became one of the larger fee producers using fees as well as commission income. At about the same time, I became involved in the International Association of Financial Planners. At that time the local chapter was just being formed and I volunteered my services to help on the board. Members of the board, at that time, was just being formed and headed by John Herr. I became executive vice president and virtually helped run the chapter and helped build it to its largest membership. That gave me the opportunity to meet other people, broaden my horizons and education as far as the financial planning industry and just how the independent planners fit into the stream of the industry. I had quite a bit of activity and did a lot for the local chapter and became very involved. Over the next several years I made a very good living. I was never a very big producer, although one of the bigger ones in the Harrisburg division. But I was not the biggest, but the premier fee producer for the division and was one of the leading in the country at that time. I shortly became knowledgeable of the other products available in the financial services industry and learned very quickly that it was virtually impossible to have one company manufacture and produce competitive products across the line. At this time I was setting up a dinner meeting for the IAFP that was going to showcase Alexandria Armstrong who was one of the premier planners in the country. She was very visible and very widely known. I set up a dinner meeting for her which attracted close of one hundred professionals and other people to attend. This was four or five times larger that any other meeting the chapter had ever had. After the meeting I was involved in a discussion with Alex regarding the financial planning industry and my aspirations of what was outside of a propriety environment. I told her that I was thinking of making a move and asked her if she had any suggestions of who to speak to. At this point in time, we were all in Butler Avenue and Bob Kauffman was in Georgia, running a division of IDS back there. He, at this time, had become one of the largest divisional managers and had shown very high

productive recruiting skills. He was running one the largest shops in the South East and was becoming very profitable for IDS. Alex suggested that I call a gentlemen by the name of John Keeble who was then president of Financial Services Corp. a broker/dealer based in Atlanta, Georgia. At this time Bob Kauffman was probably, as unfamiliar if not more unfamiliar, of the independent environment available to the Financial Services Industry. Specifically Financial Planners. I phoned Bob and told him that I was going to look and see what else was "out there." Before this time, a couple months prior, I attended a career conference in Florida with IDS. At one point I was in a room with Bob Kauffman and Tom Turner, who was the biggest divisional manager at this time with IDS. I began to discuss my dissatisfaction with the company and the way that they operate and I suggested to them that it probably would not be too difficult to duplicate an organization instead of being built around a proprietary system built solely around a non-proprietary product. At the time they both looked at me and I don't remember if they laughed, but the idea really didn't really interest them, and it just rolled off their shoulders. Right after this meeting is when I had the dinner meeting with Alex and I set up the meeting in Atlanta. As I usually did, I always looked at Bob Kauffman as my mentor. He virtually took me off the streets and showed me a way to produce money in a way that I never dreamed I could produce. I always respected Bob as a very good salesman, seeming to have a very high financial intellect and I looked up to him as he taught me a lot. So I got on the phone and told him I was going to visit an independent planner in Atlanta. At this time, Bob was becoming dissatisfied with the management of IDS and was not very happy with the way they were using him to build areas. When the areas would become profitable to him they would move him to another distressed area to be built up. So he was doing all the work and IDS was making all the money because they would put in a manager for less money and so on and so forth. Bob then told me that he may be willing to go into the meeting with me under the assumption that I did not tell them who he was or who he was with. I called John Keeble and told him I wanted to come down and visit him, being referred by Alex and he was very nice over the phone, giving me a cordial invitation to come down and actually had me set up the meeting with Ray Smith who was one of the sales managers. I set up a two day meeting with myself and this anonymous person, Bob Kauffman. We spent two days at FSC and what essentially happened is that they became infatuated with Bob's recruiting skills. On the spot they offered Bob a position within the company as far as recruiting and head of sales management of FSC. I resigned from IDS January 1985. Bob remained at IDS and from October to March was negotiating his position and pay and his compensation with FSC. By March he actually decided to resign from IDS and he was absorbed into the corporate structure of FSC. January 1st I resigned from IDS. I was upstairs with Mike Hartlett, sharing an office space and the rest of district with Alan Loss was still downstairs. At this time, I began to build my independent practice of Financial

Planning. Basically I took 95% of my clients from IDS and began working with them. Bob began working in the national recruiting for FSC and started attracting IDS people to FSC. By the Fall of 1985 I had became disappointed with my business life, not learning enough, lonely being independent and I became frustrated. I knew that no one in Lancaster was doing a very high quality service regarding Financial Planning and Financial Services. To me, Lancaster seemed to be a highly attractive market with a lot of wealth being spread out among a lot of different players. No one was being creative regarding their efforts it was just three or four brokerage houses, insurance agents, banks and independent planners but no one had a very strong position or dominance in the financial services industry. I visited with Bob Kauffman in the Fall of 1985 as I usually did every couple months and told him I wished to do something else. At that time he asked me if I wanted to come down to Atlanta and help him work on the concept of company owned shops. When I was down there, he mentioned several positions in the corporation that I may be interested in and he set up a meeting with me and Steve Franklin. Steve apparently needed someone to manage his national sales office so being down there I spoke to him, just to verify what was available. At this meeting, Steve Franklin more of less indicated that I was a "burned out salesman" who was just looking for a place to go. Nothing ever happened and I left the meeting with very little respect for Steve Franklin. Bob offered me a position within his company owned store, writing cases doing plans, doing some other things. That was early October. For the next three or four weeks I prepared myself, reluctantly, for the transition and moved to Atlanta and tried to maintain clients up here as well, and pursue whatever Bob was doing down in Atlanta. As time went on I felt I really didn't wish to move away from the area and that maybe the opportunity down there wasn't what I thought it was, or wasn't what Bob said it was.

On November 27 or 28 of 1985, I had a meeting with Bob Kauffman and Mike Hartlett at Morton's Restaurant on the Rohrerstown Road, Lancaster, PA. The purpose of the meeting was to find out if we could collectively put together something in Lancaster with regards to financial planning. I would say that meeting was more of an effort on my part than anyone especially Mike Hartlett. Mike was, at this time, also independent, left IDS and followed me to FSC along with Bob. The meeting was on the morning at 9:00 a.m. and we discussed what options we had as far as putting something together in Lancaster. I guess the basic reason for the meeting was to see if Mike Hartlett wished to do something together with us. At this time I was operating my practice, Mike was operating his practice, and the only thing we had in common was a reception room adjoining our offices. At this time Bob saw that if we could put something together in Lancaster he could probably fulfill some of his recruiting requirements, giving him

a place to actually recruit people to rather than using FSC in Atlanta. So that began the process of putting together a shop in Lancaster and Central PA. I began to recruit from that point forward into our so called planning firm. At this time the planning firm was going to be comprised of financial planners. Some of the first people that I talked to was Mona Rishel, Dick Sherbahn, and Bob Long. I spoke to other planners about joining our firm and then I got the idea of adding other professionals mainly legal, accounting, real estate and maybe insurance. It was then that I got the idea for the one stop financial firm. To me it seemed apparent that it was important to have all the individuals working together collectively to manage one financial affairs. It didn't seem that difficult to accomplish that if you had the right individuals willing to take the risk of attempting such a project and who had the clientele where they didn't have to rely on attracting new clientele. Well, one thing led to another and we soon began to recruit and attract new and sizable group of individuals. I probably was responsible for recruiting 90% of the local people and outside people, Mike was working with Rick Volpe in Philadelphia who he worked with at IDS, and a host of others. The initial core was myself, Mike, Mona, Dick Sherbahn. At this time I ran into Scott Robertson at the Three Mile House who was working with Asset Management. I expressed the idea to him and he became interested and became one of our people. I also talked to Carolyn Royer who was with Pru Bache and she was interested in joining. By February we had a fairly large group of people who were willing to commit. First thing we had to do was find facilities and Mike found the place available at the Oregon Pike location which was just under construction. At first we were looking for 2,000 square feet to house four or five individuals. At this time I talked to Tim Lanza, people at -----------the legal firm, and Danny Berger as far as doing something with real estate. It was supposed to be an operation financed and supported by FSC. From December until May FSC was promising fund to finance the operation. We needed start up funds for furniture, computer systems, salaries for myself and Mike for managing the operation. What happened during this time was that FSC was constantly promising us financing and we had yet to receive any actual money and the invoices submitted were never paid by FSC. Bob Kauffman was the liaison and apparently was being directed by Steve Franklin and John Keeble. From what I have learned over the past several years was that they never really intended to finance the operation but they were stringing us along and using us to recruit other people to the operation. After we recruited ten or more people it became apparent that Mike or myself did not have the managing skills required to manage such an operation. We also learned we lost our financial backing, so we had to figure out what to do with financing. At this time we decided to raise the capital ourselves, finance the operation ourselves with equity we raised through the planners. And essentially we learned that no one in the industry, or very few actually own their own business but are only a distribution for a financial product.

We all have seen broker/dealers being bought and sold for very sizable amounts of money, usually in the vicinity of $l of equity for $l of gross commission income. We began to see that we were seeing anywhere from $l million of gross commission income per year with the group that we had. In the group was Ken Ray and some very creative and talented people. Throughout our meetings and discussions which were very long, durable and tiresome. From December to May I probably spent every other evening with Bob in Atlanta trying to put this deal together.

Let me go over a couple of other things that had happened up to that time that I'd like mentioned in this document, before I forget. Back in the summer of l985, I was contacted by John Philips from Blue Ball National Bank. Because of my visibility with the local chapter of the IAFP John wanted to call me and look at the options of Blue Ball National Bank become involved in Financial Planning. John called a meeting with me and I believe he was looking for someone to head a Financial department with inside Blue Ball National Bank or contract with someone outside. I had l-l/2 hour with John and his subordinate, whom I can't remember his name, I believe it was Joe. He was the vice president of the trust department, I believe. Anyway after the meeting they did not have the faith or the confidence that I was the right person or they didn't believe that this was really what they wanted to do. But I have never heard from them since. Fall of l985, before our initial meeting, after I decided that I was not going g to relocate in Atlanta, I began to look for other options in Lancaster. One of those were that a couple people put me in touch with several banks. One was Joe S. with Commonwealth National Bank and another was Meridian Bank. Both of those individuals received phone calls from people I did business with stating that I was looking for something and asking that they give me an interview. None of them would even give me an interview. I received a letter from Commonwealth stating that they had no positions open at this time, but they would keep my name on file. From Meridian, I don't believe I even received a letter. This is one of the reasons that I don't have very much respect for banks, or people who work in banks. I don't wish to dwell into this subject, but because of several of these episodes I just don't have much respect for bankers, or banks what so ever. During this time that I was looking for something to do, I had a meeting with Owen K. Owen K. was looking for someone to raise his equity for his rehab projects and his syndications. I had one meeting with Owen and one with Ed Pontius and apparently they hired someone who essentially what happened is that Owen ran into a lot of trouble and a few months ago I was given Owen's name and he wanted me to raise both debt and equity for him. Whereas one year ago he wouldn't even continue any conversations with me. I believe this gives you an indication that a lot of the people in this community are very close minded and narrow minded and unless you are a member of the Country Club or the Hamilton Club, or unless you come from a family of wealth, you don't receive very much attention or consideration and you are really just another person on the street. Most of the people in this community whom I am referring to do not have the business

savvy to be able to detect opportunity when they see it. I would like to talk about the division of labor between me, Mike and Bob before I get to far into this. First of all, I was probably the mediator or negotiator with putting the deal together. I was the middle man. I was in touch with Bob and Mike and those two were not in very close communication with each other. I was also giving Bob the conceptional outline for the project and he was in Atlanta finding the details, such as financial planning software. What I soon learned was that because of Bob's management capabilities and because he has been in management for so very long he really didn't have the technological expertise about the business. His expertise came from other people so it was always second and third hand and essentially what happened with a lot of the issues I had to go back and retrace and research myself trying to get the accurate information as it was second and third hand before it got to Bob Kauffman's hands. The division of labor was that Bob was to be the president of the organization - he was to be the manager. Mike was going to be the chief financial officer, and help with a little recruiting and help with the staff. I was going to help negotiate, recruit - I guess I was intended to be a lot of things. However, I can't remember precisely what at this time, but I virtually had my hands in all area. One of the things that I recognized early on was the necessity to have Bob Kauffman actually come here and manage. When we started, Bob was supposed to stay in Atlanta but when we started to get into substantial size, I would not or could manage and I don't believe Mike could. The only way I would do the deal is if Bob came up here and managed. Bob was going to be president and in the negotiations it was very difficult because both Bob and Mike didn't want the other getting more than themselves.

I was always in the middle always giving more than getting and what ended up is for Bob to come up here he had to have more; he had to be president. With three people involved, I agreed on this because to get three people to agree on issues is almost impossible. You need one person to make decisions, and we decided to allow Bob to have this capability. Bob was going to receive 60,000 shares, I was to receive 40,000 shares and Mike was to receive 40,000. Also, Mike and I were to receive $3,000 per month and Bob $5,000 per month. Bob and I had a deal as I did not believe he should have more of the company than I because I put it together. We had an agreement whereby I could buy 10,000 shares of his 20,000 at anytime at cost so we would both have 50,000 shares. I had papers drawn up to that, however, when we began to have problems, I left things drop by the wayside. Back in February 1986, I became good friends with Mary Lynn DiPaolo, Kevin's sister and Mike's wife. We were always good friends, but back then when Kevin left, we became very close because I spent a lot of time with them. Mary Lynn was at the time, 30 years old with three children, and she was always very tied down with the kids, basically a housewife. She never really had a job, never worked. It was hard for her because most of her other friends were out working and had careers. I asked her if she would like to help me out for a few hours a week doing general clerical and typing. She was very excited. I

thought it was a chance for me to get some things done and I liked Mary Lynn a lot and we got along and I thought it was a chance for me to get a few extra things done. I took her on in February and before too long she was working 30 hours a week. She had a babysitter lined up for the kids, and it was very encouraging for me to see her do this because it gave her the confidence for the first time that she could do something other than just have children. She was having a great time and I was having a great time and we enjoyed working with each other. At that time, Bob invited Mike and I down to the annual conference in Tucson, Arizona and with the conference arrangements we were allowed to take someone, such as your spouse. I asked Mary Lynn if she wanted to go and I don't believe she was ever on a plane before and she asked Mike and he said it would be good for her to meet some of these people and get involved with a career. We ended up down at Tucson and that was in April 2 and we spent four or five days there.

Upon meeting Bob I told him I was bringing Mary Lynn out and I knew from the start that this was a sore spot. First of all she was married and he couldn't understand what she was doing out there with me. Second of all he didn't appreciate the whole situation when he met her he said something to the effect that she looked very young. After the second day we were all good friends and she was getting along very well with Bob and Pam. In fact, Pam confided things in her that I know Pam never told anyone. It looked as though they liked, or at least pretended to like Mary Lynn and so anyway we all had a good time. Bob, myself, and Mike spent most of our time in individual private meetings trying to put this deal together and work out the details especially with FSC. I think it was back at this time we realized that Bob was probably going to resign from management and commit and come up to Lancaster. I think one of the reasons why Mary Lynn and I became very close was that she reminded me so much of my mother in the way that she handled her kids, family and I became infatuated with that. I liked her a lot. What happened was that Mike and Bob resented the fact that we had so much fun while we worked. We got work done, but we went out to lunch for an hour or so and we really enjoyed things. To them that had no place in business. For me, as long as I got my work done, I felt better about my work and it worked out for the best. This was a problem and will come up later. During the Spring of 1986 when we were putting this together I had the opportunity to move across the hall and get additional space from another tenant. I was going to sub-let. I did this so it would give Mike and I additional space and give operations more space so we could get additional people before the people was done. I moved into 12 by 18 office with reception room and I had 3 or 4 additional offices. Nancy was working for the tenant that I was subletting and she didn't have a job and she asked me if there was anything she could do. Mike wanted to hire her and I said let's just try it part time with no commitments on either side to do anything permanent when we move in and she began part time. So we now had Mary Lynn, Nancy and Nancy A. That was the beginning of the staff problems. The staff was always going to have staff problems in the beginning and I can't

exaggerate the problems that we had. We had so many different personalities, three different principals, trying to give their input. So far as the staff was concerned, mine never counted at all. Its funny, they always considered my input for everything else, but when it came to staff - no way, hands off. I resented this because first of all I brought Mary Lynn in and second of all I think I had a better vision as far as the people than Mike did and that will come out in the future. Mike wanted to hire Nancy M. as office manager and I didn't think she had the qualities to do such a job and I wanted them to interview Barbara Kinzer. Barbara was a teacher of mine back in high school, teaching business, typing, clerical, later going on to work at Watt and Shand in employee benefits. So it just seemed to be that she had some of the qualities necessary to do a good job. They interviewed her and they didn't like her because I brought her to the table. They ended up employing Nancy as office manager. That is going to have a lot of problems. I believe Nancy could have been a good employee in the right situation, but they apparently didn't see what they should have - that they weren't organized enough to have an office manager. I suggested early on that we not have one and that Mike do it himself rather than us having an additional layer, not necessary. As far as the staff are concerned, I wish to finish up the story on the staff all at one time. It was understood that none of us were to have our own personal secretaries which meant Mary Lynn was not going to work for me and Nancy A. was not going to work for Mike. I didn't agree with that, but they were dead set against having Mary Lynn involved. Part of this was because Mary Lynn meant so much to me and they saw that as competition in a certain way. Mary Lynn's personality is very outgoing, a very verbal type person who is very personable and they didn't like that. It was to be understood that we were not to have our own girls. We moved into the building, they would not allow Mary Lynn to be back in my section, however, Nancy A.'s desk was right smack up against Mike's door. This started all the problems with Mary Lynn. She saw that and she wished to work for me, and they were not tremendous impact on the relationship between me, Mike and Bob. This was the straw that broke the camels back as far as our relationship was concerned. Ever since that happened we stopped communicating. That was the first move in trying to rescind my input and my control so far as the company was concerned. As far as the staff was concerned they had a feeling that the staff should be treated as dirt and made this understood many times to me - this is against all my philosophy of life. For months, because of this attitude, there were problems with the staff. It was because of this that the staff didn't respect them, and it was just a mess for months. During June, July and August, Bob was still down in Atlanta and I was doing most of the work in Lancaster. From January until January I took one day off for Memorial Day, one day for July 4th, one day for

Labor Day and one day for Thanksgiving. Mike Hartlett took off two of three weeks, leaving me to tend the shop. I was always the one doing all the work, recruiting, stock offering,labor matters, drew up all the contracts, drew up the offering memorandum with the help of the attorney. It was funny that I was the only one raising the money - probably 80% of the funds. I was the only one of the principals who had outsiders investing in the company. The most they did; Bob Kauffman raised $5,000 from his father in law, so not only did I put my own money in I risked that of my clients. But they were willing to accept that up front. A couple times it came down to either me getting the money from my clients or us not having the financial ability to pay off some of the capital resources that we had. During September we began to have problems with Mary Lynn and the staff and me. This was the beginning of them trying to reduce and dilute my control of the company as far as input was concerned. It was a very emotional and draining experience after all the work I did to put this all together to find those two were trying to push me out. It reached the point in October or November where they actually asked me if I wanted to "get out." They indicated that I was not right for management, management was not right for me, that I wasn't having fun and all this and that. Most of that was due to their action as far as their trying to dilute me and weaken my confidence. They constantly made fun of me in front of all the other planners at meetings and it was just ugly.

They also tried to interrupt my relationship with Mary Lynn which was nothing more than a very personal, deep friendship. No one knows this, but the trauma was so heavy that I went under the care of a psychologist at St. Joseph Hospital, beginning November and I was suffering a severe case of depression. Because of schizophrenia being found in my family, I was not afraid to go seek psychological counseling. I was on medication for three months. In September they had it in their minds that they were going to get rid of Mary Lynn. And they tried every opportunity, finally in November a week before Thanksgiving, they fired Mary Lynn. Without cause, for no reason, other than they just wanted her out and felt she was incapable of whatever. It actually reached the point where Bob and Mike went around politicking the brokers to support them that Mary Lynn was not doing her job which was not true. She had the complete support of all the brokers. Maybe at times there was a case where someone was unhappy with her performance, but in general it was a ploy, a plot, fabricated by Mike and Bob. After their attempt to buy me out and get rid of me so far as my control and my interest, I held out reluctantly often times wondering if I were going to give in and by Christmas I decided I would stick it out. There were not other alternatives, but the money they offered me to get out was $2,50 a share which comes out to $100,0000. I wanted no parts of it, so by January I decided to stay. Bob had several conversations with Bob Long saying that he was worried about my entrepreneurial efforts and that I was becoming slack. The whole reason was that they were hammering me down and beating me up in every way they could, destroying my confidence. After

I spent time and effort and I believed in so much of what I'd done, and they were trying to take this away from me and get me out of the picture. Through November and December there were meetings between myself, Scott Robertson, Alan Loss, Bob Long and Carolyn Royer regarding the activities and the management styles of Mike and Bob. They were very concerned, were not very trusting and I was always in the middle between the management and financial planners. I had relationships with everyone and I believe that this threatened Bob and Mike and they tried to get me out of the picture, but the planners would not allow this because the planners did not trust Bob and Mike without having me to keep them on balance. I raised most of the money, recruited most of the people, put the offering memorandum together, put the computer system together, worked with all the computer software, and actually came up with the name Financial Management Group and the idea of having all the subsidiaries doing different things. My involvement was very deep, probably deeper than anyone in the organization. When I was putting all this together, I was in Texas with Al Dannat. I talked about having mortgage, banking a part of what I was doing. Nothing ever happened between the two of us, but in January I received a call from Al asking me to see if I could place any mortgages in the east coast. He was willing to pay me roughly one half a point and this was at a time, because of the activities of Bob and Mike, that I thought I would give this a try to give me some security. Should something fail in the company, I would have something to fall back on. I involved Scott Robertson and Bob Long and I told them we would form a three way partnership and we would work on a real estate project on our own. The reason I told no one about this was that this was my ace card in case Bob and Mike ever really threw me out. I was not going to give them any relationships, and I just needed some security. What we were really doing was looking for loans of 2 million dollars and up to refinance or finance new and existing real estate projects. We made a few calls, finding that our rates are very competitive. Al was more of less letting me get plugged into the major Savings and Loans and Insurance companies. We found out there were very few people in the area, if any at all who could acquire the terms. We began having a great deal of success and what we found was that almost everyone was allowing us to bid on their project. We created a company called Creative Finance Company so that we would not expose FMG to any liabilities as far as our activities. We agreed from the beginning that FMG would receive a percentage of our activities and we figured 15% was fair since we actually manufactured the product where FMG when out and used other manufactured products. We didn't feel they were entitled to a 20 - 30% split. One of our contracts was with Tony Bongoivi in New York. He at one time dated Scott's sister approximately ten years ago. Scott maintained a loose relationship with Tony, calling him once in a while regarding business matters and business activities. Scott called Tony one day about a real estate project that he thought ---------------. Tony said no, but he may have another project that we would be interested

in. Scott asked me to go up to New York with him to talk about the project and I asked what it was. He indicated it was a movie. I was very reluctant and hesitant to do this because movies to me, tax shelters, scams, not very economic type investment. Me being very conservative was not attracted, but I decided to go anyway just to get out of town, more or less just to get away. When I got up there I was totally amazed at the caliber and the people who we were associating with. What I found out was that we were working with the leading recording studio in the world. There credentials, their accomplishments were phenomenal- they were just it. I'm not going to spend a lot of time of this because just the bottom line is what is important here. After seeing the project when I looked at what Tony was doing, and from a business perspective there were just so many elements in this project that were just truly amazing to me so far as distribution and marketing and risk and everything else. Bottom line was a product that was worth 15 to 20 million dollars being made for 4 million with the ability to be one of the leading movie, video projects of the years. First of all you have the leading recording studio in the world working on the sound for the project that was going to include a follow up of Tony's previous band who was Bon Jovi who was already one of the hottest thing in music as far as album sales. Then you have the fact that he was going to digitize the recording which was never done before in the movie industry at a time when the video market is just going bananas. Not only that, but the label that signed the band owns MTV. You put all this together and you've got a phenomenal business with a lot of opportunity. Seeing this, I committed myself to the project not knowing who, where or how we were going to raise 4 million dollars but I believed in the project so much. I guess because I saw a lot of the same elements used in FMG in this project, and even more. I got instincts when I raised money for FMG I was still very concerned with the risk elements to my investors but when I looked at this project the risk was even less. Less risk, more protection with this project so I believed in this project. We spent seven or eight weeks developing the packaging the product for the investors, things have happened during that time that fell into place perfectly - the article in Rolling Stone, the marketing. It is May 4th at 4:30 a.m. and there is no doubt in my mind with the articles in Rolling Stone that we have the money for the movie. That project in itself will probably put us in the forefront of the entertainment industry within eight weeks. It is mind boggling as far as what can come of this, but the project is done, we did something, we did not use FMG, they will receive no split. I guess what I'm saying is that because of the way Bob and Mike treated me or pushed me to go out and do things, that did not involve FMG and I did not feel that they did not deserve to become a part of these things. From the beginning I knew FMG was going to get their piece. Let me go back to an earlier development concerning the Broker/Dealer. We of course thought in the beginning that we would

become our own broker/dealer. However, after long, hard discussion, we were to the point of getting a license for broker/dealer, we decided we did not have the administrative capacity to fulfill what we would need to accomplish the broker/dealer. Back in November, December, Bob started soliciting other broker/dealer, looking for three things; service, high pay out, and equity. We knew that we had to own our broker/dealer business. There were two players that we came across one was Hibbard- Brown out of Washington DC and the other was Financial Planners Group which really involves some of the premier financial planners of the country, Bill Keogler, Wayne Webster, so on and so forth. The Keogler group was strong, large, young and they were doing roughly 20 million dollars of gross commission income per year but there were some people in the organization we did not feel comfortable with. Hibbard Brown was a new start up, starting up when we did, was a split from a previous broker/dealer in D.C., that involved from a syndicator to a broker/dealer that no one knew anything about. However, they really enticed us with a very attractive equity deal. Bob maintained most of the communications and most of the research involved in this project. It was brought to us in January which was roughly 20% of their stock with 90% payout , territorial with override for anything that we did. One of the things I thought should be done is that someone should be down there looking at their trading department, along with the capability of FSC. I tried to get people down there several times and I suggested Carolyn Royer because of what had happened to her. Finally Peter Poneros and Ken Ray went down, and this was probably during March. Anyway, this whole thing was done with very little communication as far as me, Bob and Mike. More of less, Bob would go out and do something and would feed back to us, but we really had very little involvement with what we intended to do with Hibbard Brown. One thing Bob indicated was that if we went down to Hibbard Brown we would not find much, they were just starting up, they were new, they had roughly 10,000 sq. foot of office space, a few staff people and the system of operation. He did feel they were capable of fulfilling our needs. We began the transformation of licensing from FSC to Hibbard-Brown and we probably had 60% to 70% of the in house people to FSC, Alan Loss, Scott Robertson, Rich Braverman, Keith Waters, Todd Dellinger, Harry Radcliffe, along with Barry Schuttler and some of the other satelites. At this point Tom Turner was free and clear and he was looking for some direction. By the week of April l9th Tom was up visiting with Bob all week seeking that direction and he was also visiting with Hibbard Brown so it looked like Tom would also become involved. I also negotiated the courtship of Tony Pascoti and got him involved. From the period of April lst on, when we began transferring license, one of the main ------------------------------- THE END! IM=059P03.CPR DI= PAGE 03 IM=059P04.CPR

DI= PAGE 04 IM=059P05.CPR DI= PAGE 05 IM=059P06.CPR DI= PAGE 06 IM=059P07.CPR DI= PAGE 07 IM=059P08.CPR DI= PAGE 08 IM=059P09.CPR DI= PAGE 09 IM=059P10.CPR DI= PAGE 10 IM=059P11.CPR DI= PAGE 11 IM=059P12.CPR DI= PAGE 12 IM=059P13.CPR DI= PAGE 13 IM=059P14.CPR DI= PAGE 14 DI= ************************************************************* TI= FMG, Ltd., BOARD MINUTES OF 05/05/87 IM=060P01.CPR DA= May 5, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/04/06/07/08 PA= PAGES: 3 SU= SUMMARY: Stan Caterbone updates activities of following: FMG, Ltd., and convenience industry; Mortgage Banking Business Activities and Availability of Funds; Movie Project w/Tony Bongiovi & Power Station; FMG Advisory, Inc.; and the Insurance business; Ken Ray and Jere Bavero report problems encountered at Hibbard Brown during visit. Barry Schuttler ("Born Again") "NO PROBLEMS". IM=060P02.CPR DI= PAGE 02 IM=060P03.CPR DI= PAGE 03 DI= ************************************************************ TI=\GAMILLION STUDIOS OF HOLLYWOOD REQUEST FOR FINANCING IM=061P01.CPR DA= May 6, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/04/05/06/07/08 PA= PAGES: 2 SU= SUMMARY: Letter to Financial Management Group, Ltd., from Marcia Silen's (Producer of Flatbush Films) Becky Austin, requesting financing assistance for Gamillion Studios of Hollywood CA. Stan Caterbone meets with Ted and Mary Gamillion in Hollywood CA, to discuss financial alternatives, and leaves with several documents pertaining to subject. Stan Caterbone also meets with Becky Austin to discuss mortgage and investment banking business in Hollywood CA.

IM=061P02.CPR DI= PAGE 02 DI= ************************************************************ TI=\HAMILTON LIFE SOLICITATION IM=062P01.CPR DA= May 12, 1987 AT= CORRESPONDING AUDIO TRACKS: 07/08 PA= PAGES: 1 SU= SUMMARY: Letter to Stan Caterbone from Alexander Hamilton Live soliciting a contract for various insurance products. DI= ************************************************************ TI=\FMG, Ltd., BOARD MINUTES OF 05/13/87 IM=063P01.CPR DA= May 13, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/07/08 PA= PAGES: 5 SU= SUMMARY: Board Meeting set by Stan Caterbone to rescind the deal previously consummated with Hibbard Brown & Company. Stan Caterbone refused to let the relationship of Robert Kauffman and Peter Hibbard compromise the financial and legal well being of Financial Management Group, Ltd.,. By overturning the recent Board Decision, Stan Caterbone had for the first time gained complete control of the Board of Directors, of which will motivate the further criminal actions of Hartlett/Kauffman/Peneros/Long/ Robertson. Stan Caterbone later visits with Bill Koegler IM=063P02.CPR DI= PAGE 02 IM=063P02.CPR DI= PAGE 03 IM=063P04.CPR DI= PAGE 04 IM=063P05.CPR DI= PAGE 05 DI= ************************************************************ TI=\KENNEDY PROPERTIES REQUEST FOR FINANCING IM=064P01.CPR DA= May 6, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/04/07/08 PA= PAGES: 2 SU= SUMMARY: Letter to Stan Caterbone from Kennedy Property Corporation, of Turnervill NJ, requesting for financing and mortgage assistance for several projects. IM=064P02.CPR DI= PAGE 02 DI= ************************************************************ TI=\BENNETT WILLIAMS PRELIMINARY SYNDICATION PROPOSAL IM=065P01.CPR DA= May 11, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/04/07/08

PA= PAGES: 7 SU= SUMMARY: Letter and preliminary draft of the proposed deal for the syndication of an office building for the headquarters of Bennett Williams, as anchor tenant, and a financial services center. Stan Caterbone will later propose the deal to Dave Cook, of Turkey Hill Industries, who is very much interested in deal, and has done business with Dave Schadd in the past. IM=065P02.CPR DI= PAGE 02 IM=065P03.CPR DI= PAGE 03 IM=065P04.CPR DI= PAGE 04 IM=065P05.CPR DI= PAGE 05 IM=065P06.CPR DI= PAGE 06 IM=065P07.CPR DI= PAGE 07 DI= ************************************************************ TI=\BENNET WILLIAMS FINAL SYNDICATION PROPOSAL IM=066P01.CPR DA= May 11, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/04/07/08 PA= PAGES: 7 SU= SUMMARY: The proposal for the syndication of the Bennett Williams Real Estate Project, that was developed and syndicated by Stan Caterbone. IM=066P02.CPR DI= PAGE 02 IM=066P03.CPR DI= PAGE 03 IM=066P04.CPR DI= PAGE 04 IM=066P05.CPR DI= PAGE 05 IM=066P06.CPR DI= PAGE 06 IM=066P07.CPR DI= PAGE 07 DI= ************************************************************ TI=\HIBBARD & BROWN SYNDICATION EFFORTS IM=067P01.CPR DA= May 11, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/04/07/08 PA= PAGES: 1 SU= SUMMARY: Letter from Ric Brown, principal of Hibbard Brown & Company, Inc., addressing the legal requirements for syndicating the Bennet Williams Deal.

Stan Caterbone had become dissatisfied at the response

of Hibbard & Brown regarding this matter, and both Pete Hibbard and Ric Brown had personally visited with Stan Caterbone at their offices when Stan Caterbone decided to perform his own due diligence on the pending deal. DI= ************************************************************TI=\HIBBARD & BROWN SYNDICATION EFFORTS II IM=068P01.CPR DA= May 11, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/04/07/08 PA= PAGES: 1 SU= SUMMARY: Letter from Ric Brown regarding Bennett Williams Syndication and Real Estate Project. DI= ************************************************************ TI=\SCOTT ROBERTSON LOAN FROM S. CATERBONE IM=069P01.CPR DA= May 11, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/04/07/08 PA= PAGES: 2 SU= SUMMARY: Copy of the cancelled check that was issued to Scott Robertson for the amount of $2,000.00 which was a loan from Stan Caterbone. Scott Robertson never paid the loan, and Stan Caterbone filed a civil suit in the court of Murray Horton, in January 8, 1988. Stan Caterbone had won judgement, but never collected monies. IM=069P02.CPR DI= PAGE 02 DI= ************************************************************ TI=\KAUFFMAN APOLOGY OF TERMINATION TO HIBBARD & BROWN IM=070P01.CPR DA= May 14, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/04/07/08 PA= PAGES: 1 SU= SUMMARY: Letter to Peter Hibbard from Robert Kauffman addressing the decision to terminate the previous agreed deal. Robert Kauffman stated that he nor Mike Hartlett agreed or wanted anything to do with the decision to look to another Broker Dealer for a deal. This is why they did what they did. DI= ***************************************************************** TI=\RESEARCH FOR THE SONY JOINT VENTURE PROPOSAL IM=071P01.CPR DA= May 18, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 4 SU= SUMMARY: A sample of the research materials used to develop the SONY deal for the "Digital" movie. IM=071P02.CPR DI= PAGE 02 IM=071P03.CPR

DI= PAGE 03 IM=071P04.CPR DI= PAGE 04 DI= ************************************************************

TI=\STAN CATERBONE AND RANDY GRESPIN VISIT PLANNERS SECURITIES GROUPIM=332.CPRDA= May 18, 1987AT= AUDIO TRACKS: /ALLPA= PAGES: 01

SU= SUMMARY: The Planner Schedule outlines the charter flight schedule of Stan Caterbone's plane, and his flight log to Atlanta, Georgia. After Stan Caterbone directed FMG, Ltd., to rescind the illegitimate and current merger with the Hibbard & Brown Company, Stan Caterbone decided to personally visit the Broker Dealer of William Koegler, of Atlanta, GA. Stan Caterbone was familiar with Bill Koegler's operation because of his work with the International Association of Financial Planners (IAFP). Many of the planners that served as National Chairmen of the IAFP were part of Bill Koeglers group. Bill Koegler also was a with John Keeble at FSC, in Atlanta. Stan Caterbone was well aware of the quality of products and services that they had to offer.

Stan Caterbone also invited attorney Randy Grespin to accompany him in an effort to work on the affiliation of The Underwriters Group of Harrisburg for possible insurance product. Stan Caterbone had been working with the president, Tony Pascotti, on a number of different projects.

Randy Grespin had agreed to pay Stan Caterbone for 1/2 of the charter costs for the use of Stan Caterbone's plane. Stan Caterbone would receive approximately $600.00 from The Underwriters Group for the charter service.

The meetings were very productive, and it is here that Stan Caterbone made a personal evaluation that the Planners Group would be the best firm to develop a merger/acquisition on the grounds of service, support, and reputation.

This meeting set the groundwork for the proceeding merger acquisition deal with Bill Koegler.

Immediately upon the return, Robert Kauffman made an announced visit to the residence of Stan Caterbone outraged and yelling "Who is running this company?" Stan Caterbone replied " I don't care who is running this company, as long as it is for the right reasons".

Bob Kauffman then asked Stan Caterbone to approve his new management contract, which included undeserving financial elements. Stan Caterbone quite emphatically opposed to having Robert Kauffman being compensated on business that was the direct and exclusive results of Stan Caterbone's efforts.

This set the stage for Robert Kauffman to find a way to get rid of Stan Caterbone, no matter what it would take.DI= ************************************************************

TI=\JOINT VENTURE PROPOSAL WITH SONY FOR DIGITAL MOVIE IM=072P01.CPR DA= May 25, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/04/05/06/07/08 PA= PAGES: 11 SU= SUMMARY: The original SONY deal that was developed by Stan Caterbone for the development of feature films, video, and theatrical productions utilizing the new DIGITAL Technology that was developed by Tony Bongiovi and Power Station Studios. Stan Caterbone created a business plan that would include the manufacturing of hardware systems for the professional recording studio, film theatres, and consumer electronics. Films have yet to deliver digital technologies. SONY JOINT VENTURE PROPOSAL FOR THE DIGITAL MOVIE I. INTRODUCTION II. SONY'S ROLE III. PRODUCT DEVELOPMENT IV. MARKETING AND DISTRIBUTION V. APPENDIX INTRODUCTION Tony Bongiovi and Power Station Studio are undertaking a project that has the potential of revolutionizing the entertainment industry. In the next few pages of this proposal, I will outline the elements involved and how Sony can participate in this landmark event. The technology of the recording industry has been advancing by leaps and bounds. We have seen the advances from monaural long playing record to stereo record to compact disc. Now we are seeing tape systems that use digital rather than analog signals appear, matching the quality of compact discs. What has happened to the theatre's? The audio portion of a film, is as responsible for the sensations one experiences at a motion picture as the visual, yet many theatre's are still equipped only for mono sound. Why is this? We feel there are two basic reasons. 1> The relative high cost of upgrading a theatre to be able to incorporate the advanced technologies of the audio industry. 2> The lack of proper equipment for the film industry to produce high quality digital audio tracks. These two problems should not be addressed separately. There is little motivation for upgrading until the product is available and even less motivation to produce a product that can not be heard. Tony Bongiovi and Ed Evans at Power Station in New York, have now made it possible to address these problems simultaneously. Their creation of the new "Power Station Digital

Movie Sound" (PSDMS), will not only enable the film industry to produce the highest quality audio tracks for film, but will also allow theatre's to upgrade their existing sound system at a minimal cost. To introduce this revolutionary new sound, Bongiovi is in the process of producing a film entitled "Mutant Mania", which is a science fiction action horror film, shot in a small ocean resort town in New Jersey. This film has many elements that make it perfect for the introduction of PSDMS. The most prevalent of these being the heavy music score by Bongiovi's latest band "French Lick". Producing bands is definitely one of Bongiovi's fortes. Bongiovi was instrumental in creating "Bon Jovi" who is probably the strongest force in the rock and roll circuit today. "Bon Jovi's" third album "Slippery When Wet", has sold more copies in a short period of time than any other band in history. Another is the fact that this is a horror film. The use of audio in horror films is important to create tension, fear, excitement etc.. Using a horror film also lessens the influence the critics have on the audience. By the large this film will stand on it's own merits. Now add PSDMS, and you have a potential block buster event. How does Sony fit into all of this? SONY'S ROLE What We are seeking to do, is establish a distribution route in which the message of Sony's new technology and its benefits can be more easily and directly passed on to the consumer. SONY/PSDMS Picture a one or two minute commentary at the beginning of the movie and home video, demonstrating the difference between the quality of theatrical sound now and the new SONY/PSDMS sound. This does two things. First, by demonstrating the difference in quality of the new sound, you reinforce in the audiences mind that it is much better, which as you will hear, there is little doubt. Secondly it reinforces in the audience that Sony truly is a pioneer of advanced innovative technologies. In addition to the commentary, Sony will receive credits on the film, ie. SONY/PSDMS. We will include in the copyright agreement that Sony Equipment must be used to be SONY/PSDMS. Sony's name will also be strategically placed throughout the film. This may be done in the form of billboards, advertisements, or Sony equipment being utilized. A commercial may be developed for TV promoting both the film and Sony's contributions to advanced audio techniques in the film industry. This could be done as a joint venture between Sony and the distribution company for the theatrical and video

exhibition. Inside every video tape that is sold, a coupon may be placed to promote Sony products. A full line of quality equipment may be SONY/POWER STATION labeled for consumer use to enhance marketability of Sony entertainment products. Sony Video Software Corporation will receive right of first refusal on all contracts for video and theatrical distribution. We will allow Sony a preferred 5% margin under any other distributor for a competitive edge. TIMING Timing is crucial in a project that touch so many different areas. MARKETING AND DISTRIBUTION Most of the industry by their own admission is at least two years away from an effort to upgrade the sound in movie theatres. With the SONY/PSDMS system, other companies may adapt easily and economically to produce products with digital movie sound. With companies adapting to this process, the future should see the prominence of the SONY/PSDMS insignia much the same as you see the Dolby insignia today. This will act as a constant reminder to the public that Sony truly is a pioneer of advanced audio visual technologies. Sony will receive exposure in the professional market place by having the SONY/POWER STATION equipment used in theatres and studios to produce the SONY/PSDMS sound. The video industry is a 56 billion dollar industry that is in need of product. When you look at the potential for a product that will be one of the first feature films to compliment the fast paced VCR/Stereo Entertainment components, with a musical score that may have enough merits of its own, you have an amazing potential for distribution. The Digital and Disc Industry has proven to be the future standard for recording and playing. Because of the relative newness of the digital format, there are more people who have yet to experience the digital sound. With the high exposure that will come from this project, this could be the first time ever people hear digital. How many people? 1 - 10 - 50 - 100 million? What will be their first reaction? I need to buy a Disc Player! Who's name will they think of first? SONY/PSDMS! PRODUCT DEVELOPMENT Bongiovi and Evans at Power Station have developed a revolutionary hybrid mixing console to penetrate the video post

production market. This console was developed to enable engineers to produce high quality audio tracks for the film industry as well as the recording industry. This new console utilizes an automation system that can be used by both industries. This new console is especially attractive to the film industry, as it will greatly reduce production costs since mixing costs in a recording studio are much less. At present the console that is being used is a bastardized system that utilizes components from many different pieces of equipment, from a number of different companies, of which Sony is one. Because we already have a working model of this console, it would take very little time for a finished product to be manufactured that could carry the SONY name. The other piece of equipment that is essential to the PSDMS process, is the box that enables the laser disc to automatically read the synchronization track encoded on the film. This piece of equipment can be produced at an extremely low cost. It is this low cost and the fact that the theatres will not have to replace their present projectors that make digital movie sound a reality in 1988. We feel that with consumers demanding the same quality audio at theatres, as they have become accustomed to with their home entertainment systems, theatre owners will have little problem investing the nominal amount of dollars involved, to upgrade their theatres for digital audio. This investment could be as low as $1000. With the cost being so low, the distribution company may want to consider bearing the burden of this cost, if the theatre owners agree to show Bongiovi's next three films. FINANCIAL STRUCTURE SONY will commit four million dollars for the production of Bongiovi's film to be released in 1988. We would like SONY to commit fifteen million for three to four future products that will follow the same format as the first, so that Bongiovi and SONY will position themselves as the pioneer and leaders in the industry. This will not allow competition to gain access to the marketplace until we are all firmly situated and profitable. Sony will only pay for expenses to produce 60 second spots. Tony and Power Station will utilize any and all services to help produce the spot and will allow reimbursement for only true costs with no mark up including all of Tony's time which will be free. Power Station and Power Productions I will receive a negotiated percentage from all revenues generated from the merchandizing campaign of the SONY/POWER STATION products and the sale that may result to other film studios utilizing Sony/POWER STATION equipment in the PSDMS System.

We will receive four deluxe entertainment systems - Television, VCR, Stereo, Etc. that is top of the line to help during the production of the film. The purpose of the above and all aspects of this Proposal is to let the separate entities involved maximize their profits for their respective talents; Bongiovi in film and music production and Sony in manufacturing and distribution of equipment and merchandise and later video and film distribution. END IM=072P02.CPR DI= PAGE 02 IM=072P03.CPR DI= PAGE 03 IM=072P04.CPR DI= PAGE 04 IM=072P05.CPR DI= PAGE 05 IM=072P06.CPR DI= PAGE 06 IM=072P07.CPR DI= PAGE 07 IM=072P08.CPR DI= PAGE 08 IM=072P09.CPR DI= PAGE 09 IM=072P10.CPR DI= PAGE 10 IM=072P11.CPR DI= PAGE 11 DI= ************************************************************

TI=\"BEYOND THE BIJOU" - Sophisticated Film Technologies For SoundIM=332A.CPRDA= May 18, 1987AT= AUDIO TRACKS: 04/05/07/08PA= PAGES: 7

SU= SUMMARY: In May of 1987, Stan Caterbone attended a conference sponsored by Philadelphia Life, in Palm Springs, California. The trip was awarded because of the high amount of business Stan Caterbone did with the Philadelphia Life Company. Most of this business was the result of the Estate Planning performed for Dr. William Umiker.

Upon returning, Stan Caterbone found this article in "SKY" MAGAZINE, supplied by the airlines. The article in the Technology section explicitly discusses the poor quality of sound that is delivered in conventional full length major film productions. It also discusses the future need for a "digital" technology to improve the overall effect of motion pictures. The author also applauds the work of George Lucas, of Lucasfilm, for the "Star Wars" production, of which Tony Bongiovi was an integral part of.

Ironically, this was another one of those extraordinary "coincidences" ? Especially considering that Stan Caterbone had just returned from Hollywood where he disclosed his SONY proposal to Flatbush Films. And conveniently, he finds a newly published article supporting his findings of the same topic.

Stan Caterbone left the conference early in order to meet with Marcia Silen, one of the producers for Flatbush Films. Stan Caterbone had disclosed the original draft for the SONY joint venture proposal. Stan Caterbone and Marcia Silen collaborated on the proposal and Marcia Silen said "Stan, you are a genius".

Stan Caterbone also visited with Becky Austin, Marcia Silen's sister, and discussed the mortgage banking business. Becky Austin was a paralegal for one of the more active law firms specializing in Real Estate in Beverly Hills. Becky and Stan discussed a strategic alliance that would result in the development of an office in Beverly Hills for the loan portfolio of Institutional Investors. Al Dannatt was consulted, and a future meeting between Stan Caterbone, Becky Austin, and Al Dannatt was agreed upon either in Houston, Texas, or Beverly Hills, CA. Becky Austin was very experienced in the Beverly Hills real estate business, and had a great of connections that would have been required to pursue such a business.

Marcia Silen had tried to schedule a meeting between Ted Gamillion of Gamillion Studios, and Stan Caterbone, however schedules were not permitting. The meeting would later take place on July 21, 1987.

IM=332B.CPRDI= PAGE 2IM=332C.CPRDI= PAGE 3IM=332D.CPRDI= PAGE 4IM=332E.CPRDI= PAGE 5IM=332F.CPRDI= PAGE 6IM=332G.CPRDI= PAGE 7DI= ************************************************************

TI=\DIGITAL MOVIE LETTER OF INTENT IM=073P01.CPR DA= May 19, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 3 SU= SUMMARY: Letter of Intent for Joint Venture Participation and contribution for the "Digital" movie. Norris Boyd of Boyd Wilson, shareholder and client of FMG, and owner of Olde Hickory Properties, to which Stan Caterbone had produced a $5,000,000 loan, of which Noris Boyd had specifically noted that the terms were better than those of Commonwealth National Bank, which was holding the existing paper, which totaled more than 12,000,000, of whom repossess Stan Caterbone's plane, 15 days before any monies due, had agreed to invest in the movie. IM=073P02.CPR DI= PAGE 02 IM=073P03.CPR DI= PAGE 03 DI= ************************************************************

TI=\POWER PRODUCTION I -- LEGAL FORMATION IM=074P01.CPR DA= May 20, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: Invoice from Richard C. Fox, Attorneys at Law in Harrisburg, PA to Stan Caterbone for the professional services rendered including the drafting of a Letter of Intent for the "digital" movie "Mutant Mania", and the structuring of Power Productions I, the General Partner for the movie project with Tony Bongiovi and Power Stations Studios, of New York NY. DI= ************************************************************ TI=\FLATBUSH FILM LETTER RE: INSURANCE BONDING IM=075P01.CPR DA= May 21, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: Letter from Arlene Davidson, Associate Producer, of Flatbush Films, Sherman Oaks CA outlining specific bonding requirements, budget requirements, and actual production requirments for the "digital" movie project. DI= ************************************************************ TI=\FLATBUSH FILM LETTER CONFIRMING SCHEDULE OF MEETINGS IM=076P01.CPR DA= May 23, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: Letter to Ellen Libman, Power Station Studios, copied to Stan Caterbone outlining the schedule of meetings with Marcia Silen, Barbara Peters, and Arlene Davidson, all of Flatbush Films, the Producers for the "digital" movie. All parties were to meet in Wildwood, NJ, the location for the filming of the movie. DI= ************************************************************

TI=\FINANCIAL MANAGEMENT GROUP, Ltd., CORPORATE & FINANCIAL STATUS TO DATEIM=313.CPRDA= May 23, 1987AT= AUDIO TRACKS: ALLPA= PAGES: 1

SU= SUMMARY: Stan Caterbone had prepared a financial and corporate status report for Financial Management Group, Ltd.,. This report was prepared from information that Stan Caterbone had formulated along with certain financial estimates obtained from Robert Kauffman. This report illustrates the extraordinary comparisons of original growth rates for a 3 year period that was originally projected in the original business plan of July, 1986. By May of 1987, the report suggests that FMG, Ltd., was almost 2 YEARS ahead of the original forecasts for:

capital raised; total commissions; total revenues; sales force; and most importantly corporate equity or stock value.

Under the above assumptions, utilizing the traditional method of valuing a financial services distribution company, the value per share was estimated at $17.00 per share.

This method of valuation would have valued the stock of Stan Caterbone to be worth $686,800.00.DI= ************************************************************ TI=\DIGITAL MOVIE MARKETING MATERIALS IM=077P01.CPR DA= May 25, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 15 SU= SUMMARY: A copy of the marketing materials used in talking to potential investors for the movie "MUTANT MANIA". IM=077P02.CPR DI= PAGE 02 IM=077P03.CPR DI= PAGE 03 IM=077P04.CPR DI= PAGE 04 IM=077P05.CPR DI= PAGE 05 IM=077P06.CPR DI= PAGE 06 IM=077P07.CPR DI= PAGE 07 IM=077P08.CPR DI= PAGE 08 IM=077P09.CPR DI= PAGE 09 IM=077P10.CPR DI= PAGE 10 IM=077P11.CPR DI= PAGE 11 IM=077P12.CPR DI= PAGE 12 IM=077P13.CPR DI= PAGE 13 IM=077P14.CPR DI= PAGE 14 IM=077P15.CPR DI= PAGE 15 DI= ************************************************************ TI=\FMG, Ltd., NEWSLETTER OF 5/26/87 IM=078P01.CPR DA= May 26, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 2 SU= SUMMARY: Michael Hartlett welcomes the association of Craig Russel and the law firm of Russel, Kraft, Gruber, and Huber to

FMG, Ltd,. Michael Hartlett had proceeded with structuring a deal with the Craig Russell, without any considerations by Stan Caterbone, principal, or the Board of Directors. IM=078P02.CPR DI= PAGE 02 DI= ************************************************************ TI=\W. UMIKER ESTATE PLANNING IM=079P01.CPR DA= May 28, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: Letter to Dore Valvanes regarding the Power of Attorney of Dr. William Umiker. DI= ************************************************************ TI=\FLATBUSH FILM DRAFT SCREENPLAY OF DIGITAL MOVIE IM=323.CPR DA= May 29, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: Letter and first draft of screenplay of the"digital" movie in preparation for meetings in Wildwood NJ. Letter is from Arlene Davidson of Flatbush Films to Stan Caterbone. DI= ************************************************************ TI=\FLATBUSH FILM MEETING SCHEDULE IM=081P01.CPR DA= May 29, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: Revised schedule of the meeting in Wildwood NJ, with Flatbush Films, Power Station Studios, and Stan Caterbone DI= ************************************************************ TI=\JUNE PLANNER SCHEDULE OF S. CATERBONE IM=082P01.CPR DA= June 1, 1987 IM=322.CPRAT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/07/08 PA= PAGES: 1 SU= SUMMARY: Flight log of Stan Caterbone outlining the flight to William Koegler, Broker Dealer, on the 18th of June with Randy Grespen, of the Underwriters Group, (TUG). TUG had agreed to pay for 1/2 of the flight hours at the rate of $250.00 per hour, approximately 7. Also outlines the schedule of Jim Bly, of Source Capital to rent the airplane at the rate of $250 per hour, which would have been approximately 6 hours of flight time. The plane was repossessed and Jim Bly was unable to fly. DI= ************************************************************

TI=\BUSINESS WEEK "SONY'S CHALLENGE"IM=331.CPRDA= June 1, 1987AT= AUDIO TRACKS: 04/05/08/09PA= PAGES: 7

SU= SUMMARY: The June 1, 1987 issue of "Business Week", features SONY chairman Ako Morito on the Cover. The article is another example of the incredible foresight with which the SONY joint venture proposal was developed. The strategies and the business elements that the SONY joint venture proposal contains, are clearly substantiated in this feature article.

The SONY joint venture proposal for the "Digital" movie was produced some 40 days prior to the release of this article.IM=331B.CPRDI= PAGE 2IM=331C.CPRDI= PAGE 3IM=331D.CPRDI= PAGE 4IM=331E.CPRDI= PAGE 5IM=331F.CPRDI= PAGE 6IM=331G.CPRDI= PAGE 7DI= ************************************************************

TI=\TRUMP STOCK CERTIFICATES IM=083P01.CPR DA= June 3, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/04/07/08 PA= PAGES: 1 SU= SUMMARY: Letter from Rick Trump, a satellite office of FMG, Ltd., located in Skippack, PA, to Stan Caterbone regarding previous stock transactions and instructions for Stan Caterbone regarding the titles of the stock certificates. DI= ************************************************************ TI=\LAST FMG, Ltd., STOCK CERTIFICATE ISSUED BY S. CATERBONE IM=084P01.CPR DA= June 9, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/04/07/08 PA= PAGES: 1 SU= SUMMARY: Last legal Financial Management Group, Lt,, signed by Stan Caterbone, Secretary, Executive Vice President. DI= ************************************************************ TI=\LANCASTER AVIATION COMPLAINT LETTER IM=319.CPR DA= June 11, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08

PA= PAGES: 2 SU= SUMMARY: Letter to Charles Smith, President of Lancaster Aviation from Stan Caterbone, regarding dissatisfaction of the conduct of Lancaster Aviation, Pete Wolfson, and the persuasion by Lancaster Aviation not to purchase the no cash deal of Gannett Flemming, of Harrisburg, for the purchase of the Cessna 402 B-1973 aircraft, in which Gannett Flemming would have provided 100% financing at approximately 1/2 the cost of the Lancaster Aviation aircraft. IM=319B.CPR DI= PAGE 02 DI= ************************************************************ TI=\FLATBUSH FILMS PRODUCTION SCHEDULE FOR DIGITAL MOVIE IM=086P01.CPR DA= June 12, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 7 SU= SUMMARY: Letter to Stan Caterbone from Arlene Davidson of Flatbush Films outlining the production schedule of the "Digital" movie. Schedules begin June 28, 1987 and are completed in Post Production in January of 1988. Davidson also expresses concern to move everything up 15 film is to be produced this season. IM=086P02.CPR DI= PAGE 02 IM=086P03.CPR DI= PAGE 03 IM=086P04.CPR DI= PAGE 04 IM=086P05.CPR DI= PAGE 05 IM=086P06.CPR DI= PAGE 06 IM=086P07.CPR DI= PAGE 07 DI= ***********************************************************

TI=\AIRCRAFT PURCHASE AGREEMENTIM=314.CPRDA= June 12, 1987AT= AUDIO TRACKS: /ALLPA= PAGES 2

SU= SUMMARY: Following are the authentic "PURCHASE AGREEMENT" for the 1978 PA-31-325 PIPER aircraft and the "REGISTRATION" filed with the U.S. Department of Transportation. This agreement was authorized by Pete Wolfson, Director of Sales with Lancaster Aviation.IM=315.CPRDI= PAGE 02DI= ************************************************************ TI=\FARMERS FIRST BANK LINE OF CREDIT APPLICATION

IM=087P01.CPR DA= June 13, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 2 SU= SUMMARY: Documents are in part of application for a line of credit to Farmers First Bank, by Stan Caterbone. Pete Richter of Farmers First was handling the loan application. Stan Caterbone had applied for a line of credit, pledging his stock in Financial Management Group, Ltd. for collateral. However Michael Hartlett refused to provide any financial information of Financial Management Group, Ltd., to either Farmers First, or to Stan Caterbone, which according to the bylaws and the articles of incorporation is in violation of shareholder rights to inspect the books! IM=087P02.CPR DI= PAGE 02 DI= ************************************************************ TI=\WEINSTEIN DEVELOPMENT REQUEST FOR FINANCING IM=088P01.CPR DA= June 15, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/04/07/08 PA= PAGES: 1 SU= SUMMARY: Letter from Susan Weinstien, of Tenefly NJ requesting financing of both debt and equity for real estate project in the rapidly growing Hunterdon County, New Jersey, which is in the I-78 Corridor outside New York City. Susan was referred by Tony Bongiovi and Bob Walters. DI= ************************************************************

TI=\PLANNERS SECURITIES -- FMG, Ltd., ACQUISITION IM=089P01.CPR DA= June 18, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: Planner Schedule outlining trip to Atlanta in Stan Caterbone's plane with Randy Grespin of (TUG) The Underwriters Group to propose deal with the Broker Dealer of William Koegler, The Planners Security Group. TUG was paying $250 per hour for 1/2 of trip. Stan Caterbone recommended that FMG, Ltd., to a deal with the Planners Group, instead of Hibbard Brown. When Stan Caterbone arrived back in Lancaster, Robert Kauffman demanded an explanation as to "Who is running this show?" Stan said "I don't care who, as long as its done right!" DI= ************************************************************ TI=\FMG, Ltd., PATENT RESEARCH IM=090P01.CPR DA= June 22, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 2 SU= SUMMARY: Letter from Joel Goldhammer of Seidel, Gonda, Goldhammer, & Abbott, P.C., of Philadelphia to Stan Caterbone

regarding the "Service Mark Search for "Financial Management Group" for patent and or trademark analysis for services of legal, accounting, real estate, insurance stock brokerage, portfolio management, market timing, financial planning, mortgage banking, and investment banking. Also enclosed was the actual results of the search done on a national basis. IM=090P02.CPR DI= PAGE 02 DI= ************************************************************ TI=\UMIKER MEMO IM=091P01.CPR DA= June 22, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: Memo to Dr. William Umiker from Stan Caterbone discussing the retainment of Todd Dellinger, of FMG, Ltd., as Director of Client Affairs, for the clients of Stan Caterbone, exclusively, due to the rapid growth of FMG, Ltd., and the additional responsibilities of Stan Caterbone with regards to Mortgage Banking and the "Digital" movie. DI= ************************************************************ TI=\LARRY RESCH (ISC) MEETING WITH STAN CATERBONE IM=092P01.CPR DA= June 23, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/04/07/08 PA= PAGES: 1 SU= SUMMARY: Planner schedule of June 23, 1987 of Stan Caterbone, outlining the meeting initiated by Larry Resch, partner with Jere Sullivan (personal friend of Stan Caterbone) and Carl Jacobson, brother-in-law of James Guerin, with Stan Caterbone at his office at FMG, Ltd.,. Upon arrival Larry Resch said that "Carl Jacobson could not make it, we had to fly him out of the country early this morning". In February of 1991, Stan Caterbone learned from inside sources, that Carl Jacobson was transported to Chile, the home of Carlos Cardoen, arms dealer. Apparently James Guerin had used one of his jets in his corporate fleet to avoid the international border requirements. It was also rumored that the reason that Commonwealth Bank repossessed his aircraft was that it was afraid that Stan Caterbone was going to provide transportation to fly James Christian out of the country. This rumor was witnessed by Karen Hickman at Trio's Restaurant. She overheard a conversation between Pete Slaugh, an FMG, Ltd., joint venture partner, and another businessman in September of 1988. It was also widely known that Jim Guerin had a great deal of interest and influence in Commonwealth Bank.

Stan Caterbone proceeded to his office and began the meeting. He went on to describe the alleged illegal and improper business activities of James Guerin, ISC, and their role in the United Chem Con case. Larry requested Stan Caterbone to find a new facility for Chem Con, and help rescue the company .

Jere Sullivan had called Tom Caterbone, brother of Stan Caterbone, on or about December 16, 1990, to question whether Stan Caterbone was taking medicine, and again to allege a relapse of "insanity", as he did back in 1987. During the month of December, of 1990, Stan Caterbone made it known that it was time to resolve any and all issues relating to the "Blackmail" of 1987. Stan Caterbone also specifically told Jere Sullivan that he had talked to James Christian from Loretto State Prison December 7th, 1990. Jere Sullivan tried to convince Stan Caterbone that Larry Resch was a friend and "Larry would not do anything to hurt you". Jere Sullivan also indicated that Jim Christian had told his mother that he was responsible for calling the FBI to report criminal allegations of James Christian, back in the summer of 1987.DI= ************************************************************ TI=\FMG ADVISORY RIA APPLICATION IM=093P01.CPR DA= June 23, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/04/07/08 PA= PAGES: 2 SU= SUMMARY: Letter to Stan Caterbone, from Jeff Jamouneau, of McNeese Wallace, and Nurick enclosing a form letter to Paul D. Schwartz of the Pennsylvania Securities and Exchange Commission with regards to the Registered Investment Advisor application of FMG Advisory, of which Stan Caterbone was President, and Secretary. IM=093P02.CPR DI= PAGE 02 DI= ************************************************************ TI=\INVOICE FOR LOCKS CHANGED BY RUSSEL LOCKS IM=094P01.CPR DA= June 23, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: Invoice from Russell Locksmith to Stan Caterbone and FMG Advisory for changing the lock to the office of Stan Caterbone, which was performed on June 23, 1987. Stan Caterbone became suspicious of Robert Kauffman and Michael Hartlett, and because of his fiduciary responsibility as an officer, to the shareholders, and in preservation of his own investments and business dealings, wanted additional security while he investigated questionable activities of Hartlett and Kauffman. All FMG transfer records were contained herein. DI= ************************************************************ TI=\FORGED STOCK AND BURGLARY OF S. CATERBONE'S OFFICE IM=096P01.CPR DA= June 25, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 2 SU= SUMMARY: A copy of a Stock Certificate for FMG, Ltd., for 8,000 shares made out to Peter Peneros and Scott Robertson, with the forged signature of Robert R. Long signing as Secretary of

FMG, Ltd., when in fact Stan Caterbone was the legal secretary of Financial Management Group, Ltd., Robert Kauffman also signed as President, signifying his involvement of violations of the Articles of Incorporation, Corporate Bylaws, Offering Memorandum, etc Even more importantly, Stan Caterbone had all of the records and transfer books in his locked office (6/23). Stan Caterbone discovered that most of his business files concerning his mortgage banking activities as well as other confidential business deals and his corporate files that were administered under his fiduciary responsibility as Secretary of Financial Management Group, Ltd., and President of FMG Advisory, were removed without his knowledge or consent.

IM=SCOTT.CPRDI= PAGE 2DI= ************************************************************

TI=\POWER STATION PATENT RESEARCHIM=PP1.CPRDA= June 25, 1987AT= AUDIO TRACKS: 04/05/08/09PA= PAGES: 03

SU= SUMMARY: Stan Caterbone had directed patent attorney Jeff Goldhammer to research information regarding the "Power Station" trademark for the purpose of merchandizing various electronic equipment in both the retail and professional video and recording markets. This was especially important for the "Power Station Digital Music Sound" (PSDMS) that would be an integral part for the movie.IM=PP2.CPRDI= PAGE 2IM=PP3.CPRDI= PAGE 3DI= ************************************************************

TI=\LANCASTER AVIATION INVOICE FOR UNAUTHORIZED REPAIRS IM=097P01.CPR DA= June 26, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 2 SU= SUMMARY: An invoice from Lancaster Aviation and Chuck Smith to FMG, Ltd., for unauthorized repairs made to the aircraft of Stan Caterbone. Stan Caterbone purchased the aircraft with the requirments of a pre inspection, of which no mention of any required or deficient mechanical problems made during the settlement of the purchase of the aircraft. Stan Caterbone had no knowledge of any work performed on the aircraft until receipt of this invoice. Another attempt to embezzle funds from Stan Caterbone. IM=090P02.CPR DI= PAGE 02 DI= ************************************************************ TI=\LANCASTER AVIATION INVOICE

IM=098P01.CPR DA= June 29, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: A letter from Chuck Smith of Lancaster Aviation to Stan Caterbone, demanding payment for the repairs of the previous invoice, fuel, and pilot services. More importantly, Chuck Smith acknowledges that he as taken the liberty of repossessing the aircraft, which was why Jim Bly of Source Capital was unable lease the plane from Stan Caterbone. However Stan Caterbone had an unsecured line of credit with Lancaster Aviation, and had no financial interest in the aircraft at the time of repossession. He also verifies that the plane is insured. DI= ************************************************************ TI=\JUNE PLANNER SCHEDULE OF S. CATERBONE IM=099P01.CPR DA= June 29, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: Stan Caterbone has a meeting at the headquarters of Bennett Williams, of York PA, with Dave Schadd and Bob Buehler. Stan Caterbone was about an hour late for the meeting, and arrived at about 12:00pm. Stan Caterbone had discussed the pending real estate deal and specifically the interest of Dave Cook. Stan Caterbone also discussed the seriousness of his partners recent actions, specifically the break-in of his office. Bob Kuaffman had made previous arrangements to sit in on meeting, uninvited, and without Stan Caterbone's invite! DI= ************************************************************ TI=\W. UMIKER CHECK TO LANCASTER AVIATION IM=100P01.CPR DA= June 29, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: A copy of the check from Dr. William Umiker made payable to Lancaster Aviation in the amount of $25,000. After Chuck Smith had knowingly deposited a post dated check from Stan Caterbone that did not have sufficient funds, Stan Caterbone had called Dr. William Umiker to loan the funds until the monies were received from Keystone Mutual Funds, in the account of Millard Johnson. Dr. Umiker was repaid the following day, when the funds were received from Keystone, as expected. This was another attempt by Chuck Smith to discredit Stan Caterbone. DI= ************************************************************ TI=\SUBPOENA FOR S. CATERBONE IN CASE VS. H. FISCHER IM=101P01.CPR DA= June 30, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/04/07/08

PA= PAGES: 1 SU= SUMMARY: A Subpoena to Stan Caterbone from the law offices of Rank & Rank for the Court of Common Pleas. Katherine H. Evers, plaintiff, had subpoenaed Stan Caterbone in the case against Herbert Fischer, Martin Sponaugle, and the company of Fischer-Sponaugle real estate company, the owner of the FMG, Ltd., headquarters, and general partner for Eden Associates II. Stan Caterbone never new anything about this case, and still has no knowledge why he was subpoenaed. DI= ************************************************************

TI=\FMG, Ltd., SHAREHOLDERS OF RECORD (JUNE 23, 1987)IM=312.CPRDA= June 23, 1987AT= AUDIO TRACKS: ALLPA= PAGES; 1

SU= SUMMARY: The last documented Shareholders of Record that Stan Caterbone had prepared before FMG, Ltd., officers had illegally obtained access to such records.DI= ************************************************************ TI=\FMG, Ltd., MESSAGES FOR S. CATERBONE IM=102P01.CPR DA= July 1, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 9 SU= SUMMARY: Phone Messages taken by Lynn Kreider, of FMG, Ltd., and Administrative assistant for FMG Advisory and FMG Accounting. The phone messages were taken for Stan Caterbone, and reflect business as usual. IM=102P02.CPR DI= PAGE 02 IM=102P03.CPR DI= PAGE 03 IM=102P04.CPR DI= PAGE 04 IM=102P05.CPR DI= PAGE 05 IM=102P06.CPR DI= PAGE 06 IM=102P07.CPR DI= PAGE 07 IM=102P08.CPR DI= PAGE 08 IM=102P09.CPR DI= PAGE 09 DI= ************************************************************ TI=\LIQUID ASSETS CASH BALANCE AS OF JULY 3, 1987 IM=103P01.CPR DA= July 1, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 8

SU= SUMMARY: Copies of all cash accounts for Stan Caterbone, that indicate that on July 1, 1987, Stan Caterbone had cash balances of $15,134.10. This is quite contrary to what the banks were indicating by their malicious actions toward both a borrower and competitor. IM=103P02.CPR DI= PAGE 02 IM=103P03.CPR DI= PAGE 03 IM=103P04.CPR DI= PAGE 04 IM=103P05.CPR DI= PAGE 05 IM=103P06.CPR DI= PAGE 06 IM=103P07.CPR DI= PAGE 07 IM=103P08.CPR DI= PAGE 08 DI= ************************************************************ TI=\PLANNER SCHEDULE OF S. CATERBONE RE: J. RODA IM=104P01.CPR DA= July 2, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: After learning the actions of several FMG, Ltd., persons in burglarizing the office of Stanley J. Caterbone, Executive Vice President, Secretary, Incorporator, and Tenant, of Financial Management Group, Ltd,. and President, Incorporator, and Secretary of FMG Advisory, and President, Incorporator, and Owner of Pro Financial Group, Ltd., and Proprietor of Creative Finance, and General Partner of Power Productions I, Stan Caterbone had the fiduciary obligation and responsibility to preserve and protect the interests of the above entities. DI= ************************************************************ TI=\ROMAR AVIATION IM=105P01.CPR DA= July 2, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 3 SU= SUMMARY: Receipt and cancelled check drawn on Fulton Bank, from Romar Aviation, confirming payment for pilot, gas, and insurance. Stan Caterbone had decided that it would be in the best interest of all concerned to move his files to Stone Harbor NJ, where he could begin to inspect the records of all of the companies that were headquarter at the 1755 Oregon Pike, Lancaster PA. However, the airplane was conveniently repossessed with all documents held as hostage. Stan Caterbone had instructed Romar Aviation to store the aircraft on their premisses, because of all the games that Lancaster Aviation, of which Stan Caterbone

suspected foul play on many previous occasions.

In February of 1991, Stan Caterbone had learned from inside sources that the owner of Romar Aviation was personal friends of Jim Guerin, and was also a business associate of the same. This would conveniently give Jim Guerin influence to all three companies that were involved in the illegal repossession: Lancaster Aviation, Romar Aviation, and most importantly Commonwealth National Bank.IM=RO1.CPRDI= PAGE 2IM=RO2.CPRDI= PAGE 3DI= ************************************************************ TI=\PLANNER SCHEDULE OF S. CATERBONE RE: J. RODA IM=106P01.CPR DA= July 3, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: Planner of Stan Caterbone referring to the second day of meetings and conferences with Joe Roda. On July 3rd at approximately 2:00pm Stan Caterbone had loaded all relevant files and copies in his aircraft, in preparation for the flight to Cape May County Airport NJ. Stan Caterbone had rented a home in Stone Harbor, with specific intent during the production of "Mutant Mania". At approximately 9:00pm, Stan Caterbone was in Stone Harbor when Victor, the pilot from Romar Aviation, called to inform that the aircraft had been reposed with the fe DI= ************************************************************ TI=\PLANNER SCHEDULE OF S. CATERBONE RE:PLANE REPOSSESSIONIM=107P01.CPR DA= July 4, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: At approximately 9:30am, Stan Caterbone had called Joe Roda from Stone Harbor, quite upset and historical about the plane that was illegally reposed with all of his files conveniently held hostage. Joe Roda had replied "Stan you have to quit making up these allegations"!!!!!

Stan Caterbone proceeded to the Cape May County Airport to hire a pilot to fly to Lancaster to retrieve the files DI= ************************************************************ TI=\RECEIPT FROM PILOT BRAD DONAHUE FOR RESCUE OF FILES IM=108P01.CPR DA= July 4, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: In efforts to thwart a cover up, Stan Caterbone retained the services of pilot Brad Donahue, of Cape May County

Airport to fly to Lancaster Aviation, in the Lancaster Airport, to retrieve the files that were merely stolen and held hostage in Stan Caterbone's airplane. The receipt, signed by Brad Donahue, is for $400.00. Stan Caterbone had offered Brad Donahue $200.00 if he did not have any confrontations, and $400.00 if there were any confrontations with Lancaster Aviation or authorities. Brad Donahue died a few weeks later due to a suspect plane accident. DI= ************************************************************ TI=\PLANNER SCHEDULE OF S. CATERBONE RE: ATTY. RIC FOX IM=109P01.CPR DA= July 5, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: Stan Caterbone had called Ric Fox in efforts to take legal actions against all alleged defendants. Ric Fox had brought an attorney friend and flew into Cape May County Airport, where they were picked up by David Porter and driven to the residence of Stan Caterbone, 554 Berkley Rd Stone Harbor, NJ. After Stan Caterbone discussed and described the circumstances surrounding the last 7 days, Ric Fox asked "What did they do wrong?". Upon leaving he requested a retainer of $5,000 to look further into matters. DI= ************************************************************ TI=\COMMONWEALTH BANK NOTICE OF PLANE REPOSSESSION IM=110P01.CPR DA= July 6, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 3 SU= SUMMARY: The letter from Larry W. Snyder, Manager of Consumer Loan Collections, of Commonwealth National Bank, to Stan Caterbone, informing him of the repossession of his airplane, that took place on July 2, 1987, as they confirm. There were no reasons for the repossession that were the least bit true, and even furthermore, was the fact that it was 23 days prior to the first scheduled payment of the loan agreement signed on June 12, 1987 that included $27,000 in cash paid to Lancaster Aviation. IM=110P02.CPR DI= PAGE 02 IM=110P03.CPR DI= PAGE 03 DI= ************************************************************ TI=\PLANNERS SECURITIES TERMINATION LETTER IM=111P01.CPR DA= July 8, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: Letter from Kathy A. Diehl, Registration Administrator

of the Planner's Securities Group, Inc., of Atlanta GA, advising Stan Caterbone that his license with PSG, INC., has been terminated, and may no longer sell securities with the Broker Dealer that Stan Caterbone selected to merge with FMG, Ltd.,. The letter was copied to Robert Kauffman. Stan Caterbone never received any explanations as to the reasons for terminating his securities license, which was as clean as his credit report, which was as good as you can have. DI= ************************************************************ TI=\PLANNER LOG RE: GAMILLION STUDIOS, CAPELLO & FOLEY IM=112P01.CPR DA= July 8, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: The planner schedule for July 8, 1987, which displays the phone log of Stan Caterbone. Stan Caterbone had called Bill Koegler of the Planners Securities Group, Inc., to inform him of the Lock-Out by Robert Kauffman and Mike Hartlett, of FMG, Ltd.,. Stan Caterbone was not very understanding, and had questioned Bill Koegler if he was helping Robert Kauffman steal his company. Bill Koegler responded with the terminating Stan Caterbone's securities license with the Planners Securities Group. DI= ************************************************************ TI=\PLANNER SCHEDULE RE: JOHN RODA IM=113P01.CPR DA= July 9, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: Phone log of July 9, 1987, of Stan Caterbone. Stan Caterbone was referred to another attorney, Lew Schweller, of the law firm of Valore, McAllister, Westmoreland, Gould, Vesper & Schwartz. Stan Caterbone had called to set up a meeting, since all previous efforts to pursue legal action had done nothing but cost money and aggravation. John Roda, brother of attorney Joe Roda, had called Stan to advise him to take it easy and to seek medical help, most likely at the request of Joseph Roda. DI= ************************************************************ TI=\PLANNER SCHEDULE RE: TONY BONGIOVI MEETING @ WILDWOOD IM=114P01.CPR DA= July 10, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: The planner schedule exhibits a meeting between Stan Caterbone and Tony Bongiovi for July 10, 1987. Stan Caterbone was trying to desperately keep any business activities that he had in tact. However, the allegation of insanity has reached virtually all of his business

contacts and network. DI= ************************************************************ TI=\W. UMIKER TRUSTEE TERMINATION IM=115P01.CPR DA= July 10, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 2 SU= SUMMARY: Notices to Stanley J. Caterbone, from Dr. and Mrs. William Umiker canceling the Trust Agreements dated October 17, 1986 which had designated Stanley J. Caterbone as Trustee and Robert F. Kauffman as Alternate Trustee. Again, Stan Caterbone had never learned why such action was taken. IM=115P02.CPR DI= PAGE 02 DI= ************************************************************ TI=\HARSCO PENSION PLAN DOCUMENTATION IM=116P01.CPR DA= July 13, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/04/07/08 PA= PAGES: 7 SU= SUMMARY: A note and information from Robert O. Ackerman of the Mesirow Brokerage Services, Inc., regarding Stan Caterbone's efforts at providing management services for the $141 Million Pension Plan of Harco, of Harrisburg PA. The pension fund was paying out over $350,000 in annual management fees, of which Stan Caterbone was competing for. IM=116P02.CPR DI= PAGE 02 IM=116P03.CPR DI= PAGE 03 IM=116P04.CPR DI= PAGE 04 IM=116P05.CPR DI= PAGE 05 IM=116P06.CPR DI= PAGE 06 IM=116P07.CPR DI= PAGE 07 DI= ************************************************************ TI=\HARSCO PENSION PLAN REPORT OF EXAMINATIONSIM=117P01.CPR DA= July 13, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/04/08 PA= PAGES: 6 SU= SUMMARY: The Report on Examinations of Financial Statements for the Harsco Pension Fund. The report gives a detailed accounting of all Pension funds, along with performance results. This report was supplied by Michael Dipaolo of while employed by Coopers & Lybrand, of Harrisburg, PA

IM=117P02.CPR DI= PAGE 02 IM=117P03.CPR DI= PAGE 03 IM=117P04.CPR DI= PAGE 04 IM=117P05.CPR DI= PAGE 05 IM=117P06.CPR DI= PAGE 06 DI= ************************************************************ TI=\SOLFOLK LIBRARY RESEARCH MATERIALS RE:LENDER LIABILITY IM=118P01.CPR DA= July 15, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 6 SU= SUMMARY: On July 14, Stan Caterbone and Michelle Hodge, personal friend, and one of few persons to believe Stan Caterbone traveled to Boston, MA. Stan Caterbone had decided that Boston would offer one of the better Law Libraries for research, and would provide for a nice trip to get away from all of the conspiracy going on. Stan Caterbone had conducted research on the topic of lender liability, and specifically the circumstances which constitute fair play, illegal repossession, and anti trust with specific his mortgage banking business. Enclosed are samples. IM=118P02.CPR DI= PAGE 02 IM=118P03.CPR DI= PAGE 03 IM=118P04.CPR DI= PAGE 04 IM=118P05.CPR DI= PAGE 05 IM=118P06.CPR DI= PAGE 06 DI= ************************************************************ TI=\KUAFFMAN LETTER TO BILL JOHNSON RE: S. CATERBONE IM=119P01.CPR DA= July 16, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: Robert Kauffman had sent a letter to Millard Johnson, as well as all of the clients of Stan Caterbone. Robert Kuaffman had alleged that Stan Caterbone will not be servicing Financial Management Group, Ltd., clients in the Lancaster area, and "may not handle investments at all". Robert Kauffman had also reported that Stan Caterbone had moved his office to Stone Harbor, NJ. Stan Caterbone has yet to learn motivation for such incriminating statements, that could be construed as freud in and of themselves. DI= ************************************************************

TI=\NASD-SEC PHONE LOG FOR HELP IM=120P01.CPR DA= July 17, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 2 SU= SUMMARY: Phone log of Stan Caterbone, for the date of July 16,1987 After receiving the letter from Millard Johnson, relating to lies that Robert Kauffman was telling the clients of Stan Caterbone, Stan Caterbone proceeded to call the Federal and State Authorities of the Securities and Exchange Commissions. As with the attorneys, Stan Caterbone received no help, and on the contrary received more ridicule and suspicion than anything. IM=120P02.CPR DI= PAGE 02 DI= ************************************************************ TI=\SCHWELLER INVOICE FOR LEGAL FEES IM=121P01.CPR DA= July 17, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 2 SU= SUMMARY: Invoices from attorney Lew Schweller, of the law firm Valore, McAllister, Westmoreland, Gould, Vesper & Schwartz. IM=121P02.CPR DI= PAGE 02 DI= ************************************************************ TI=\PLANNER SCHEDULE RE: GAMILLION STUDIOS MEETING IM=123P01.CPR DA= August 20, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: The planner outlines Stan Caterbone's meeting with Marcia Silen, of Flatbush Films, Ted Gamillion, of Gamillion Studios, and Becky Austin, of Arlington Properties, all of surrounding Hollywood, CA. Stan Caterbone had traveled to Hollywood and had conducted meetings with the above individuals. Becky Austin was interested in developing a mortgage banking business. Ted Gamillion was interested in having Stan Caterbone restructure and refinance his film and sound studio. Even 3,000 miles away, the efforts proved to be fruitless DI= ************************************************************ TI=\GAMILLION STUDIOS FINANCIAL DOCUMENTS (CENSORED)IM=124P01.CPR DA= July 20, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 4 SU= SUMMARY: A sampling of the documents that Ted Gamillion of

Gamillion Studios had given to Stan Caterbone during his visit of July 20, 1987 to support his efforts to restructure and refinance Gamillion Film & Sound Studios. Stan Caterbone and Marcia Silen had spent several hours touring and inspecting the studios and its business activities. The alleged allegations had eventually traveled as far away as Hollywood, CA. This was the last attempt to conduct any kind of business. IM=124P02.CPR DI= PAGE 02 IM=124P03.CPR DI= PAGE 03 IM=124P04.CPR DI= PAGE 04 DI= ************************************************************ TI=\SCHWELLER INVOICE FOR LEGAL FEES IM=125P01.CPR DA= July 20, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: Invoices from attorney Lew Schweller, of the law firm Valore, McAllister, Westmoreland, Gould, Vesper & Schwartz. DI= ************************************************************ TI=\CAPPELLO & FOLEY RECEIPT FOR MATERIALS IM=126P01.CPR DA= July 21, 1987 SU= SUMMARY: Invoice dated July 21, 1987 from Joan M. Tornes, of the law firm of Cappello & Foley, for 3 binders of documents which Stan Caterbone had personally delivered to the offices at 831 State Street, Santa Barbara, CA. Cappello and Foley were discovered during the research on Lender Liability, as being one of the more prominent firms to specialize in Lender Liability. Stan Caterbone was especially about the activities of Commonwealth Bank considering the Olde Hickory refinance, and also Fulton and Farmers First. DI= ************************************************************ TI=\RODA INVOICE FOR LEGAL FEES IM=127P01.CPR DA= July 22, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 3 SU= SUMMARY: Invoice from attorney Joseph Roda, for services from July 1, 1987 through July 7, 1987, which included the phone conversation in which Joseph Roda accused Stan Caterbone of fabricating any and all allegations. IM=127P02.CPR DI= PAGE 02 IM=127P03.CPR DI= PAGE 03 DI= ************************************************************

TI=\TITLE: SOURCE CAPITAL LETTER RE: BENNET WILLIAM SYNDICATION IM=129P01.CPR DA= July 24, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 10 SU= SUMMARY: A letter to Jim Bly, of Source Capital, of McLean VA from Stan Caterbone along with the syndication deal for the Bennett Williams project. Dave Cook and previously expressed interest in the project, however a few days prior, Dave Cook had informed Stan Caterbone that it "would be better if I did not associate with you". Stan Caterbone was about all out of business contacts that were not convinced that he embezzled monies and was insane. IM=129P02.CPR DI= PAGE 02 IM=129P03.CPR DI= PAGE 03 IM=129P04.CPR DI= PAGE 04 IM=129P05.CPR DI= PAGE 05 IM=129P06.CPR DI= PAGE 06 IM=129P07.CPR DI= PAGE 07 IM=129P08.CPR DI= PAGE 08 IM=129P09.CPR DI= PAGE 09 IM=129P10.CPR DI= PAGE 10 DI= ************************************************************ TI=\HARTLETT LETTER TO CREDITORS RE: S. CATERBONEIM=130P01.CPR DA= July 24, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: Letter from Michael Hartlett, Executive Vice President of FMG, Ltd., to Oblenders, of Lancaster PA informing Oblenders that "Stanley J. Caterbone is no longer an officer of our corporation." "He was removed as Executive Vice President on July 1, 1987". "This letter serves notice that Stanley J. Caterbone never has had the right to: 1) Purchase items for or through FMG. 2) Make Corporate commitments on behalf of FMG 3) Contract for or any way obligate FMG Ltd." A third grader would be smarter than this. DI= ************************************************************ TI=\SHIRK LETTER RE: BANKRUPTCY MATERIALS IM=131P01.CPR DA= August 5, 1987

AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 2 SU= SUMMARY: A letter from Dore Valvanes, of the law firm of Shirk Reist, Wagenseller, and Shirk, of Lancaster PA to Stan Caterbone in reference to a conversation held on the same day of August 5, 1987. The letter indicates that bankruptcy should be seriously considered as an an alternative. In the letter, Dore Valvanes also gives several reasons why the law firm of Shirk, Reist, Wagenseller, and Shirk would rather not get involved. IM=131P02.CPR DI= PAGE 02 DI= ************************************************************ TI=\BILL TELL FAX REQUESTING DAT PURCHASE FROM JAPAN IM=132P01.CPR DA= August 5, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: A copy of a fax from Stan Caterbone, while in Stone Harbor NJ, to Bill Tell, client of FMG, Ltd., while in Osaka, Japan. Bill Tell is the owner and president of PDQ Industries, of Brownstown PA. The fax was to inform Bill Tell of the Gamillion Studios refinancing. It was thought that the project might even have more appeal with the Japanese. Stan Caterbone also requests the purchase of an R-DAT digital Recorder, for the Studio. DI= ************************************************************ TI=\COMMONWEALTH BANK SETTLEMENT RE: PLAN REPOSSESSION IM=133P01.CPR DA= August 7, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: A letter to Stan Caterbone from John M. Wolf, Vice President of Commonwealth National Bank, A Mellon Bank. The letter refers to a telephone conversation between Stan Caterbone and Mr. Irwin H. Siegel, Consumer Loan Manager, of Commonwealth Bank regarding Stan Caterbone's demand for a settlement of $5 Million for the numerous lender liability violations suffered while the aircraft was illegally repossessed. The demand was rejected because "we are satisfied that the repossession was both lawful and appropriate". DI= ************************************************************ TI=\CREDIT REPORT OF S. CATERBONE IN AUGUST OF 1987 IM=CR1.CPR DA= August 7, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: A copy of the Credit Report that Stan Caterbone had

requested from Kelly Walters, of the Credit Bureau of Lancaster County, Inc.,. Stan Caterbone was tired of hearing all of the alleged bankruptcy rumors, so he wanted to document his actual credit rating. The Credit Report was received August 7, 1987, and was considered valid until the same. The Credit Report was absolutely flawless, reporting that all accounts were "Pays (or paid) within 30 days of billing, pays accounts as agreed". IM=CR2.CPRDI= PAGE 2IM=CR3.CPRDI= PAGE 3IM=CR4.CPRDI= PAGE 4DI= ************************************************************ TI=\MMPI EVALUATIONIM=135P01.CPR DA= August 7, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 8 SU= SUMMARY: In efforts to rescind the allegations of insanity that everyone was blatantly accusing Stan Caterbone of possessing, Stan Caterbone had selected a Psychiatrist from the Yellow Pages of the telephone book. He chose Dr. Marshall Levin, of Northfield, NJ. The documents are a sampling of the 530 question test that Dr. Levine used to evaluate the mental state of mind of Stan Caterbone. This meeting was conducted at 554 Berkley Road, Stone Harbor, NJ. The test was an exercise in futility. Dr. Levine had ruled Stan Caterbone mentally ill. IM=135P02.CPR DI= PAGE 02 IM=135P03.CPR DI= PAGE 03 IM=135P04.CPR DI= PAGE 04 IM=135P05.CPR DI= PAGE 05 IM=135P06.CPR DI= PAGE 06 IM=135P07.CPR DI= PAGE 07 IM=135P08.CPR DI= PAGE 08 DI= ************************************************************ TI=\FMG, Ltd., CRIMINAL ARREST THREAT TO S. CATERBONE IM=136P01.CPR DA= August 10, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 2 SU= SUMMARY: A letter to Stan Caterbone from the "Board of Directors" of FMG, which was actually signed by Robert Long.

The letter alleges the following: that Stan Caterbone is in debt; that any future sale of his stock will be reduced by the build up of any future debt; that any stock sale will be reduced "by the time and costs in dealing with either guardians or your pending bankruptcy"; and finally FMG threatens criminal charges for attempted embezzlement burglary, employee theft, with a long prison term. Also the filing of the preceding charges has nothing to do with our current stock negotiations". IM=137P02.CPR DI= PAGE 02 DI= ************************************************************

TI=\TITLE: KAUFFMAN LETTER TO S. CATERBONE RE: SHUT-OUT IM=137P01.CPR DA= August 10, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: A letter to Stan Caterbone from Robert Kauffman advising Stan Caterbone that Robert Kauffman and other FMG management will "not personally discuss any matters regarding your past affiliates and stock proposal with our firm". DI= ************************************************************ TI=\INVOICE FOR CAR PHONE INSTALLATION IM=138P01.CPR DA= August 11, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: The invoice is for the installation of a car phone in the Volkswagen of Stan Caterbone. Warcom Inc., of Absecon, NJ. While driving home, Stan Caterbone had called Mary Lynn Dipaolo, who made numerous allegations pertaining to his mental condition. Stan Caterbone had told Mary Lynn Dipaolo that he was going back to Hollywood to try to work on the Gamillion Studios deal. In the proceeding document, the psychiatrists refer to having hallucinations about being a "Film Exec". DI= ************************************************************ TI=\SUICIDE ALLEGATIONS, IMPRISONMENT, HOSPITALIZATION IM=139P01.CPR DA= August 11, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 10 SU= SUMMARY: On August 11, 1987 Family members of Stan Catebone had come to Stone Harbor to attempt to get Psychiatric help for Stan Caterbone. In what turned into a heated and excited confrontation, Stan Caterbone had ran block away to the Stone Harbor Police Department in order to issue a restraining order against the said family. In contrary the Stone Harbor Police imprison Stan Caterbone, and take him to the Berdette Tomlin Hospital, sirens and all and

admit Stan Caterbone on allegations that he "was going to California to Kill himself, as did his brother". Sources have said that the phone call to the Stone Harbor Police was was made by Jere Sullivan and/or Mary Lynn DiPaolo.IM=139P02.CPR DI= PAGE 02 IM=139P03.CPR DI= PAGE 03 IM=139P04.CPR DI= PAGE 04 IM=139P05.CPR DI= PAGE 05 IM=139P06.CPR DI= PAGE 06 IM=139P07.CPR DI= PAGE 07 IM=139P08.CPR DI= PAGE 08 IM=139P09.CPR DI= PAGE 09 IM=139P10.CPR DI= PAGE 10 DI= ************************************************************ TI=\AVOLON POLICE DEPARTMENT ARREST RECORD IM=140P01.CPR DA= August 14, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 4 SU= SUMMARY: On the evening of August 14, 1987, persons again invade Stan Caterbone's house in Stone Harbor and make repeated questions and allegations insinuating that Stan Caterbone had done something to get into such trouble, not to his mental state of mind. Stan Caterbone had proceeded to the Avalon Police Department in hopes of ordering a restraining order, as he did with the Stone Harbor Police, a few days earlier. However, on the way Stan Caterbone was arrested for speeding, an completely dry beer can under the seat, and a bottle of muscle relaxers. IM=140P02.CPR DI= PAGE 02 IM=140P03.CPR DI= PAGE 03 IM=140P04.CPR DI= PAGE 04 DI= ************************************************************ TI=\SCHWELLER INVOICE FOR LEGAL FEES IM=141P01.CPR DA= August 18, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 2 SU= SUMMARY: Invoice from attorney Lew Schweller for services up to August 3, 1987. IM=141P02.CPR

DI= PAGE 02 DI= ************************************************************ TI=\BILL JOHNSON DEMAND NOTE WITH S. CATERBONEIM=142P01.CPR DA= August 21, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: A copy of the Confession of Judgement for the note of $25,000 with Bill Johnson for the loan to Stan Caterbone for the purchase of the aircraft. This note was paid in full by July 31, 1988 by Stan Catebone. DI= ************************************************************ TI=\KAUFFMAN LETTER RE: PATTERSON GUARDIANSHIPIM=143P01.CPR DA= August 24, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: A letter from Robert Kauffman to Millard Johnson a message that Bill Jonson had left for Robert Kauffman. Robert Kauffman had earlier tried to persuade Bill Johnson to provide testimony that the $25,000 that Bill Johnson had loaned to Stan Caterbone, was actually monies that Bill Johnson had given to Stan Caterbone to invest, and Stan Caterbone had actually embezzled the monies. Bill Johnson almost threw Robert Kuaffman through the window. Robert Kauffman then told Bill Johnson that FMG was responsible for the debt. DI= ************************************************************ TI=\LEGAL ISSUES PERCEIVED BY S. CATERBONE IM=144P01.CPR DA= August 25, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 14 SU= SUMMARY: Stan Caterbone had formalized legal actions against all those that were obvious members of the conspiracy. Notice should be taken that persons from FMG, Ltd, and the banks have completely diverted attention away from James Guerin and ISC. IM=144P02.CPR DI= PAGE 02 IM=144P03.CPR DI= PAGE 03 IM=144P04.CPR DI= PAGE 04 IM=144P05.CPR DI= PAGE 05 IM=144P06.CPR DI= PAGE 06 IM=144P07.CPR DI= PAGE 07 IM=144P08.CPR

DI= PAGE 08 IM=144P09.CPR DI= PAGE 09 IM=144P10.CPR DI= PAGE 10 IM=144P11.CPR DI= PAGE 11 IM=144P12.CPR DI= PAGE 12 IM=144P13.CPR DI= PAGE 13 IM=144P14.CPR DI= PAGE 14 DI= ************************************************************ TI=\SYDER FUNERAL HOME DEAL WITH SCOTT ROBERTSON IM=145P01.CPR DA= August 26, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: A contract between Scott Robertson and Stan Caterbone for the sharing of income received from the account of the Chip Snyder & Associates Funeral Trust Accounts. Chip Snyder and his family had recently vacationed in Avalon, NJ. Chip Snyder was a friend of Stan Caterbone's and was quite curious as to what was going on. Stan Caterbone had described the real circumstances and events and Doreen Snyder had actually begun to throw up after hearing the truth. Scott Robertson in the middle of trying to get Chip Snyder to transfer the account to FMG. DI= ************************************************************ TI=\LETTER TO DIANE SAWYER OF 60 MINUTES BY S. CATERBONE IM=146P01.CPR DA= August 28, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: A letter to Diane Sawyer from Stan Caterbone in efforts to receive some kind of help regarding the conspiracy and blackmail. By this time, all conventional methods of pleading for help from local, state, federal, and even legal authorities have been exhausted and have proven fruitless, not to mention exhausting. DI= ************************************************************ TI=\FEDERAL EXPRESS INVOICE TO 60 MINUTES IM=147P01.CPR DA= August 28, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: A Federal Express Invoice to Stan Caterbone confirming the receipt of a letter delivered overnight to Diane Sawyer of CBS 60 Minutes, accepted by D. Parker. DI= ************************************************************

TI=\RODA INVOICE FOR LEGAL FEES IM=148P01.CPR DA= September 2, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: A letter from attorney Joe Roda to Stan Caterbone requesting payment for services rendered from July 1, 1987 to July 22, 1987. Mention was also made to the copy charges advanced on the behalf of Stan Caterbone. Joe Roda asked for the immediate attention of Stan Caterbone. DI= ************************************************************

TI=\STATE POLICE PHONE DIRECTORY FOUND IN THE HOME OF S. CATERBONEIM=328.CPRDA= September 3, 1987PA= PAGES: 1

SU= Upon the arriving home at 2323 New Danville Pike, Conestoga, PA, from Stone Harbor, Stan Caterbone found notes that were left by Jim Warner. Jim Warner was living in his house upon being transferred from New Jersey. The notes contain the phone numbers of several state police departments; including Avondale, Philadelphia, New Jersey, Delaware, and Pennsylvania. It should be noted that James Warner was working on the Lancaster County Waste Management Authority Incinerator Bond Issue. The attorney representing Mr. Warner was Steven Spinello, the same attorney that apparently negotiated the ISC -- Ferantti Merger & Acquisition, for James Guerin, during the summer of 1987, and settled in November of '87.

Ironically, the firm that was awarded the underwriting for the Bond issue was Hopper Soliday, of which Gib Armstrong is an executive. Gib Armstrong had sold Stan Caterbone the original ISC stock, while working for Individual Securities. Stan Caterbone had also called Gib Armstrong in July of 1987, pleading for help, and discussing the circumstances regarding his "Blackmail". Gib Armstrong had said he would call the Pennsylvania Attorney General's Office, of course he never did anything.

James Warner also had called Tom Caterbone, brother of Stan Caterbone, on or about December 16. 1990 to question whether Stan Caterbone was taking his medication, and to insinuate that Stan Caterbone was again having another relapse of his "alleged insanity". This had occurred after Stan Caterbone had publicly acknowledged that it had come time to resolve any and all related implications that had promulgated from the "Blackmail" of 1987. Stan Caterbone had also told Jim Warner on the evening of December 12, 1990 that he was producing an interactive CD-ROM disc that contained all relevant documentation and all recorded conversations pertaining to the same.DI= ************************************************************ TI=\MANHIEM TOWNSHIP CRIMINAL CHARGES IM=149P01.CPR DA= September 3, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1

SU= SUMMARY: Formal Criminal Charges of Terroristic Threats filed by Complainant Detective Larry C. Siegler, of the Manheim Township (Political Subdivision) Police, Commonwealth of Pennsylvania against Stanley J. Caterbone, Defendant. A Criminal Complaint was filed on September 3, 1987 for an alleged "Terroristic Threat" that occurred sometime on September 1, 1987. It was so "Terroristic" that it took 2 days to phone police, and June Kemper, who allegedly took the call, could only recall the time between 9am-12p DI= ************************************************************ TI=\MANHIEM TOWNSHIP CRIMINAL CHARGES II IM=150P01.CPR DA= September 4, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 2 SU= SUMMARY: Formal Criminal Charges of Burglary, Criminal Mischief and Theft and Use of Computer, Unlawful Restraining, and Robbery, filed by Detective Larry Mathias, Criminal Complainant, of the Manhiem Township (Political Subdivision) Police, filed by District Justice Murray Horton, Magistrate District 02-1-02 against Stanley J. Caterbone. All charges against Stan Caterbone are in essence and by Pennsylvania Securities and Contract Law are charges for burglarizing his own leased property and stealing his own corporate and business files. IM=150P02.CPR DI= PAGE 02 DI= ************************************************************ TI=\PRISON RECEIPT FOR ARTICLES AT LANC. COUNTY PRISON IM=151P01.CPR DA= September 4, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: The actual Prison Receipt of Stan Caterbone upon being stripped of his clothing, and demanded to take a cold shower, after which he already suffered a recurring hyperthermia, after being "thrown" in the Manhiem Township holding cell with little clothing, on a night of already record low temperatures. Stan Caterbone was denied any phone calls to attorneys or others for bail. DI= ************************************************************ TI=\LANCASTER NEWSPAPERS REPORTS OF S. CATERBONE IM=152P01.CPR DA= September 4, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: "CONESTOGA MAN LINKED TO THEFT" and "EX-WORKER CHARGED IN BURGLARY AT FIRM" were the reports published in the Lancaster New Era, and the Lancaster Intelligencer Journal, owned by the Steinman Family. Articles read as

follows: "A 29-year-old Conestoga man was arrested Thursday night on charges that he erased information from a Manhiem Township company's computers, stole files and damaged equipment. Stanley J. Caterbone 29, of 2323 New Danville Pike, was charged with burglary, theft, unlawful use of a computer, criminal mischief and terroristic threats. Detective Larry Mathias said the victim, Financial Management Group, Ltd., 1755 Oregon Pike, lost an estimated $60,000 as a result of Caterbone's actions. Caterbone allegedly forced a cleaning person, Stacy L. Waters, 19, of Lititz, to accompany him through the business during the crimes. He also was served a warrant for terroristic threats in a case involving employee of the company, was committed to prison in lieu of $30,000 bail.DI= ************************************************************ TI=\PRISON REQUESTS OF S. CATERBONE IM=153P01.CPR DA= September 4, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 10 SU= SUMMARY: "General Purpose Request Form" used to make requests in the Lancaster County Prison that Stan Caterbone used during his stay from September 4, 1987 to September 9, 1987. The forms continue the quest by Stan Caterbone to receive additional clothing and medication due to the extreme exposure to cold that the Manheim Township Police and the Lancaster County Prison used as a means to intimidate Stan Caterbone. Stan Caterbone also requests guest privledges for attorney Tim Lanza, attorney Jeff Jamouneau, Mary L. Dipaolo, Bill Johnsons and Diane Sawyer. IM=153P02.CPR DI= PAGE 02 IM=153P03.CPR DI= PAGE 03 IM=153P04.CPR DI= PAGE 04 IM=153P05.CPR DI= PAGE 05 IM=153P06.CPR DI= PAGE 06 IM=153P07.CPR DI= PAGE 07 IM=153P08.CPR DI= PAGE 08 IM=153P09.CPR DI= PAGE 09 IM=153P10.CPR DI= PAGE 10 DI= ************************************************************

TI=\OLD HICKORY REAL ESTATE APPRAISAL IM=154P01.CPR DA= May 25, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 14

SU= SUMMARY: The appraisal package submitted to Stan Caterbone from Norris Boyd of Boyd Wilson. The appraisal was performed on Olde Hickory Properties, located on Oregon Pike. Noriss Boyd had requested a proposal to refinance an existing mortgage held by Commonwealth National Bank. Al Dannatt had traveled from Houston, Texas, to inspect the properties for preliminary due diligence procedures. A propose was officially submitted for the procurement of approximately $5 million dollars. Noriss Boyd had communicated to Stan Caterbone that the terms were more favorable than those submitted by the Commonwealth National Bank, which subsequently reposed his the Navojo Chieftain aircraft, 23 days before the first payment, at 9:30 pm on July 3, will all personal and business files on board! IM=154P02.CPR DI= PAGE 02 IM=154P03.CPR DI= PAGE 03 IM=154P04.CPR DI= PAGE 04 IM=154P05.CPR DI= PAGE 05 IM=154P06.CPR DI= PAGE 06 IM=154P07.CPR DI= PAGE 07 IM=154P08.CPR DI= PAGE 08 IM=154P09.CPR DI= PAGE 09 IM=154P10.CPR DI= PAGE 10 IM=154P11.CPR DI= PAGE 11 IM=154P12.CPR DI= PAGE 12 IM=154P13.CPR DI= PAGE 13 IM=154P14.CPR DI= PAGE 14 IM=154P15.CPR DI= PAGE 15 DI= ************************************************************ TI=\BAIL BOND FOR S. CATERBONE DA= September 9, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 01 SU= SUMMARY: Copy of the Bail Bond, executed by Indiana Lumbermans Insurance Company represented by Alfredo Marchio, of 529 Cherry St., Reading PA. The Bail was $20,000.00 or $1400.00 for the Surety Bond. The Bail was set up by Mary Lynn Dipaolo. Stan Caterbone was transported

directly to the St. Joseph Hospital Mental Health Unit BY Mike Caterbone, and Mary Lynn Dipaolo. The condition for Stan Caterbone to get the Bail Bond, was that Stan Caterbone must voluntarily admit himself into the St. Joseph Mental Health Unit, as confirmed by Robert Byers. DI= ************************************************************ TI=\ST. JOSEPH HOSPITAL MENTAL HEALTH GUIDE IM=155P01.CPR DA= September 10, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 7 SU= SUMMARY: A copy of the "Inpatient Mental Health Unit Patient Guide". The guide also includes notes written by Stan Caterbone that gives indications of guilt by association. IM=155P02.CPR DI= PAGE 02 IM=155P03.CPR DI= PAGE 03 IM=155P04.CPR DI= PAGE 04 IM=155P05.CPR DI= PAGE 05 IM=155P06.CPR DI= PAGE 06 IM=155P07.CPR DI= PAGE 07 DI= ************************************************************ TI=\ST. JOSEPH HOSPITAL INVOICE IM=156P01.CPR DA= September 25, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: A letter and copy of the invoice for the Hospital bill of Stan Caterbone for $3,064.60 for the stay from 09/09/87 to 09/14/87. DI= ************************************************************ TI=\LETTER TO CAPELLO & FOLEY IM=157P01.CPR DA= September 29, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: A letter from Stan Caterbone, form Diane Campbell, of law firm of Capello & Foley, Santa Barbara CA, enclosing a copy of the newspaper articles of Stan Caterbone's Criminal Charges, and sarcastically thanking them for all of their help. DI= ************************************************************ TI=\PENNSYLVANIA SECURITIES COMMISSION MEETING TRANSCRIPT IM=159P01.CPR

DA= September 29, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 27 SU= SUMMARY: A copy of the actual recorded transcript fron the investigation of the Pennsylvania Securities and Exchange Commission, conducted at 2323 New Danville Pike Conestoga, PA. Howard Eisler conducted the meetings from 10:00am to 2:30pm. Stan Caterbone discusses all circumstances and or events include Commonwealth Bank, Manheim Township Police, Larry Mathias, Larry Siegler, Joe Roda, Lancaster Aviation, Farmers First, Jeff Jamouneau, Lancaster New Era, Kauffman, Hartlett, FMG, Ltd., Loss, Long, Peneros, Robertson, Olde Hickory, Boyd. DATE: SEPTEMBER 29, 1987 TIME: 10:00 AM PLACE: RESIDENCE OF STAN CATERBONE 2323 NEW DANVILLE PIKE CONESTOGA, PA 17543 PERSONS: <STAN CATERBONE> COMPLAINANT <ROBERT BEYER> ATTORNEY REPRESENTING STAN CATERBONE <BILL JOHNSON> CLIENT OF STAN CATERBONE & FMG, Ltd., <HOWARD EISSLER> INVESTIGATOR FOR PENNSYLVANIA SECURITIES COMMISSION <STAN CATERBONE> I still am the minor one - <HOWARD EISSLER> yes, the Financial Management Group -there is about 50 names I am dealing with here and they are all very similar so I have to be --- Financial Management Group Ltd. filed for 202B exemption. Now all the security sold in PA had to be registered. Some securities are exempt but you have to apply the detention type of thing. It is a registration, not a registration that __________ so the 203D exemption was filed for. Of course we have added the security statement - explanation of where the money is going to be spent, how it is going to be run, who runs the corporation and all that sort of thing. Now under the umbrella of this Financial Management Group there is a whole (now I am repeating what is in the 203D which I spent some time Friday reading) - there is about 15, 14 - I guess under that there is about 5 other corporations which are going to be an insurance agency, an investment advising agency, a group - <STAN CATERBONE> now a lot of these things have not come about. Well we simplified it. <HOWARD EISSLER> What do you mean simplified it? <STAN CATERBONE> They are operating but because of the accounting procedures they would have been a

nightmare with all those stubs. <HOWARD EISSLER> So, they are operating - <STAN CATERBONE> the only one that's separate distinction is the IRA. Everything else is operating under Financial Management Group Limited. <HOWARD EISSLER> So these other corporations have not really come into being. <STAN CATERBONE> Technically, legally, no. <HOWARD EISSLER> I seen also, I guess there is an application for an investment advisor. Now, if you are selling securities or dealing with __________. Now that came in under your name... <STAN CATERBONE> at that time I was President, <HOWARD EISSLER> but now there is another application in that is being acted on now by somebody else. <STAN CATERBONE> There is? <HOWARD EISSLER> I don't know who. <STAN CATERBONE> Is that for the advisor? <HOWARD EISSLER> Yes, the investment advisor. <ROBERT BEYER> Do your current records in Harrisburg indicate that he is still an executive with FMG? <HOWARD EISSLER> Yes, because this offering memorandum was given back last March I think, - last August - when I initially did it. Oh, no, pardon me. We are talking about two different things. You are talking about your application for the investment advisor. <STAN CATERBONE> No, I am talking about FMG - the offering memorandum was done last August because that's when I started raising the money. August of 1986 is when I did the initial filing for the offering memorandum - the 144 Reg D. Coming up this October is the 203D, 15 months after conception. <HOWARD EISSLER> Alright, yea. There is a report that is due a year after - <STAN CATERBONE> Right, that's what is coming up - <HOWARD EISSLER> to explain how much money was raised and where it was spent with the idea then of protecting investors. The idea of the _________ your are limited to like 35 investors. You can't sell to 105 - you

are limited. What the state does is comes in and says, how are you going to raise the money in your offering memorandum. Then a year after it is raised, or a year after _________ they come in and say, now what did you do with the money. You raised 4 hundred and some odd thousand, now how did you spend it? Now that has not been filed yet. <STAN CATERBONE> It is due, in fact I think it is overdue. It is due October 20. I got the letter right here. They just sent me the letter. You guys just sent me the letter, I have it right here. <HOWARD EISSLER> I have nothing to do with that end of it. I just came, well whenever I called you _____ I didn't get a hold of you the next day; it was the following day which was Friday that we made contact. <ROBERT BEYER> Our idea in coming here was to let you ask whatever questions you had in terms of the investigation. Of my limited knowledge of the type of securities these guys deal with and securities in general, the things that came to interest me was the fact that there are stock certificates in here in force with names on them that ________, that there are with the annual report, his name is forged by someone else.

This gentleman has some involvement with the original group and the President suggested that he make false reports to the bonding company so that he can get money back. They are the three things that stuck out to me as a regular criminal attorney, that I thought you might be interest in because, but like I say, we are here to have you ask questions of anything that you might. <HOWARD EISSLER> O.K., this offering then - when Financial Management Group limited applied for their 203D, I get the idea they were going to raise four hundred and some odd thousand dollars. At that time, they listed Bob Kauffman at 60,000 shares and you and Hartlett 40,000 a piece. So, Kauffman at this point is the main factor? Or, when I was talking to you, it was really your idea that put this whole thing together. <STAN CATERBONE> I put it all together. I brought him up from Atlanta to be president because I have a lot of business interests and I didn't want to be tied down to the day-to-day operation. Plus, I never had any management experience. Most of my work was consulting, business deals, this and that, so I actually brought him up from Atlanta to be president. <HOWARD EISSLER> And, Hartlett - is he a complete local person. He's local. <STAN CATERBONE> We all started together in IDS back in 1982.

<HOWARD EISSLER> That's your connection with Kauffman, you know him through IDS? <STAN CATERBONE> He's the one that got me started in business. I am the one who took him to FSC, that was our broker/dealer and we started putting it together. <HOWARD EISSLER> Are they registered as FSC? <STAN CATERBONE> Yes, that's John Keeble. <HOWARD EISSLER> This similarity in names is a hassle; you are going to have to bear with me because you throw these names out at me -----. So then, you had the public offering which you were going to sell another 120,000 shares and raise $435,000. That would be in addition to what you people put in. <STAN CATERBONE> We put in 20 grand a piece. Well, we had 5 people. You were allowed 5 shareholders - so we put in 5. Five put in 100,000 - <HOWARD EISSLER> five at 20,000 you mean? <STAN CATERBONE> No, it was a little bit more than that. Three of us put in 20; two put in 25. <HOWARD EISSLER> What we are talking roughly is one half million dollars? <STAN CATERBONE> Right. <HOWARD EISSLER> Financial Management Group now is responsible for maintaining proper control over that money and it would be invested as 5 - now I don't know how many people - <STAN CATERBONE> there is roughly 18-25 - that was sold as a result of the public offering. <HOWARD EISSLER> I have that here. <ROBERT BEYER> Do you mind if I look at it. <HOWARD EISSLER> That's o.k. I went through a half hour of frustration to get here. I wasn't running late until I got caught in the ______. The way you described it, I assumed it was going to be in the country and I knew...I stopped at the Post Office. I said where is 2300 New Danville Pike. I don't know. I was here on Friday and I drove past it this morning. You'll bear with me then. This is interesting. I've got about 40 shareholders. Is this as a result of the 203 deal?

<STAN CATERBONE> Yes. <HOWARD EISSLER> Did you know about that. These are all the ones that are forged by the other guys? <STAN CATERBONE> No, no, just one is forged. <HOWARD EISSLER> Now, you people were acting as your own sales _________. Were those funds all properly accounted for? Were they all collected and put in the bank and the people received their stock certificates. <STAN CATERBONE> Uh, huh. <HOWARD EISSLER> Who all would have been in charge of that. Mainly me. I was in charge of just about everything. Now, we have one-half a million dollars or there about in the bank account. <HOWARD EISSLER> Where? <STAN CATERBONE> They never would show me the book - my partners - never. They never showed anyone the books to this day. I got shut out literally. <HOWARD EISSLER> What brought that about? <STAN CATERBONE> They were trying to take the company from me from day one. I had too much power, too much control. They wanted to cheat and be dishonest and I wouldn't. What happened was we had to acquire an interest in a broker/dealer to assume our equity, to realize our equity potential. So back in January, we drummed up this deal with a broker/dealer called Hibbard and Brown out of DC.

The deal was we were going to acquire 20% of their broker/dealer in return for aligning our group with them. What I found was - I went down there after about 3 weeks of them not doing what we needed, I got scared. I had so much money and time into this company. I went down there myself and found an empty shell - nothing. Now, as a corporate office, I know how liable I am, for everything, personally. Then what I find out is that Hibbard is a born- again, just like Kauffman. <HOWARD EISSLER> Oh, Kauffman is - <STAN CATERBONE> yes. And, Hartlett is a Jehovah Witness. I get pissed off, so I swing the whole board, change everything and I line us with Planner's Security Group in Atlanta - Bill Koegler. Now, in that group is Wade Webster, Bill Carter - all the former IAFP presidents. <EISSLER> IAFP?

<STAN CATERBONE> International Association for Financial Planners - the big guys. So, I swing everything around, turned the whole board over, aligned up with them. The day after I get back from Atlanta, Kauffman calls me into his office and goes through this spiel with "I thought I was president, who's running the company?" I said "I don't care who runs it, it just got to be run right and for the right reason". Two weeks later, I am in New Jersey working on a movie and doing some things - I had my lock changed in my office for security reasons. I find that they have all these stock certificates and everything that were in my office. <HOWARD EISSLER> You had the locks changed? You had them changed yourself, but they still got into your office? <STAN CATERBONE> I don't know how. They stole my files. July 1, I went in and took all my files out of the office and went to an attorney, Joe Roda, and explained what happened. Nothing. I met with attorneys in New York, New Jersey, Boston. I found all these security violations and everything else, but no one could help me. Then, about four weeks later, I called the SEC, the NASD, the FBI, the Attorney General, Senator, Governor, everybody. And, they all think I am bluffing. <BILL JOHNSON> Actually, they all thought he was crazy. <STAN CATERBONE> They all thought I was crazy. And that was started because of Robert Kauffman. That's what he did. The day after I went out and got my files out, he spread rumors that I left the company, that I was thrown out, that I was mentally unstable, that I was spending money. At that same time, I get blackballed by all the local lending institutions. They repossessed my plane three weeks before my first payment, with the files in it, of which a brother of the broker in FMG is one of the lending officers. It gets ugly. That was before he spent the 5 days in jail. I tried to get arrested. I had to. <HOWARD EISSLER> Then after you were arrested, you were in the hospital at St. Joseph. <STAN CATERBONE> I was coerced into going there. <ROBERT BEYER> No, that was my idea. I wanted him in a place where we were going to satisfy the victim so to speak, and the police at one point, that he would still be able to work with them. In reality, he was in the hospital but had his car in the parking lot. He was going to play basketball and come back. He was not committed. He was just there.

<STAN CATERBONE> I walked in to satisfy the bail. <HOWARD EISSLER> Are you on medication? <STAN CATERBONE> No. <HOWARD EISSLER> One of the police officers mentioned to me that he was ___________ and that you are alright now. <ROBERT BEYER> Again, this might be one of these stories coming from FMG. <STAN CATERBONE> What Kauffman did was, back when they started doing this I had a psychiatrist that was my client. I was depressed. I mean they were making a fool out of me in public; they were firing people that were very close to me for no reason other than they were close to me. So I went to Al Schultz, a psychiatrist, because I was depressed. Very normal, given the environment I was thrown in after putting this big thing together then having these guys slam it in my face, then take all the credit for what I did.

He diagnosed me as having bipolar, depression. My father was schizophrenic and my brother committed suicide two years ago. The reason he diagnosed that was because I was on a low, and at previous times he thought I was on a high when I put this company together. So, what I did was, three weeks before July 1, this previous July 1, I told Kauffman that I went to see a psychiatrist because of how depressed I was because of what he and Hartlett were doing. They fed on that, and tried to use that to use as their alibi for what they have done to me. <HOWARD EISSLER> Again, the way I am getting this - I didn't know anything to start with - I just happened to make inquiry at the police office and one said that you were taken medication <STAN CATERBONE> I was not. __________ See, that was all started by Kauffman. He actually he had meetings with my family to have me committed and take guardianship over my assets so he could buy the stocks from them at what ever price he felt like it. <ROBERT BEYER> Incidentally, you may want to point out that as late as mid-August of this year, Kauffman wanted to buy you out for $2.50 a share or something like that. We have that documented. <STAN CATERBONE> Eight weeks prior to that, I was working with the attorneys to do a 5 to 1 split. That makes the stock worth $25. Either he is ripping me off or he is ripping the people off who are paying $25 a share.

<HOWARD EISSLER> The offering as you people had it was 3 ______ prices. It was $5 a share. Was that issue completely sold - that 120,000 shares? <STAN CATERBONE> No. <HOWARD EISSLER> Was the best part of it? <STAN CATERBONE> There was 4 hundred and some thousand sold. <HOWARD EISSLER> Did you buy any of that stock? <STAN CATERBONE> No, I was in the organizational sale. <HOWARD EISSLER> You don't know how that money is being accounted for now. <STAN CATERBONE> I have the corporate books. When I went in there June 30, I mean I was in there. I mean it is not like I went in from the outside; I had a plane and was flying back and forth for me. In fact, what happened was, I was granted a 60-day leave of absence late June with pay. Really, what I wanted to do was meet with legal counsel and find out how I was going to resolve all these problems that I was finding.

What happened was, in June I copied everything in that office (June 30th), and I copied the books. You see, I developed a computer system. So I just took one of the copies - it was a big system. I've got the books. I don't know how accurate they are because the way that the guys kept the records, the accounting is all screwed up too. I have an idea, but I found a lot of money going to people that should not have been. <HOWARD EISSLER> In what way? <STAN CATERBONE>What they did was, there was a lot of Jehovah Witnesses that were hired in that firm - receptionist, cleaning, etc. Then what they did was replace all the staff people that I brought in with their own. Then, there was money going out to a fellow by the name of Tom Turner in Minneapolis.

Now Tom Turner was the biggest divisional manager in IDS. He was terminated by IDS in February because of religious convictions - another born-again. Then I find this guy was making $750,000 a year with IDS and I find FMG loaning him money? <HOWARD EISSLER> Is that what they are going after - in the form of loans? <STAN CATERBONE> Yes.

<HOWARD EISSLER> And, how much money are we talking about going to Tom. <STAN CATERBONE> 12-15 grand. Then, I find checks going to Kauffman's wife. <HOWARD EISSLER> Large amounts? Are you talking a hundred dollars? <STAN CATERBONE> No, a thousand here, $800 here. <HOWARD EISSLER> FSC, which is a registered broker/dealer, was an entity started by you? <STAN CATERBONE> No. What happened was, back in 1983 I had a dinner meeting - I was running the local chapter of the IAFP - and I drummed up a business meeting and had Alex Armstrong. Do you know who Alexandria Armstrong is? Yea. She was one of the most prominent financial planners in the company, a woman from DC. I brought her up to speak and I told her that I wanted to get out of the proprietary business. She said, go talk to John Keeble FSC.

Now, this is when Kauffman, Hartlett, everybody was still at IDS. So, I went an had a meeting at FSC in Atlanta. At this time, Bob Kauffman was the Divisional Manager for IDS in Atlanta. The next thing I know, I left; then he was hired by FSC to be an officer and to run their sales force. <HOWARD EISSLER> Then the idea of the company you are forming up here is to invest other people's money? <STAN CATERBONE> No, it is a one-stop financial entity - provides services in mortgage backing, investment backing, insurance, real estate, taxes, lending, portfolio management, everything. I had it researched legally by a leading patent law firm in Phila. It is definitely the most innovative in the country. There is not a firm in the country offering all the services that we offer. <HOWARD EISSLER> Now, just up the street from your place - _______________________. They are along that line. <STAN CATERBONE> I mean big. We're talking an office of 10,000 sq. ft. right here and 35 people; then we travel all over the country. When I say offering services, we have 2 attorneys in there, we have 2 realtors, 4 insurance people, a portfolio manager, 8 financial planners, 5 brokers - I mean, in depth. Before I left, I was working on mortgage banking. I had started a mortgage banking operation and the minimal loan I wa looking at was $3,000,000. I bet you I bid on

$150,000,000 in the first 6 months of 1987. <HOWARD EISSLER> These were loans that you were going to provide the people with? <STAN CATERBONE> You bet. Where was those funds going to come from? They were coming from the largest biggest insurance companies, the largest pension funds, and some of the largest banks. <HOWARD EISSLER> O.K, you were going to be as a mortgage banking type of thing. <STAN CATERBONE> That is right. <HOWARD EISSLER> You were not lending the money; you were putting the lenders together with the borrowers and you get a finders fee, or whatever. <STAN CATERBONE> Yes. <HOWARD EISSLER> Bill, how did you get into this? You were an initial investor? <BILL JOHNSON> No, I've been with Stan since he started in business in 1982. I had come into some money and I was investing. I had lent Stan some money and things got really screwed up with _____ and all. FMG told me that they were responsible for the money because Stan was an officer of the company and that they would ______________________.

Then, after several meetings with them, they more or less asked me to say to the bonding company (that they took out after June 30th of this year) - they wanted me to tell the bonding company that I gave Stan the money to invest for me and ________ with the funds, which I flat our refused to do. As a matter of fact, I damn near punched Kauffman in the mouth when he was asking me to commit a very serious crime. <HOWARD EISSLER> Now, Kauffman's background, is decent, is it not? <STAN CATERBONE> Clean on paper. I mean he worked for - clean on paper; there's a lot of people after that man. What he did to FSC was, he was double dipping. He was telling FSC that we were going to stay with FSC the rest of our lives; in reality, he was telling me that we were telling them what I wanted them to hear that we were going to do our own broker/dealer so we could obtain our own equity. And then, I find out that he is receiving a salary from FSC up until February this year.

Plus, his salary is in violation of the offering memorandum. Two weeks before I left, he had the Board approve a salary of about 2-3 times what is in the

offering memorandum. <HOWARD EISSLER> Maybe this is why the 203D - they're dragging their feet on this. <STAN CATERBONE> They don't know what to do. I did all that legal work; they don't know how to do it. <HOWARD EISSLER>This offering memorandum we are talking about - I just copied this. This is just happens to be page 9 and 10 because the type of information that is in it. That is the only thing we do not have a copy here of. Well, we have a copy in the office if you need one. It is public information; there is no problem with it. <STAN CATERBONE> So are the books public - I got thrown in jail for trying to get them. <HOWARD EISSLER> Well, we will try to resolve this; it is not going to happen overnight. Who is Kauffman connected with here. <STAN CATERBONE> He called up everybody I know and told them I left the company; told them I was stealing money from clients; told them I was mentally insane. I was doing business everywhere. I was doing business with the Japanese; I was doing business with the President of Sony; I was doing business with High at New York, Boston, Houston. Everybody all over the country heard that I was insane. Everybody.

I've been 4 months without money. I haven't paid a bill since June 30. What do I do? No one believes me. I tried going to the unemployment office. Do you know what they did? When I was in the hospital, that was over $3,000. They called up the insurance carried and told them to terminate me - my hospitalization. I have nothing. The only thing I have is what is in this house. Well, Kauffman comes up here from Atlanta, and he's a born-again Christian, so he comes together with a group up here somehow. You see, he's hiring born-again people... Jehovah Witnesses. Hartlett is a Jehovah. There were more Jehovah Witnesses than there was anybody. <HOWARD EISSLER> But Hartlett was somebody you brought in though, wasn't he? <STAN CATERBONE> Well, what happened was I put everything together. But would it not be right to say that Hartlett would be your person as opposed to Kauffman's person. Well, it is those two against me. They are the two that are trying to take the company from me. See, I controlled everything. Everyone went with what I said because I did things that were right for business and

right for people. I treated people fairly and honestly. People respected me more than anybody. <HOWARD EISSLER> Did Kauffman in the initial offering that you had, the preorganizational offering - each of you put up $20,000 - did Kauffman put up 20? <STAN CATERBONE> He got more stock; he never paid the other 10 for the remainder of the shares. He was supposed to put in 30 for his 50 - $.50 a share. The three of you put in 20. Then, he had a back agreement with me to sell me 10; so we both would have 50,000 shares. I got that contract and he never fulfilled that. I said no way are you getting more shares than me when I put it together. I said you can be equal with me. <HOWARD EISSLER> But how did that come about? <STAN CATERBONE> We signed a back agreement so Hartlett wouldn't get mad. I had to write to buy about 10,000 shares from Kauffman, 50, to give us both 50 at anytime at $.50 a share. <HOWARD EISSLER> You have that agreement? Yes, he never signed it after he got his 50. It was a bad move on your part. There is nothing wrong with the idea but do you think at that point he was conniving to do - <STAN CATERBONE> he was conniving from day one. When we put this thing together, I was in the middle constantly between Kauffman and Hartlett. In fact, at one time Kauffman was going over an idea - this was over a year ago before we moved into the office - about how he could set Hartlett up to get him out. Then, when he couldn't get Hartlett out then the two of them tried to get me out. <HOWARD EISSLER> Now, everything is in place and it is operational? But obviously you have a lot of contacts to make this thing go. <STAN CATERBONE> I'm out. I haven't talked to anybody? But you did have initially. <HOWARD EISSLER> You already made them and they now have the - <STAN CATERBONE> yea, I spent 5 years. <HOWARD EISSLER> But now they've picked up your contacts really, so to speak? <STAN CATERBONE> Exactly right. They are acting as mortgage bankers, etc. The whole bit - everything I put into place, they just stole away from me. See, I never communicated with people. I couldn't, only because I couldn't find competent legal counsel to tell me what to

do. All they did, was send me bills. I didn't even want to send a letter to everyone explaining the situation until I got a competent legal counsel to tell me what is right, what is wrong, and what to do. I went to 3 attorneys and they tell me there is no violation - and I'm in jail for 5 days for what they did to me 3 months previous. <ROBERT BEYER> Even according to FMG, Stan was with the company until July 1, <HOWARD EISSLER> is that right? _________________ <ROBERT BEYER> Here are 2 certificates, June 25th, signed by Bob Long, Secretary. <STAN CATERBONE> I was the Secretary, I was a Board Member. And, this is April 24th, 1987 Semi- Annual Report in which someone - forged my name. I never even saw that. They never even had an Annual Shareholder's Meeting; they never let people examine the books that have wanted to. <HOWARD EISSLER> Of course, all of this would boil down to their getting money from somewhere, extracting money. Either they are cheating somebody and putting it in their pockets or taking exorbitant salaries - is business that good that it could stand that? <STAN CATERBONE> We are paced to do $4,000,000 GCI (Gross Commission Income) a year, that's a lot of money passing through your hands. <HOWARD EISSLER> Now the people that are ____________, doesn't it affect those people? Are they skeptical of what's happening? <STAN CATERBONE> I have no idea. I know the clients that I have talked to, that came down from New Jersey to find out what really went on ran the other way as soon as they talked to me. In fact, one woman got so sick, she went downstairs and threw up when I told her. <HOWARD EISSLER> Well, you know the corporation, regardless of what the situation is when there is a problem like this with you, or anyone, the corporation has to continue to function? The fact that somebody has signed your signature to a financial management semi- annual report, I don't know if that is a security violation, in that end of it. If it would be corporate law, it may be, but not at the security end of it. <STAN CATERBONE> Well, someone changed my address. Who knows who gets my mail? I never changed it.

<HOWARD EISSLER> From where? <STAN CATERBONE> From 1755 Oregon Pike, FMG. It goes here; it goes down to New Jersey. I never did it; who did it. They go through all my mail - open all my mail, then send it to me in bunches 10 days later. <HOWARD EISSLER> This is the Financial Management Group that does this? Of course, it is coming to you as one of the principals in the corporation, and if it comes in from their standpoint, they wouldn't know if it had to do with corporate business or your business personally. The fact that they opened it may not be ethical, but I don't know that -. <STAN CATERBONE> If you change my address, that is forgery. You got to go to the Post Office and sign to change an address, don't you? <HOWARD EISSLER> Well, I don't know. If you are no longer associated with them - <STAN CATERBONE> who says, I am no longer associated with them. <HOWARD EISSLER> The Post Office doesn't know that. If somebody comes in and says you are no longer here, you're over there - I don't know that the Post Office - <STAN CATERBONE> somebody there should not have done it. These are things that show this is not fabricated or something; they are actually happening. I got so desperate I already wrote 60 Minutes. <HOWARD EISSLER> How much money are we talking? <STAN CATERBONE> Millions. <HOWARD EISSLER> That they have taken? <STAN CATERBONE> I was Executive Producer of the first digital movie ever, in the world. I was to get 40% of the profits. I could have made 100-200 million dollars. I was ready to do a deal with the owner of Turkey Hill. I was supposed to receive a check in July for $200,000; after he heard the rumor, he backed off. <HOWARD EISSLER> How much have they squandered? <STAN CATERBONE> How do I know? I can't get at their books. <HOWARD EISSLER> These stock certificates that you __________ Scott Robertson, for instance, bought

42,000 shares. Stock certificates wouldn't - _____________ In June of 1987, he bought 2,000 shares of stock. Now the signature that is forged on yours is the secretary. It should have been yours, but there is nothing wrong with the certificate as such - aside from the secretary signing the certificate? <STAN CATERBONE> There is something shady about that stock deal too. You see this is a year, not quite a year. <HOWARD EISSLER> Would this be part of the of 203 offering? <STAN CATERBONE> Yes, everything is. All stock is part of the 203D. <HOWARD EISSLER> What I am saying is, Scott Robinson bought the 2,000 at $5 a share or whatever; he put up $10,000 and he was entitled to get a certificate. If you weren't there to sign it - Telephone call - someone for Bob Kauffman If Scott Robinson put up the money and Peter Ponerose put up 8,000 shares, if he paid $5 a share - <STAN CATERBONE> they didn't pay $5; they paid $2.50. <HOWARD EISSLER> Regardless, they were entitled to the shares. If they can't get at you to sign the shares - <STAN CATERBONE> why couldn't they get me? I was in that office. <HOWARD EISSLER> Oh, you were still there in June. <STAN CATERBONE> Yes. Even according to them. <HOWARD EISSLER> When were you actually locked out? July 1. That's when I went in there and took my files, when I found out they were doing that. <STAN CATERBONE> Because they only way they could get the certificates was to break into my office, because I had them. <HOWARD EISSLER> You had the stock certificate book? <STAN CATERBONE> Yes, I did everything - they didn't even know how to do any of that stuff. That's how I caught them. I knew the law because I did it. I did the memorandum and everything. <HOWARD EISSLER> The thing that is wrong with these certificates basically is the fact that Long is signing

as secretary and at that point, on the 25th of June, you're the secretary. As far as we know, these things could have really been negotiated at the end of July and backdated. I am not trying to beat you down. <STAN CATERBONE> I got them July 1 - my attorney copied them for me. That's how I got those copies. <HOWARD EISSLER> What you are saying, prior to your being locked out of this place, they were already bypassing you. They found out that I was talking to an attorney. Now what would they be afraid of when you were talking to the attorneys. What they were doing. Of course, they do have control of the corporation - between Hartlett and - <STAN CATERBONE> I did, I controlled the Board. That is why they threw me out. When I made a decision, the Board followed it. But now, they are gaining control of the Board. I have no idea. I have never heard of a Board Meeting. <HOWARD EISSLER> Who is on the Board of Directors? <STAN CATERBONE> Me, Bob Kauffman, Mike Hartlett, Bob Long and Alan Loss.

<HOWARD EISSLER> I heard those names; I can't remember where. They were the signatures on the semi- annual report. Is Long a born-again Christian. <STAN CATERBONE> No, he is the accountant who hired from Main Herdman. <STAN CATERBONE> Were you a party to hiring all of these. Everybody. Pete Peneros was terminated by Shearson and I was the only person in time to give him a job. He already had some trouble with the NASD. He was suspended; it took about 5 months just to get him relicensed - they had charges against him, allegations - forgery - in fact what he did in June was he went and used another persons rep number at FSC to do options trading and that person supposedly reported him, or wanted to report him - Dick Sherbach. <HOWARD EISSLER> Is he from Lancaster? - <STAN CATERBONE> Greek. <HOWARD EISSLER> But he is from Lancaster? <STAN CATERBONE> Yes, but he was working in Harrisburg at Shearson. They fired him in November. <HOWARD EISSLER> I saw his name but I can't connect it. So many names came up as a result of this -

I'm sort of swimming trying to get everybody straight. It's not easy, believe me. Time is one thing that I have a lot of - <STAN CATERBONE> so do I. I can't do anything else, what can I do? <HOWARD EISSLER> Did you ever hear of a _____ or _______ organization? Some years ago, there was some outfit - New Environmental Technology - Remember when that was floating around. They had a big shindig down at the Strasburg Inn. A lot of people from New York came in. The whole thing fell through although Environmental Technologies are is a local corporation in business and they were trying to merge with ___________ Shell Corporation out of New York. <STAN CATERBONE> I am not familiar with it. <HOWARD EISSLER> Again, it was a lot of born-again people that would meet; they would push on the idea that all things stock up. Well, I know he is running advertisements on the radio that deals with the religious sect. Now, that they are set up, does the Financial Management Group need money or do they have enough money to operate. <STAN CATERBONE> No, they've got money. <HOWARD EISSLER> They are a self-sustaining operation then; anything they get from selling securities they will pick up the commission, if there is brokered mortgages they will pick up the commission on the mortgages, and that's enough to keep them going, right? <STAN CATERBONE> Oh, yea. <HOWARD EISSLER> They are not pressed for money? <STAN CATERBONE> No. <HOWARD EISSLER> Have the handled the customers/investor's money correctly. <STAN CATERBONE> No. <HOWARD EISSLER> You have mentioned they've given money to Tom Turner and Kauffman's wife, what else have they mishandled? <STAN CATERBONE> I know the Federal people wanted to investigate Kauffman's books, of his stock book that he was managing. <HOWARD EISSLER> This is when he was down at

Atlanta? <STAN CATERBONE> No, this is now. That's why they wanted him to liquidate his mutual funds so he could manage it for him. <HOWARD EISSLER> They wanted you to liquidate your mutual funds? <BILL JOHNSON> I told him that I was a little unhappy with the performance of the mutual funds that I had; he wanted me to liquidate it and go into the stock market and let him work it for me. <HOWARD EISSLER> He was going to act as your financial planner? <BILL JOHNSON> I would imagine, yea, broker, buy and sell stock. <HOWARD EISSLER> Have they acted as financial planners? - Now there license has not been approved yet. Is the one that you - <STAN CATERBONE> there is over $100,000 of our RIA fees that they have collected last year - illegally. <HOWARD EISSLER> Did you say RIA? Registered Investment Advisor. <STAN CATERBONE> Do you want to see it? <HOWARD EISSLER> Yea, let me. Who is registered now? <STAN CATERBONE> No one is registered. I was that close to getting it registered when I got shut it. It was all ready set to go; I got the papers. I think it was just some questions. <HOWARD EISSLER> Were you working with Jamaneau? <STAN CATERBONE> Yea, he is the corporate attorney that I got - and I think he is very _______. He is good. <HOWARD EISSLER> There's no problem with him. <STAN CATERBONE> No, Jeff's a good guy. He taught me securities law. <HOWARD EISSLER> I am trying to think, this application here? Paul Short is who I was working with. I asked to see the file quickly on Friday - I didn't know it was there. <STAN CATERBONE> Now I am still President of FMG

Advisory. <HOWARD EISSLER> O.K., now wait a minute - let me see, FMG Advisory comes in yet. <STAN CATERBONE> They threw me out of the Financial Management Group; they never mentioned FMG Advisory which I was President of. <HOWARD EISSLER> Is this the one that applied to - oh, alright, you're using the initials FMG, that's Financial Management Group? <STAN CATERBONE> Right. I set up an umbrella so it would be consistent. <HOWARD EISSLER> What threw me off was, when Financial Management Group was registered there was a whole lot of other entities involved which used the initial FMG Advisory Service, Accounting Service. <STAN CATERBONE> That was for continuity. <HOWARD EISSLER> O.K., then FMG Advisory Service was never really, up to now, was never really registered as an investment advisor, right? <STAN CATERBONE> Correct. They were registered _______ but not with the state? Right _______. <HOWARD EISSLER> But, now, during this time - from the time they are in business, from August of 1986 until now, they have done investment advisory services and these are the fees that they collected? <STAN CATERBONE> I charged some. <HOWARD EISSLER> You are allowed to charge up to, what is it - 14 people? <STAN CATERBONE> I think it is only 5. I was careful about that one. I know I only charged 5 clients, I am sure of it. The SEC really gave me a rough time getting that thing filed - I couldn't even understand their questions half of the time. They are a mess, they really are. I must have spent 100 hours. <HOWARD EISSLER> I agree with you, there is a lot of attorneys work in the Harrisburg, and the question is the application - the question is about that long and the answer is Not Applicable. <STAN CATERBONE> Yea, it takes you 3 hours to figure out that you don't answer it. <HOWARD EISSLER> I agree with you. I have a tendency to want to throw it away.

<STAN CATERBONE> Well, after 5 months of fooling with it myself, I called Jeff up and said, Jeff, you got to help me get through this thing. I got to get this registered. I called Jeff on the RIA probably in January - no, probably February or March. <HOWARD EISSLER> So, June 1987 was the last correspondence you had. <STAN CATERBONE> Yea, right there it is. Right there, it was done on June 23. <HOWARD EISSLER> I am going to want a copy of this. <STAN CATERBONE> I need to get a copier in here and copy it for you. I can't leave these out of here without copying them. These files are just to valuable to me - if they get lost or whatever. You can attach it to whatever you want, but I want to get a copier in here and make copies for you and you can just run. I don't know where I am going to get money for a copier but --. Well, these files have been literally all over the country. In fact, most of these files are in 2 law firms in California and New Jersey. I was all over the place. <HOWARD EISSLER> This is the application for your registration as an investment advisor. <STAN CATERBONE> I would like to see what the new one says on it. <HOWARD EISSLER> As you can see, they are all like a standard form. Like I said, I have difficulty looking at these things. If I am looking at something I can find it, but just to look over and say its alright or whatever. <STAN CATERBONE> But I would like to see who they have listed on as officers. <HOWARD EISSLER> I just looked at it Friday and didn't take particular notice other than I knew that Kauffman and Hartlett were some of the people. <STAN CATERBONE> My name wasn't on it. <HOWARD EISSLER> Oh, no, no, your name wasn't on it. <STAN CATERBONE> Well if they are using FMG Advisory, I am still President of that company. <HOWARD EISSLER> Well, I don't know in corporate law what it takes to do away with a President at the Board of Directors meeting.

<STAN CATERBONE> I'll tell you what it takes. ----- that's exactly right, but they didn't have a Board of Directors Meeting. No, the shareholders must vote on the Board. Shareholders must vote and approve, and shareholders must exempt people on the Board.

Shareholders have to vote to remove someone from the Board. Yes, but the Board of Director would be elected for a year to two years, whatever the situation would be. So that corporate officer would be there for that entire period. The three of us were elected to the board for a period of 3-5 years. The initial Board members -this was one of Kauffman's move to gain control over a one-year term. Me, Kauffman, and Hartlett were 3-5 year terms. <HOWARD EISSLER> When did that take place? <STAN CATERBONE> We did that back in June of 86 when we started the company. <HOWARD EISSLER> Your only connection with the company now is the fact that? <STAN CATERBONE> I have no connection. They will not let me - and I have personal belongings in that office, and they owe me money. <HOWARD EISSLER> That is something that you two are going to iron out. See, my involvement is criminal charges - that's how I am involved. And my involvement is going to be the mishandling of investor's money. Well, all of these other financial management groups are 100% stock holders - FMG Advisory Inc - 100% stockholders? <STAN CATERBONE> Yea, what it is, the shareholders own Financial Management Limited; Financial Management Limited owns all the other subs. <HOWARD EISSLER> O.K., 100% - there is no other involvement? <STAN CATERBONE> That's right. <HOWARD EISSLER> Financial Management Group's Semi Annual Report - I think there would be some financial information - <STAN CATERBONE> that's right, they won't give it to anybody - not even me. <HOWARD EISSLER> You had mentioned that there are offices throughout the country. How are those people connected here? <STAN CATERBONE> Shareholders and they are

aligned with us through the broker/dealer. They go through us to the broker/dealer, rather than direct. We own 5% of Planner's Security Group in Atlanta. We get the same deal that we 're supposed to with Hibbard & Brown with this outfit in Atlanta. They are a fairly large broker/dealer. They are doing about 15-20 million dollars a year right now, Gross Commission Income (GCI). <HOWARD EISSLER> Is it Hibbard? <STAN CATERBONE> No, they are the born-against that I left, I moved away from. <HOWARD EISSLER> What's the name of the Atlanta Group? <STAN CATERBONE> Planners Security Group - Bill Kegler. <HOWARD EISSLER> There's nothing wrong with that group? <STAN CATERBONE> Yea, they terminated me for no reason. <HOWARD EISSLER> As a registered rep? <STAN CATERBONE> Yep. I am sure they will come up with a reason; there is a reason why they did it because with the NSAD they had to file. I would like to know why? <HOWARD EISSLER> You know, you were terminated because you were sick or, you know there is going to be a reason. Whether it is true or not. <STAN CATERBONE> Lying has become an accepted norm for all of this. <HOWARD EISSLER> Well, in their compliance department, all of these broker/dealers should and generally do keep very good close track of their sales people. <STAN CATERBONE> How can they when I did the deal? <HOWARD EISSLER> But Financial Management Group owns 5% of Planners Security? <STAN CATERBONE> Bill Kegler was with FSC and got angry when he couldn't run FSC 3 years ago. Then he started his own broker/dealer. <HOWARD EISSLER> This is with Planners Security?

<STAN CATERBONE> That's right. He left John Keeble because of a power struggle with them. <HOWARD EISSLER> But now, other than terminating you when they shouldn't have, they are not doing anything bad? <STAN CATERBONE> How do I know? <HOWARD EISSLER> Do you suspect they are? <STAN CATERBONE> Yea, they terminated me, you bet. You better believe I suspect. If they are doing that to me, what are they doing to the poor clients who don't know anything. The same thing with FMG - if they are doing all this to me, what are they doing to the clients that don't know anything. My clients are pissed. <HOWARD EISSLER> So, what they could do is withdraw their money from the organization whether its in the form of stock or whatever, but there is nobody making investments ____________. Your money is invested through ____________? <STAN CATERBONE> I've got the former Medical Director of St. Joseph Hospital that owns 10,000 shares with FMG that is very upset about all of this. He is away; I couldn't get him last night to come to the meeting. They got $35,000 of his. He went through everything from that company - <HOWARD EISSLER> but he still owns the stock? What did they offer you $2 a share or something? <STAN CATERBONE> They didn't offer me anything. <HOWARD EISSLER> But in that letter they did. <STAN CATERBONE> They offered me when it came time for me to get the check because they knew what I was going to do. <HOWARD EISSLER> Well, you wouldn't have taken the $2 a share would you, because you were talking about a 5-1 split. I would have taken it but I would have pursued my civil and legal rights and sued them for the rest. I went 5 days without food - I was starving. I had no money - 5 days without food - people look at me and laugh. Did you ever go 5 days without food? when you are worth a considerable amount of money? <BILL JOHNSON> Kauffman told me that he was going to offer Stan $1-1.25 a share to settle it out, to buy his stock and out of the proceeds of that he was going to pay me the money that is owed to me first, right off the top, I was his first consideration - that he wouldn't buy the stock unless my note was satisfied.

<HOWARD EISSLER> You have a note with First Financial Group claiming they are liable for it. <STAN CATERBONE> So you took the money and put it into ? No, I don't know who has the money. A bank either has it or Lancaster Aviation. It was embezzled from me, I don't know who has it. <HOWARD EISSLER> But they are acknowledging that they have custody of it? They were acknowledging liability for it. <STAN CATERBONE> We don't know who has it. Either Commonwealth Bank has it or Lancaster Aviation, I don't know. <HOWARD EISSLER> But you put it in the bank? <STAN CATERBONE> No, I didn't put it anywhere. <HOWARD EISSLER> He gave you the money, what did you do with it? <STAN CATERBONE> I gave it to Lancaster Aviation for the airplane. Then they repossessed the airplane before my first payment for, I don't know why. And I don't know where the $25,000 down payment is. He don't have it and I don't have it. <HOWARD EISSLER> But the $25,000 went to him, not as an officer of the corporation? <STAN CATERBONE> To me personally. <HOWARD EISSLER> The airplane is not part of this corporate complex? <STAN CATERBONE> No. <HOWARD EISSLER> But now Financial Management Group is saying they will pay you back that $25,000? <STAN CATERBONE> Uh, huh. They sent letters to all my creditors. <BILL JOHNSON> They told me that on 3 different occasions - before they suggested I go to the bonding company. Then they gave me a letter saying basically that if I wanted to talk about it, talk to their attorney. <STAN CATERBONE> Well, did you tell him about the bonding company? <BILL JOHNSON> Yea. They wanted you to sort of make the allegation that I gave Stan the money to invest for me and that he had scuffled the money - they wanted

me to tell the bonding company that, which I refused to do. <STAN CATERBONE> They took out the bond after July 1. I got a thing in the mail about a bond; I thought what is going on. Then he told me about a week later - I said that's what that is - a $4,000,000 bond. <HOWARD EISSLER> You know the bonding company? <STAN CATERBONE> Fidelity. <HOWARD EISSLER> Of course, I am thinking from their standpoint - Financial Management Group has not seen the $25,000. <STAN CATERBONE> No, I don't know, maybe they have it. They might have it. <HOWARD EISSLER> Well, the only way they could get it is if it were a reimbursement made on the airplane. <STAN CATERBONE> They were the ones calling the bank and the Aviation Company about the plane, asking what I was doing with it, where I was going? They were the ones that initiated all the conspiracy with the lending institutions. My credit rating was excellent up until August - "01" down the line, never owed anybody anything. <HOWARD EISSLER> This is going to drag out; I will keep in touch with you. Now, you also have investments through mutual funds through Financial Management Group? And how much money are we talking about roughly? <BILL JOHNSON> About 170,000. <HOWARD EISSLER> Now, do you have the certificates for this. <BILL JOHNSON> No, they were never issued. They are held in ________ with the broker, <HOWARD EISSLER> and the broker in this case was? <STAN CATERBONE> His probably weren't transferred yet, it was probably FSC. <HOWARD EISSLER> So, it would still be a monthly statement from them - so there is no problem with it disappearing. <BILL JOHNSON> I don't get anything from FSC, I get it from Keystone - FSC is noted as the broker/dealer, I am sure. I doubt that they went yet to Planners Security.

I get the interest off that money, I get a check every month. <HOWARD EISSLER> But your investment is not in jeopardy now, as far as you know.? <STAN CATERBONE> No, but he is on disability and 25 grand meant a lot to him. <HOWARD EISSLER> Now, Kauffman wants you to sell these the mutual funds and give him the $100,000 to invest as a broker? <BILL JOHNSON> Right. <HOWARD EISSLER> Of course, you are reluctant to do that because you still have confidence in Stan. <BILL JOHNSON> I have confidence with Stan and I am not very comfortable dealing in the stock market just now. I like more settled investments - the stock market idea and I don't get along very well. I am looking for safety of my investments. Like Stan said, I am on disability and I do need income. <HOWARD EISSLER> And Kauffman promised you a fortune if you made this transaction? <BILL JOHNSON> He didn't come right out and promise me a fortune but he insinuated that I could do a lot if I let him work the stock market.. He was doing all options, that's all he does. Well, I don't want no damn parts of options. <STAN CATERBONE> You look at his client files; they are all option accounts. All of them, little old ladies down to --. <HOWARD EISSLER> Here again, which you know, the broker when he is talking to you, or the registered rep when he is talking to you, should file a form as to what you want. Now you just mentioned to me that you are a conservative of man. I had him in government securities. - And they should have these on file.

Now, if you are conservative and you give him the money and he starts dealing in options, he is really violating the trust that the government and the NASD is trying to establish between the client. <BILL JOHNSON> I tell you what. I feel sorry for you guys. You guys got a hell of a nightmare. Stan always backed me up; there were times I pulled my investments out and put them in CDs for a while because I was just not comfortable with what was happening. <STAN CATERBONE> And, I tell him what CDs to buy

at local banks. <BILL JOHNSON> I have the utmost confidence in Stan. Mr. Kauffman tried extremely hard to shake that confidence. <STAN CATERBONE> He tried to shake up my own family. He had my own family believing. Do you want to know something. In August, I was on my way to Hollywood to the film studio and to see some legal clients I was working with one day - that night I come back to my house to get a night's rest. I get thrown in jail.

I go to the police station to get a restraining order against my family that didn't understand what was going on - I get retained in the police station for two hours, get taken to a hospital. That day, someone called the Stone Harbor police and said I had a gun and was running to the beach to kill myself. This thing is ugly. <BILL JOHNSON> As a matter of fact, I would believe I am the only one left to believe Stan is still sane. Well, I caught on real quick. I don't believe he had anyone to talk to except me. <STAN CATERBONE> I didn't. I could talk to him every other day since April; someone had to believe what was going on. I have tapes - I have a tape of Bob Kauffman July 3 telling a, supposedly client of mine - it was actually my brother - that I was mentally ill, spending money that I shouldn't been, and wasn't taking care of my clients. <BILL JOHNSON> He told me the same thing. - that Stan had wasted away somewhere between $45,000 and $70,000 of his own money, just throwing it away on frivolous things. <STAN CATERBONE> Every minute I have ever spent and every dollar I have ever spent, I've made money on anything. I got my brothers in pro football - held my own free agent camp. And, they were both picked up last week, as a matter of fact. I was involved in that too. Right there. <HOWARD EISSLER> I thought I heard - is he connected with the Eagles? <STAN CATERBONE> Eagles and Dolphins. <HOWARD EISSLER> I just heard it on the news - one of those things - I heard the name mentioned, it is not that common a name, and I heard the name mentioned in the newscast of the NFL strike and it was like - what was that, but it was too late. That Thursday, right after I called you, was when I got the call. <BILL JOHNSON> Stan held his own free agent camp

so that the players who didn't get chances in the bigger camps had an opportunity to do it. <STAN CATERBONE> 50 people showed up, from all over the country. The most innovative camp - I taped the camp, sent the tape to all 3 leagues - 55 teams. <HOWARD EISSLER> When was that, 84? <STAN CATERBONE> Yes, right there it is. <HOWARD EISSLER> And some of them got picked up as a result of this? <STAN CATERBONE> Only one, my brother. I guess they had to have some body. Yea, that was a fun day that day. That camp cost me 5 grand and generated so far $200,000.00 in salaries for my brother. That airplane that I bought would have made me $3,000 net profit a month, leasing it out. I had at least 20 hours of leasing every month for 350 a month at $7,000, and my payment was $1500.00. <HOWARD EISSLER> You were leasing it to? <STAN CATERBONE> My contacts, my network. <HOWARD EISSLER> With you as a pilot, you mean? <STAN CATERBONE> No. It's a big plane. I hired my own pilot. When I'm doing business all over the country I can't fly commercially. In three weeks, my charter bill was 4 grand for using another person's plane 5 times. <HOWARD EISSLER> Then, you bought this, and before the first payment was due they grabbed it back. Can they do that? <STAN CATERBONE> No they can't. Why do you think I've got a large lawsuit against 3 banks. One of the reasons they said they did it was because it wasn't properly insured, but he had insurance. The other reason they said, he took it to Florida. Now I don't know why you would buy $100,000 airplane and leave it at the airport. Do you know why I was taking it to Florida? I bought a place on an island, another very good investment. Now they are suing me because I couldn't settle because I got blackmailed 2 months later. They said I was going to Florida to run away and hide. I was going to Florida to settle my property. They had to come up with a reason so that's the reason that was around I guess. But, Pete Peneros's brother works for Commonwealth National Bank. Plus, do you know anything about United ChemCon? They are being investigated right now by the FBI and Attorney General.

<ROBERT BEYER> Chemcon is the big local minority- held corporation that was doing a lot of defense contracts - it was associated with ISC. They went under last Spring, beginning of the summer, and there was a lot of criminal allegations made, none of them substantiated. <STAN CATERBONE> And I was connected with that. They sent a Board Member in to see me a week before this happened. Why, I don't know. <HOWARD EISSLER> Is this Lancaster based. <STAN CATERBONE> Yes, Jim Christian owned it - now I hear rumors that I was tied to ISC and I am close to several people in that organization. Why they sent someone to California to see me, I don't know. They won't answer me.

<HOWARD EISSLER> Who is this, the FBI?

<STAN CATERBONE> No, this is Chemcon. I said if you ever come back or you have someone else call me, I want a $10,000 retainer fee. Never heard from them since. Then, two weeks ago, Jim Christian called me while I was in the hospital. That guy hated my guts for five years. Why, he called me, I don't know. <HOWARD EISSLER> What did he want? <STAN CATERBONE> I don't know. <HOWARD EISSLER> You didn't speak to him to find out? <STAN CATERBONE> I spoke to him, he said nothing. The same thing the Board Member said when he came from California. Asked if I could go get ChemCon another building; asked if I would be interested in saving the company from bankruptcy - I was working with a guy from Belgium, they wanted me to talk to, a guy from DC and New York, a guy from the Caribbean. I don't know what the hell is going on.

Then I find out the Commonwealth Bank went and nailed ChemCon. Commonwealth Meridian said Christian personally signed for the $18,000,000 that was invested or lost of the governments money for these contracts. I don't know. I am sick of asking questions and people lying to me. <HOWARD EISSLER> You don't have any connection with that, other than you knew some people? <STAN CATERBONE> No, I've got their files, I got their financial statement, everything - they wanted me to do something.

<HOWARD EISSLER> But you're not connected with the company? You're not an investor? <STAN CATERBONE> No, I sold my ISC stock June 8. <ROBERT BEYER> A lot of people were saying that ChemCon, which is a minority - Christian is a black guy - was getting all the minority government contracts because he was one of the leading minority defense contractors around, and actually the supposition was - I don't know how true it would be - is that it was a front for ISC. <STAN CATERBONE> It was, I'll tell you why. Because when ChemCon was started, back to their inception, you look at ISC's book. They didn't have any money. Well, the first thing ChemCon did, was they went and got all that free money from the government and you look and see where that money went. I bet you I know where it went. This guy named Geurin, James Geurin. And I know that they were selling contracts back. He runs ISC and he also has his fingers pretty deeply in ChemCon. He's the one who started ChemCon, Geurin is the one who started it. <HOWARD EISSLER> Wasn't there some allegations about a tie with Wedtack. <STAN CATERBONE> You bet. They were tied, you'd better believe they were tied with Wedtack. The same guys in Wedtack were involved with ISC and ChemCon.

<HOWARD EISSLER> ISC is that an over the ______ exchange_. ISC is a London Exchange. International Signal and Control?

<STAN CATERBONE> I owned a thousand shares. I sold it when things started to hit the FAN. Now they just did a multibillion dollar merger with a company in London. They probably think it is going to cover their tracks. <HOWARD EISSLER> You mean United ChemCon is a local corporation. <ROBERT BEYER> Yes, they went bankrupt as of this last 3 months. What was it, $18,000,000 in liabilities? <STAN CATERBONE> What they did was, they fronted all that money and started the contracts, went bankrupt, now the government is stuck for $18,000.00. <ROBERT BEYER> They weren't paying employees, they weren't producing the product, they weren't paying their unemployment and everything else.

<HOWARD EISSLER> Did they pay the withholding taxes? <ROBERT BEYER> No. It turns out that Christian, who I have had a few dealings with, had an office that would be would be suiting of any AT&T executive - Amazing. Had these racquetball things in his office. 4 or 5 cars, thousands - <STAN CATERBONE> let me tell you about Jim Christian now. I know right now in this town's viewpoint, I stole money, I am insane, and I am a lunatic. I tell you I will not condemn Jim Christian until he tells me to my face what happened. I was framed and set up and I know <HOWARD EISSLER> (I see what you mean, your experience).

<STAN CATERBONE> I don't know, maybe Jim Christian doesn't have the money. Maybe Geurin has it or somebody else. $18,000,000 is a lot of money and he is broke because he lives with one of my best friends, ________. I mean they don't have money. And, I would think that if he took it, he would have something. <BILL JOHNSON> You're pretty nice, Stan, to somebody who has hated your guts for 5 years. <STAN CATERBONE> I know what I am going through, and who knows, maybe he was innocent too. Is this Christian you are talking about. Yes. <HOWARD EISSLER> You were going to make copies of these. <STAN CATERBONE> I can't make copies, I can fax them to you. I will make copies for you, in fact, what I should do is get everything copied for you. <HOWARD EISSLER> Well, no, because that is a tremendous expense. I would rather, if you have the time, or can stick me in the corner somewhere, maybe say, this and this, and this, I am sure we can eliminate half of it. <STAN CATERBONE> O.K. but you should tell me what you want and I will make copies. I just don't want this stuff to leave my hands anymore. I can let them to you overnight. <HOWARD EISSLER> Well, there is nothing we can do overnight. I can't elevate your problem as far as being out of the corporation - <STAN CATERBONE> oh, I thought you were going to

give me a check before you leave. <HOWARD EISSLER> So, anything that I would be involved in is going to be long and drawn out; it is not going to be an answer to your immediate problem. <STAN CATERBONE> I know, but I had to get someone involved. I had to get authorities to start taking action for me. ______________ the SEC - <HOWARD EISSLER>well, he is the one I am talking about mostly. <BILL JOHNSON> They said they were sending 2 guys up here last week for 2 days. <HOWARD EISSLER> Did you talk to them about what was going on? How did you happen to talk the SEC. <BILL JOHNSON> I was just trying to get my money back. They promised me my money and they didn't come up with it. So, I called them. <HOWARD EISSLER> So basically, you have _________. If they came there, I think their attitude would be well, ------ <BILL JOHNSON> no, they were curious as to some of the other things that were going on. I talked to them a couple of times. They were curious for one thing, Kauffman wanting to take my investment and putting it in the stock market and working it for me, they were curious about that. They were curious about the allegations of Stan's alleged insanity and forcing him out of the corporation, and I think they were a little confused about why they would accept liability for the money if it wasn't there liability. That would be a question that I would ask. I think that aroused their curiosity, but he also said that they have never been checked, and they are about due, so we might just as well go up there and dig into it and find out what was going on. <HOWARD EISSLER> As far as I know, that is what they did, what they call a compliance examination. I don't know that they were there looking -. Since your allegations were made, I am sure they looked into some items like that, but I think basically it was just a compliance examination. <STAN CATERBONE> What did they find? <HOWARD EISSLER> I don't know. <STAN CATERBONE> They were there though? <HOWARD EISSLER> There was two people supposed to be up there.

<STAN CATERBONE> Were they there last week? <HOWARD EISSLER> Well, it was recent, the report isn't even written, but the report I think will be more on the lines that they don't have a client complaint form filed - compliant type examination. Proper procedures, etc. <ROBERT BEYER> I am still interested as to how you were alerted to it. <HOWARD EISSLER> I have yet to get it - I was coming down as an appointment last Tuesday or Wednesday, which ever day, it was the next day I called you. I had an appointment here in Lancaster. I had gotten a call about 4:30 in the afternoon from the Phila office, and my supervisor down there said there is a newspaper clipping of your break-in of the Financial Management Group. I don't know whether to make an investigation out of it or not. It seems there are some securities involved. <ROBERT BEYER> The only 2 articles that appeared are right over there and none of them say anything about it. <STAN CATERBONE> They just know my name, right? They just knew that I was involved with the company? - it doesn't say anything about securities there. <HOWARD EISSLER> Nothing at all? Then how it came to our office I don't know, unless somebody sent it. <STAN CATERBONE> Even if they sent the articles, there is nothing in there to indicate who - they just called me an ex-worker. That is the interesting thing about it. "burglary, theft, unlawful restraint, robbery, unlawful use of computer, criminal mischief, and terroristic threats." <HOWARD EISSLER> I've never seen the article. <ROBERT BEYER> There it is, pull them down. <HOWARD EISSLER> No, that's alright. They were supposed to send it up to me and they didn't. <STAN CATERBONE> I'm leasing that building and accused of burglarizing my own building. <HOWARD EISSLER> See, he called me and said, you are going down to Lancaster. See if we should start an investigation. Stop up to the -- ex employee. Christian, I think was the arresting officer? Mathias, they said Lancaster Detective Mathias. <ROBERT BEYER> He's not, he's Manheim Twp.,

<HOWARD EISSLER> fortunately I found that out. <STAN CATERBONE> I called Township 2 months ago and they didn't help me. Then they throw me in jail when my partners call. <HOWARD EISSLER> So anyhow, I stopped up that evening, Tuesday or Wednesday night, the next day I called you but did not get you until Thursday or Friday, so that is my association. They were supposed to send up the newspaper clipping or whatever it was they had. But the only thing I know is that your name was associated in our office computer file with Financial Management Group. <STAN CATERBONE> Your not telling me anything new. <HOWARD EISSLER> But you see I was supposed to have this. Why I don't, I don't know because they were supposed to send it up. But the state in their own way to save a .40 postcard, they have a messenger service to Harrisburg. So, its alright if you get it in the mail, like if I was in the office this morning and put it in the mail before 10:00 it goes to the central office and gets distributed -then the next day it goes down and would be there the next day. But if you miss that 10:00 mail, it don't leave our office until the next day then the next day in the central file, then somebody drives it down to Philadelphia. <STAN CATERBONE> I should buy you guys some stamps. <HOWARD EISSLER> I had to deal with the State that long so you know these are just little quirks that keep popping up every now and then. <ROBERT BEYER> I'll tell you an interesting part that I had when I went out to view -they had to __________- and Manheim Twp. called in to Hartlett as I was there. I was there to get property returned to Stan, and Hartlett started going through things and paying a lot of attention to what was there, and had already admitted wasn't his. There was a lot of correspondence there, he was very interested in, and the policeman even came to my aid and made him not be nosey, even its yours or it isn't, and he released everything to me. <STAN CATERBONE> Do you know what I took out of the office was on the books, everything that I wanted to see. <HOWARD EISSLER> Did they let you keep that? <ROBERT BEYER> No, no, in fact the inventory from

the service warrant, just about everything on here is Stan's files, even labeled as such. Then I found a ______ checking account, K & H Enterprises, Kauffman- Hartlett Enterprises, they returned that to Kauffman. <STAN CATERBONE> K & H, what do you think that stands for? Kauffman and Hartlett. <HOWARD EISSLER> Well, that's what the initials stand for but what type of business? <STAN CATERBONE> I never heard of it. <HOWARD EISSLER> You don't know what it would be? <STAN CATERBONE> I can imagine what it would be. A brokers business somehow? It's something fishy. I can't remember the bank, I think it was Hamilton Bank., Probably Hamilton or Farmers First. <HOWARD EISSLER> In looking at these, the only thing I can say, as far as I know Philadelphia is the only information they had. Now maybe it came in anonymously. I know a lot of people in Philadelphia. This involves Financial Management Group or something or involves securities, because the guy I talked to said, you know, should we be involved in it at all? Ask what it is, see if there is securities involved? And that's what I did and that's when I came up Mathias and of course he mentioned ____________-. <STAN CATERBONE> Well, who mentioned to you about medicine. <ROBERT BEYER> It wasn't Mathias; Seigler was involved. <STAN CATERBONE> Why, how did they get wind of that? <ROBERT BEYER> Hartlett and I were there and Hartlett was talking about you taking your medicine. <STAN CATERBONE> What medicine? ___________, that's a bunch of crap. <ROBERT BEYER> That's what Hartlett was telling him. And Hartlett was saying is he taking care of himself and all of this stuff. <STAN CATERBONE> That son of a bitch. He is really painting a nice picture. <ROBERT BEYER> Well, the cops didn't really buy it because they asked Hartlett to leave and they gave me the information that they told Hartlett they weren't going

to give me. Yea, well they mentioned the things that you had taken, a couple of items, that they had given back and allowed you to have them. They gave all the files back to FMG before we were involved and then he gave me the personal correspondences, but they kept his camera. Apparently, Stan was doing the policeman's work when he was in there the night he was accused of burglarizing the place. He took pictures of all his files in their office and they said they had better keep that. <STAN CATERBONE> This is June 30th. It is my files in their office. That's the night I left. <HOWARD EISSLER> Who's taking the pictures? <STAN CATERBONE> A friend of mine. <HOWARD EISSLER> You were with someone? This was 3 o'clock in the morning. Oh, you weren't arrested on the premises, were you? <STAN CATERBONE> No, but this is when I was in the office. This is when they stole my files out of my locked doors. <ROBERT BEYER> He was arrested September 3rd I believe it was - <STAN CATERBONE> this is June 30th. <ROBERT BEYER> They don't know he was in there then, I guess. <HOWARD EISSLER> These aren't the films that you are talking about? <STAN CATERBONE> No, the films he is talking about I took of my files again in their office, and attorneys say they didn't do anything wrong - explain why I was in jail for 5 days. This is the stock certificate book here, <HOWARD EISSLER> this big black book? <STAN CATERBONE> Yea. <HOWARD EISSLER> You are still connected with the company here? <STAN CATERBONE> This is June 30th. The funny thing is, even the second one is not breaking in - well, the girl left me in and she's a friend of mine. <ROBERT BEYER> He is still President and at the time

he was still Secretary I guess. I don't think the police feel too awfully strong that they have a burglary type charge. <HOWARD EISSLER> I know. <STAN CATERBONE> Well, I tell you what, they abused me the night they arrested me._________ Well, the cop that picked me up here left me ride on the front seat and everything. When I get to Township, handcuffed me, put my hands to the belt, threw me in a cell, bounced me around the car. They wouldn't even listen to who I was. I had all the documents that told them that I was lease holder of the building - wouldn't even look at it. They didn't ask me anything. I know why they are acting nice now. They are going to hear from my attorney. I don't know who even made the complaint, whether it was the girl who made the complaint. <HOWARD EISSLER> You were arrested the next day? <STAN CATERBONE> No, that night. I told 5 people that I wanted to arrested that night. I had to. <HOWARD EISSLER> But then somebody had to call the Manheim police. Do you know what they did? <STAN CATERBONE> They called up the police that day and said 3 days previous to that, that I made a bomb threat to that building - that's what the police picked me up for. <HOWARD EISSLER> Oh, really? _____________ <STAN CATERBONE> That's what the police picked me up for. Then, while I was there they charged me with the burglary. They initially picked me up for a terroristic bomb threat, that took FMG three days to report, they couldn't even remember when the phone call was, and the person that reported it, I don't even know who she is - never saw her, never heard of her. <HOWARD EISSLER> You were at the premises there roughly what time? <STAN CATERBONE> I went there about 10:30 Thursday night; <HOWARD EISSLER> you were there an hour? <STAN CATERBONE> Not even that, about a half hour. I left and dropped off at _________, had a drink, and got a girl to take the car I had, I borrowed somebody's car because my cars were in New Jersey - I flew back, and got this girl to drive me here and as soon as I pulled in Conestoga police were right behind me. I said, great,

they're here. And when the Conestoga Twp. cop, I said, let me take all these files with me so I can show you guys who I am and what I was doing. Well, they just took everything and threw me in the cell and that was it - arrested. <HOWARD EISSLER> Well, let me get started. I didn't read these letters yet. <STAN CATERBONE> Read that one letter right there. That's right we have that other thing now. <ROBERT BEYER> Yea, he's being sued civilly for this office furniture here which was purchased from FMG. But FMG then tells the Office Supply Store that he has not connection with us. <STAN CATERBONE> When they have my suite of furniture in that building. <HOWARD EISSLER> Oh, that what the pictures, is that your personal furniture? <STAN CATERBONE> You bet. I purchased this in June to go down to Stone Harbor; see the movie that I was working on, FMG was to get 15% of the profit for my endeavors down there. This was purchased as an agent of Financial Management Group. (Bob Byers left meeting) <STAN CATERBONE> On the back of that letter you were just reading is the name of the person he was communicating to. My name was the only one on all the checking accounts, authorized to disburse money. Hartlett was on a couple with Kauffman_, but I was on all of them - the only one. Kauffman was on some; Hartlett was on some - we were common, but I was on all of them. <HOWARD EISSLER> Do those checks take 2 signatures? <STAN CATERBONE> No, one. <HOWARD EISSLER> What accounts would you have been on alone. <STAN CATERBONE> All FMG Advisory - I took care of all that. <HOWARD EISSLER> They use the term "gunjumping" like a broker/deal wants to come into Pennsylvania - before he could sell he - you can to sell to 5 people, - before you get into the problem area. Now, when you

are selling to one or two people, you should apply for a registration with PA. Now, say a broker/dealer sells 5, people, 10 people, 15 -then all of a sudden, he says, hey, maybe I'd better register. Now he goes to register with PA and they say, how many people did you sell to, and of course he has an extra 10 people - that's called "gunjumping." So, again, how serious is the crime? Sometimes they'll say, o.k., because you gunjumped, we are going to register you but you going to have a 5-day suspension, that way it is on the record that he did gunjump. The same situation is going to happen here. They were not registered investment advisors and, obviously from the paper they were giving investment advisory work and soliciting from you so they have really done a violation there. Of course, with you, you had applied for the investment advisory registration - it didn't go through. They closed the thing by abandonment, like all the questions weren't answered. Now they are applying again, so they are in the process of registration. I could throw a question at you, is there any reason now why they should not be registered as investment advisors? <STAN CATERBONE> Here, again, if they are abusing me what are they doing to the clients? <HOWARD EISSLER> Granted, and that is the end I am going to work on. Can you give me any specific information - they've done you dirty. <STAN CATERBONE> They've done me as well as others. <HOWARD EISSLER> Who else have they done? <STAN CATERBONE> Do you want names? <HOWARD EISSLER> Yes. <STAN CATERBONE> Bill Umiker. <HOWARD EISSLER> In what respect would this be? He is a shareholder. And, what have they done to him? <STAN CATERBONE> They don't let him shoot books - they shut him out? <HOWARD EISSLER> How about you, I hate to drink your coffee. You are operating on a shoestring, here. Well, how are you now? Can you survive? <STAN CATERBONE> No, I can't survive. <HOWARD EISSLER> What are you going to do, are you here by yourself?

<STAN CATERBONE> That's a good question; I've been working on this for 3 months. I sell a piece of furniture. <HOWARD EISSLER> You don't have an investment portfolio of your own that you can fall back on? <STAN CATERBONE> Yea, FMG. Is that the only one you have? I have no cash. That is a good question, what do I do? Why have I paid taxes for the last 28 years? <HOWARD EISSLER> Then you had a substantial income once? <STAN CATERBONE> I never made a lot of money. I never wanted cash because they I had to invest it. I took equity. <HOWARD EISSLER> So, it's not paying off now? <STAN CATERBONE> I bought this house for $90 - it was appraised at $180 after a year. But everything I have put my - everything fell apart because of what these guys did, everything at one time just fell. Like I say, I was coming into a half million dollars in cash this summer on a project. You know these projects take time, and time, and time. <HOWARD EISSLER> You had mentioned a movie down in Stone Harbor, what was this? <STAN CATERBONE> The first digital movie ever in the history of the world. <HOWARD EISSLER> Digital movie, meaning not on film? <STAN CATERBONE> No, it's on film but all the sound is digital. Kodak and Mitschubichi won't have this technology for 5 years. I was working with the leading recording studio in the world. I was named Executive Vice President of a major film studio in Hollywood 60 days ago, but I can't do anything. <HOWARD EISSLER> Was this film being made in Stone Harbor? <STAN CATERBONE> Yea, that's why I was down. But, it never got off the ground because of what happened to me. <HOWARD EISSLER> You mentioned this Bill Umiker, are there any others? He is one of the investors as a result of __________ deal, <STAN CATERBONE> right? The film studio in

Hollywood needed my help to raise funds. They had some lenders and some investment companies commit some allegations. They want me to come in and help clean it up and get things resolved. They're hurting. My family's hurt. My family is deeply hurt. My mother's a nervous wreck. My name is mud everywhere and I was a very visible person - a giving person. My life is ruined. <HOWARD EISSLER> You are contemplating, I am sure, taking action against them for spreading this - <STAN CATERBONE> I have been contemplating on that for 90 days - no one believes me. All the attorneys do is want to suck me up with fees and do nothing. The first attorney I went to on June 30th told me to quit fabricating these allegations and spend my time and energy on other useful things. Was that Joe Roda? My cousin. Then sent me a bill for $500, and two weeks prior to that he told me a check was in the mail for a client I sent to him. Never got the check but I got two bills so far for $500. Now how can your attorney say that you are lying? This is your cousin yet, don't forget that. <HOWARD EISSLER> You're right. <STAN CATERBONE> I talked to Gib Armstrong, the Senator, back in July. He told me he was going to have the attorney general call me - never. That's why I went to 60 Minutes. 60 Minutes has everything. I told 60 Minutes what happened; I told them who I went to - everybody, the attorney general, the FBI, the SEC, the NASD. Diane Sawyer, I wrote her a personal note a week and a half before I got arrested, out of desperation. I was desperate. To me, my life was threatened. It still is threatened and no one gives a damn, but Bill. <HOWARD EISSLER> Has anything happened to you; you say your life is threatened? <STAN CATERBONE> My house was broken into in Stone Harbor. My phone was tapped, I know it was tapped. <HOWARD EISSLER> Do you think it would be Kauffman. <STAN CATERBONE> Who knows, I am involved in so many things all over the place, who knows. Put it this way, I know Kauffman and Hartlett were the _________ but I was a big threat to the banks around here. I beat them on a $15,000,000 deal here in Lancaster prior to them repossessing my plane. I was a big threat to all the banks. They couldn't compete with me. <HOWARD EISSLER> They didn't lose $15,000,000? <STAN CATERBONE> They were going to lose a

$15,000,000 mortgage because of me. <HOWARD EISSLER> You mean, you placed the mortgage with someone else? <STAN CATERBONE> It never got placed. It happened all at the same time. <HOWARD EISSLER> But on the idea of doing that, you as an investment banker or whatever, you could get- -? <STAN CATERBONE> A half a point. <HOWARD EISSLER> Then the people ultimately did have to get the mortgage place somewhere. <STAN CATERBONE> They never got it placed yet. They are still trying to get it placed with my mortgage banking operation through FMG people that are stealing that from me. <HOWARD EISSLER> So, they have taken your sales commission type away from you? - <STAN CATERBONE> where's my salary? <HOWARD EISSLER> Were you a salaried person - until July 1? <STAN CATERBONE> You bet. And I was granted a 90-day leave of absence with pay. I told them that I was going to just to clean up my other deals but I was really taking time off to seek an attorney and pursue. <HOWARD EISSLER> This is prior to July 1? <STAN CATERBONE> Yes, I was scared because I knew how liable I was as an officer of that corporation. When I found the stuff that was going on, I was scared. I didn't want to be tied up in all --------------END IM=159P02.CPR DI= PAGE 2 IM=159P03.CPR DI= PAGE 3 IM=159P04.CPR DI= PAGE 4 IM=159P05.CPR DI= PAGE 5 IM=159P06.CPR DI= PAGE 6 IM=159P07.CPR DI= PAGE 7 IM=159P08.CPR DI= PAGE 9 IM=159P10.CPR DI= PAGE 10

IM=159P11.CPR DI= PAGE 11 IM=159P12.CPR DI= PAGE 12 IM=159P13.CPR DI= PAGE 13 IM=159P14.CPR DI= PAGE 14 IM=159P15.CPR DI= PAGE 15 IM=159P16.CPR DI= PAGE 16 IM=159P17.CPR DI= PAGE 17 IM=159P18.CPR DI= PAGE 18 IM=159P19.CPR DI= PAGE 19 IM=159P20.CPR DI= PAGE 20 IM=159P21.CPR DI= PAGE 21 IM=159P22.CPR DI= PAGE 22 IM=159P23.CPR DI= PAGE 23 IM=159P24.CPR DI= PAGE 24 IM=159P25.CPR DI= PAGE 25 IM=159P26.CPR DI= PAGE 26 IM=159P27.CPR DI= PAGE 27 DI= ************************************************************* TI=\RUSSELL, GRUBER & HUBER TRESPASS NOTICE TO S. CATERBONE IM=160P01.CPR DA= October 2, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 3 SU= SUMMARY: A trespass notice from Financial Management Group, Ltd., to Stan Caterbone noticing that Stan Caterbone is not licensed nor privledged to enter or remain on the premisses at Financial Management Group, Ltd., 1755 Oregon Pike, Eden Park II, Manheim Township, Lancaster, Pennsylvania, which premisses are the sole and exclusive property of Financial Management Group, Ltd.,. signed by attorney Christine Housner for Craig Russell. IM=160P02.CPR DI= PAGE 02 IM=160P03.CPR DI= PAGE 03 DI= ************************************************************ TI=\ATTY. MCDONALD CONFERENCE

IM=161P01.CPR DA= October 4, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 2 SU= SUMMARY: A copy of actual notes taken by Mike McDonald during a meeting with Stan Caterbone, at 2323 New Danville Pike, Conestoga PA, at the request of Stan Caterbone. Stan Caterbone became suspicious of the lack of aggressive legal actions taken by attorney Robert Byers concerning the legal issue of Stan Caterbone's lease agreement, Unsubstantiated and paperless termination, interests in companies headquarter at 1755 Oregon Pike, that was the solely owned by Stan Caterbone, as well as others. Mike McDonald was of no help either. IM=161P02.CPR DI= PAGE 02 DI= ************************************************************* TI=\ARRAIGNMENT FOR MANHEIM TOWNSHIP CRIMINAL CHARGES IM=162P01.CPR DA= October 5, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: Waiver of Arraignment for the criminal charges of theft, criminal mischief; and unlawful use of computers. The trial was scheduled for the January, 1988 term. was scheduled to begin 14 days from November 25, 1987. Attorney Robert Beyer had filed the document. DI= ***************************************************************

TI=\MANHEIM TOWNSHIP vs. S. CATERBONE PRELIMINARY HEARING DA= October 2, 1987 AT= CORRESPONDING AUDIO TRACKS: 02/03/04/05/06/07/08/09

SU= {AUTHENTIC TRANSCRIPT OF PRELIMINARY HEARING AS TAKEN BY CHARLES A. LONG, RPR, OFFICIAL COURT REPORTER} 1 IN THE COURT OF COMMON PLEAS OF 2 LANCASTER COUNTY, PENNSYLVANIA 3 CRIMINAL 4 COMMONWEALTH 0F PENNSYLVANIA : 5 VS. 6 STANLEY J. CATERBONE 7 8 PRELIMINARY HEARING 9 DATE: October 2, 1987 10 1.00 p.m. 11 MURRAY HORTON, District Justice 12 TAKEN BY: Charles A. Long RPR 13 Official court Reporter 14 LOCATION: District 02-1-02 2205 Oregon Pike 15 Lancaster,Pennsylvania 16 APPEARANCES 17

ROBERT D. BEYER, ESQ. 18 110 East King Street Lancaster, Pennsylvania 17602 19 On Behalf of the Defendant PAGE 1 1 INDEX TO WITNESSES 2 WITNESS DIRECT CROSS REDIRECT RECROSS 3 STACY LYNN WATERS 6 20 30 3l 4 ROBERT E. KAUFFMAN 34 41 50 l 5 DANIEL ANTHONY BERGER 54 57 51 6 LARRY G. MATHIAS 58 60 7 JUNE KEMPER 66 68 70 7l 8 LARRY C. SIEGLER 71 72 9 PAGE 3 1 P R 0 C E E D I N G S 2 MR. BEYER: Good afternoon, Your honor. 3 THE DISTRICT JUSTICE: Good afternoon. We 4 have two Criminal Complaints charging the Defendant 5 Stanley J. Caterbone, here at the moment. 6 The charges were read at this time. 7 DETECTIVE MATHIAS: I understand Detective 8 Siegler, he is enroute. 9 THE DISTRICT JUSTICE: we can't proceed on 10 that until he is here, but we certainly can proceed on 11 the other. Do you have a copy of both charges? 12 MR. BEYER: Yes. I want to bring something to 13 both your attention in case I misheard it. When you 14 were referring to the first Complaint I think you said 15 it was your number 202. I don't have a number on the 16 first Complaint but my second complaint says 202. I 17 want it so we are straight. 18 THE DISTRICT JUSTICE: They all have the same 19 number. 20 MR. BEYER: Okay. 21 THE DISTRICT JUSTICE: All right. Do you have 22 a copy of the one filed by Detective Mathias? 23 MR. BEYER: Yes. And I waive that reading, 24 Your Honor. 25 THE DISTRICT JUSTICE: All right. Who is our PAGE 4 1 first witness? 2 DETECTIVE MATHIAS: First, Your Honor, we 3 would like to dismiss the robbery charge. In consulting 4 with the District Attorney's Office, I was directed that 5 that would be the proper thing to do in this case. 6 THE DISTRICT JUSTICE: In other words, you're 7 going to withdraw the robbery? 8 DETECTIVE MATHIAS: Correct. 9 THE District JUSTICE: And not pursue that. 10 Cross it off, everyone on their Complaint. And who is 11 the District Attorney who authorized that? 12 DETECTIVE MATHIAS: District Attorney Totaro.

13 THE DISTRICT JUSTICE: T-0-T-A-R-0? 14 DETEcTIVE MATHIAS: First name is Donald. 15 THE DISTRICT JUSTICE: The others stand, do l6 they? 17 DETECTIVE MATHIAS: Yes. 18 THE DISTRICT JUSTICE: Now, we will have the 19 first witness. 20 DETECTIVE MATHIAS: At the request of the 21 defense, we are going to sequester the witnesses. 22 MR. BEYER: That's correct, Your honor. 23 THE DISTRICT JUSTICE: All right. 24 25 STACY LYNN WATERS, called as a witness, PAGE 5 1 being duly sworn or affirmed, was examined and testified 2 as follows. 3 Q THE DISTRICT JUSTICE: Last name? 4 A Waters. 5 THE DISTRICT JUSTICE: Stacy Lynn Waters. Go 6 ahead. 7 DIRECT EXAMINATION 8 BY DETECTIVE MATHIAS: 9 Q Miss Waters, would you lease tell us what 10 you do for a living, where do you work? 11 A I work for my mother at cleaning at FMG and 12 other buildings. 13 FMG. Do you know the location of that? 14 A 755 Oregon Pike. 15 Where do you live at? l6 A In Lititz' 204 Queens ate Road. 17 Could you explain what occurred on the 18 evening of the 4th of September, 1987 while you were 19 working at FMG? It may have been the 3rd, 4th of 20 September. In that area there. 21 A Okay. I was working at FMG. I heard a knock 22 on the window I looked to see who it was and it was Stan 23 and I went to the door to say hello and when I opened 24 the door, he walked in. Then I realized that he wasn't 25 really supposed to be in, so I told him that he PAGE 6 1 couldn,t 2 Q It was Stan Caterbone? 3 A Stan Caterbone. 4 Q Is Stan Caterbone known to you? 5 A yes. 6 Q Is that person in the courtroom now? 7 A Yes. 8 Q Would you point to that person? 9 A Pointing. 10 Q That would be the person seated next to 11 counsel? 12 A Yes. 13 Q Okay. How long have you known Mr. Caterbone? 14 A About a year-and-a-half.

15 Q So it was clearly him? T 16 question in your mind it was Mr. Caterbone that you were 17 talking to that night? 18 A No. 19 Q What night was it; do you know? 20 A A Thursday night. 21 Q Thursday. Did you -- did something happen 22 that evening after that, after you left Stan into the 23 building? 24 A Yes. He told me that he had come to take 25 some files that were his and take some pictures and so PAGE 7 1 He went into Mike Hartlett's -- 2 Q Mike Hartlett? 3 A His office. 4 Q As a result of what happened that night with 5 Mr. Caterbone, were the police called? As an end result 6 of that happened, whatever you're going to tell us right 7 now, were the police notified? 8 A Yes. 9 Q Okay. Did you provide the police with a 10 statement? 11 A Yes. 12 THE DISTRICT JUSTIcE: can you say when were 13 the police notified? Like a year later Or that very 14 night? Or do you know when? 15 A I didn't notify the police 16 BY DETECTIVE MATHIAS: 17 Q They were notified within an hour or two of 18 what you are talking about now? 19 A Yes. 20 DETECTIVE MATHIAS: Okay. The reason I'm 21 asking, Your Honor, is she provided a statement and I 22 think it is a very complicated case and I would like to 23 introduce her statement so she has it with her. 24 THE DISTRICT JUSTICE: The police were 25 notified almost immediately then, is what you are PAGE 8 1 saying? 2 DETECTIVE MATHIAS: The police were notified 3 within a reasonable time frame of the crime. 4 THE DISTRICT JUSTICE: Now she stopped that 5 Stan went into Mike's office. 6 DETECTIVE MATHIAS: Right. She supplied us 7 with a statement. I have it here. I'd like to have it 8 there. That's what I'm trying to get at. 9 THE DISTRIcT JUSTICE: Show it to him. Do you 10 have a copy? 11 MR. BEYER: I don't have a copy. I think the 12 proper way would be for her to be able to refresh her 13 recollection with this statement, but I don't believe 14 she could sit there and read from it. 15 DETECTIVE MATHIAS: She already has reviewed 16 it. I think she would like to have it with her in case 17 there is something about dates or times, et cetera. It

18 is a seven page statement. 19 THE DISTRICT JUSTICE: Go ahead. Stan went 20 into Mike's office. 21 DETECTIVE MATHIAS: May I give this to here 22 THE DISTRICT JUSTICE: Yes. 23 DETECTIVE MATHIAS: Would you like to see 24 this, Your honor? 25 THE DISTRICT JUSTICE: No. Go ahead. live it PAGE 9 1 to the witness. 2 DETECTIVE MATHIAS: 0kay. 3 BY DETECTIVE MATHIAS 4 Is this the statement that you given to 5 the police and to me, as a matter of fact, on the date 6 of this incident? 7 A Yes. 8 Q I want you to have that so you have it there 9 with you for your reference if you need it. Now would 10 you continue. What happened that evening, if you can 11 explain? 12 A 0kay. Then he had a screwdriver. He pried 13 open Mr. Hartlett's desk. 14 Q When Stan came to the building you said you 15 left Stan Caterbone into the building? 16 A Yes. 17 Q And then you said he went into someone else's 18 office? Or some office? 19 A Yes. 20 Q How did he get into that office? 21 A It was open. 22 Q Okay. At any time did he go into any offices 23 that weren't open that he had no right to be in? 24 A None that were not open. 25 Q Did he go into any offices that were locked? PAGE 10 1 A No. 2 Q At any time did he go in? 3 A To the basement, but that was the only one 4 that had to be unlocked. The hallway that we were in 5 was locked. 6 Q I see. How did he get into the hallway? 7 A I had the keys and he got them out of your 8 hands and unlocked it. 9 Q He took the keys from you* 10 A Yes. 11 Q You didn't give them to him? 12 A No. 13 Q If he would have asked you for the keys, 14 would you have given in? 15 MR. BEYER: I object. That's speculative. 16 DETECTIVE MATHIAS: Okay. 17 THE DISTRICT JUSTICE: Somebody is going to 18 ask the question. Did he forcibly take them from you 19 A Yes. 20 THE DISTRICT JUSTICE: Go ahead.

21 BY DETECTIVE MATHIAS: 22 Q After he took the keys from you? 23 A Yes. 24 Q What happened? 25 A Then we went -- well, we walked around and he PAGE 11 1 showed me some things that he had in a bag, papers. 2 Q What were they that he showed you? 3 A That he had in a bag with him. 4 Q That he had with him? 5 A Yes. We went into an office, he showed me 6 these things. They were papers of charges that he had 7 against Financial Management Group and I don't remember 8 the other things. And then we went to Mr. Hartlett's 9 room -- office. 10 Q Explain if you can -- what we want you to 11 understand, see, some if the people here don't have any 12 idea what happened that evening at all and we are trying 13 to explain the story to them so they understand that 14 happened. 15 A Okay . 16 Q Okay . Now he went into Mr. Hartlett's 17 office? 18 A Yes. 19 Q That happened there? 20 A Then he took out a screwdriver and he pried 21 open the desk and started taking files out. 22 Q He did? 23 A Yes. 24 Q Did he remove an thin from those desks? 25 A The files. PAGE 12 1 Q What happened to those files? What did he do 2 with those files? 3 A He carried them with him as we went to 4 another office and then we took the files out to the car. 5 car. 6 Q Okay. You're saying he took the files to his 6 vehicle, 7 his car? 8 A Yes. 9 THE DISTRIcT JUSTICE: He or We? 10 A He. I was with him but, I mean, he carried 11 the stuff. I was with him the whole time. 12 THE DISTRICT JUSTICE: You went out to his 13 car? 14 A Yes. He had me -- he had my arm. 15 BY DETECTIVE MATHIAS: 16 Q What do you mean? He forced you to go with him? 17 him. 18 MR. BEYER: I object to the form of the 19 question. 20 THE DISTRICT JUSTICE: Well, just tell the 21 young lady to tell us exactly what happened.

22 DETECTIVE MATHIAS: Yes. 23 BY DETECTIVE MATHIAS: 24 Q You said you went to the car with him? 25 A Yes. PAGE 13 1 Q Why did you go to the car with him? 2 A Because we didn't o to the car right 3 Mr. Hartlett's office. First we went to Mr. Kauffman's 4 office. He took pictures of some files and took 5 more files. We went into the computer room. He took a 6 disk. And when I went to use the phone then he took 7 my arm 'cause he didn't want me to call anyone. Then he 8 had me with him the rest of the time and then I 9 accompanied -- was with him when he went out to the car. 10 Q You said you went to call someone 11 A Yes. The police. 12 Q Why were you going to call the police? 13 A Because, I mean, I was told that he was not 14 to be in there. And he was taking files. 15 Q What happened then? 16 A Then he came out and he took me by the arm 17 and took me back to the office with him. 18 Q He took you back? If you would have 19 wanted to leave, could you leave? 20 MR. BEYER: I object to that it's speculative too. 21 THE DISTRICT JUSTICE: Rephrase it. 22 BY DETECTIVE MATHIAS: 23 Q Why didn't you leave? 24 A Why didn't I leave? Because he had my 25 arm. PAGE 14 1 Q And he wouldn't allow you to leave? Is that 2 what you are saying? 3 A No. he didn't want me to go call anyone 4 Q So, you didn't call the police? 5 A No I didn't. 6 Q What happened then? 7 A Then, well we had to make two trips out to 8 the car to take files out and then he wanted to go down 9 to the basement and so we went down there and I didn't 10 know I even had a key that unlocked it, but he unlocked 11 it. Then he ripped out some phone lines. We went back 12 upstairs and we went into the computer room and he l3 ripped -- 14 THE DISTRICT JUSTICE: Did she say cut? 15 A No. He ripped them out, just ripped them 16 out. 17 THE DISTRICT JUSTICE: You said ripped 18 phone lines? 19 A Yes. And we went up to the computer 20 room and he turned the key on the computer. I don't 21 know if it turns it off or what it does. I don't know. 22 And he tore some other things out of the wall there. 22 then we went to another office. He ripped some -- tore 24 some lines out from an ADP machine and then --

25 Q what is an ADP machine? Do you know? PAGE 15 1 A It is what stock brokers use for their 2 quotes. I don't know what all it does. 3 THE DISTRICT JUSTICE: Did she say again 4 what he did to that? 5 A He tore some of the cords out from it. 6 THE DISTRICT JUSTICE: Electrical cords? 7 A Yes. 8 THE DISTRICT JUSTICE: Okay. 9 BY DETECTIVE MATHIAS: 10 Q While this was going on, while this occurred 11 with Stan Caterbone being in the office areas, were you 12 scared? 13 A I was scared to a point twice. The first 14 time was in Mr. Kauffman's office and he had my arm and 15 I was just kind of fighting to get away and trying to 16 get him to stop and just to leave. And he just -- he 17 said that I was putting up pretty much of a fight. He 18 threatened to knock me out. 19 And then the second time was when we went down 20 to the basement and I was scared because it was dark 21 but he said that if he was going to do anything to me he 22 would have done it by then. 23 Q If you would have wanted to leave? 24 A Yes. 25 Q While Mr. Caterbone was going into these

PAGE 16 1 offices, could you have left? 2 A No. 3 Q Why? 4 A Because he had a Hold of my arm. Not always 5 tight, but when I did try to get away, then he did grab 6 it tighter. It didn't hurt me or anything. 7 Q So, he held you? Is that what you are 8 saying ? 9 A Yes. 10 Q At what point did you finally get free? 11 A when he -- when he was leaving out at his 12 car. 13 Q Can you explain? 14 A He had my keys and -- and so he had to give 15 them back but he made me go out with him and then he 16 gave me my keys back and then he made sure got back 17 in the office okay and he left. 18 Q Is there anything you would like to say about 19 what has happened here that I haven't asked you that you 20 just want to make a comment about this whole story, 21 this whole incident? 22 A No. 23 DETECTIVE MATHIAS: One moment. I have 24 two questions. 25 BY DETECTIVE MATHIAS: PAGE 17

1 Q One, you said that you saw him tearing things 2 out of the phone downstairs? 3 A Yes. 4 Q You saw this with your own eyes? 5 A Yes. 6 Q Okay. And who did that property belong to; 7 do you know? 8 A I don't know. I guess it belongs to whoever 9 owns the building. 10 Q Okay. You said he had taken a disk out of a 11 computer upstairs. 12 A from a file, yes. 13 Q Actually removed it from the computer? 14 A No. It was in the file. 15 Q What happened to that disk; do you know? 16 A H took it with him. I don't know what 17 happened. 18 Q To the car? 19 A Yes. 20 Q And you said he removed items from disks 21 in the offices, one of those desks he had actually 22 opened with a screwdriver. He took things and he took 23 them with him as well? 24 A Yes. 25 Q In his car? PAGE 18 1 A Yes. 2 Q And left. When he left you to come back in 3 and watched that you safely returned to the building, he 4 actually left with those items? 5 A Yes. 6 DETECTIVE MATHIAS: I have no more questions. 7 THE DISTRICT JUSTICE: Before you go ahead, 8 clarify something for me. The Defendant didn't have you 9 by the hand all the time from the moment you let him in 10 the door -- 11 A No. 12 THE DISTRICT JUSTICE: -- until he finally 13 released you outside to go back into the office and 14 assisted out or whatever? Is there a reason why you 15 didn't walk out the door? Or call the police? Or do 16 something? 17 A Because until that I was just trying to get 18 him -- I wanted him to just leave and I was Just trying 19 to talk him out of taking things. 20 THE DISTRICT JUSTICE: Go ahead. 21 DETECTIVE MATHIAS: You do bring up the poinT. 22 THE DISTRICT JUSTICE: I wanted clarification 23 here. Did he have her by the hand all the time? 24 BY DETECTIVE MATHlAS: 25 Q After Stan grabbed your arm or held your arm, PAGE 19

1 from that point on? 2 A Yes. 3 Q Did he ever let you go that you could have 4 left until the very end, when he gave your keys back? 5 A He didn't -- oh, he had like his arm around 6 my arm but when I, you know, tried to get away then he 7 held tighter. So, I mean, I did try a couple of times. 8 Q So could you have gotten free if you would 9 have wanted to? 10 A No. 11 DETECTIVE MATHIAS: 0kay. 12 MR. BEYER: My turn? 13 DETECTIVE MATHIAS: Yes. 14 CROSS-EXAMINATION 15 BY MR. BEYER: 16 Q Good afternoon. You've known Stan for 17 about a year-and-a-half, I think? 18 A Yes. 19 Q How did you first meet Stan? 20 A I met him first when I was doing some work 21 for my dad when he was with IDS. 22 Q Then you knew that Stan was the executive 23 vice president of Financial Management Group? 24 A Not at that time, I don't think so. That was 25 a little before, but, yes. PAGE 20 1 q At one time you worked for FMG, didn't you? 2 A Yes. 3 Q What position did you have at FMG? 4 A I was a receptionist. 5 Q When did you start working there? 6 A July of last year. 7 Q Of '87? 8 A Yes. 9 Q And who hired you ? 10 A Mike Hartlett. 11 Q Did you work with Stan there? 12 A I worked for Stan. I did some things for 13 him. 14 Q And you and Stan were pretty good friends, 15 I believe ? 16 A He talked once in a while. 17 Q And you went down to the shore to visit him 18 at his house? 19 A No I didn't go down 20 him. I saw him there once. 21 Q All right. when did you terminate your 22 employment with Financial Management Group? 23 A I think July this year, '87. 24 Q And why did you terminate that employment? 25 A Because my mom had a cleaning business and

PAGE 21 1 she needed help and I was going to work for her. 2 Q There was a point when you were told Mr. 3 Caterbone wasn't allowed in that building - is that

4 accurate? 5 A yes. 6 Q Who told you that? 7 A Mike Hartlett. 8 Q Did you know when he was officially removed 9 as an executive or anything like that? Or you were Just 10 following Hartlett's orders? 11 A Yes. He told us that he was removed as 12 executive. 13 Q Hartlett told you that? 14 A Yes. 15 Q All right. Now when Stan knocked on l6 window that evening I think your initial reaction was 17 you were glad to see him? is that a fair statement? 18 A Yes. 19 Q And you had never had any trouble with Stan 20 before that? 21 A No. 22 Q And when he first came in the door did he 23 have something with him? 24 A I don't remember. I guess he had the blue 25 bag. ** PAGE 22 1 Q Okay. He was carrying that with him in his 2 hand? 3 A Yes. 4 Q Would it be safe to say that Stan was rather 5 excited that night? 6 A Yes. 7 Q And he wanted to show you a lot of things in 8 the building? 9 A Yes. 10 Q And he was taking you around from office into 11 office saying, look at these files in this office, look 12 at these files in that office? 13 A Yes. 14 Q And, in fact, he told you look, that Kauffman 15 is now in my office and here are all his files. He l6 showed you that, didn't he? 17 A Yes. 18 Q And, you had also been aware that Kauffman 19 had all the locks changed on his office, didn't you? 20 A I had thought that Stan had the locks 21 changed. The outside of the doors, yes, the locks were 22 changed. 23 Q But, you're aware that before Stan took his 24 business operations to New Jersey that he had the locks 25 changed on his own office? PAGE 23 1 A yes. 2 Q But then Kauffman had them rehanged, I 3 guess right? 4 A Not that I know of. 5 Q Okay. Did you guys go in that office?

6 A Yes. 7 A Had it been locked? 8 A No. 9 Q So, if that door was unlocked it was unlocked 10 before you got there that evening? 11 A I unlocked it when I got there. 12 Q And where did you get your set of keys? l3 A I have them for cleaning for Mr. -- I think 14 it is Mike. Stan gave me a key to his door. 15 Q Stan gave you a key to his office? l6 A Yes. 17 Q All right. Now, as he is going from office to 18 office picking up files, what was he doing with them? 19 A Taking them. 20 Q Where was he putting them? 21 A He held them in his hands and then Just 22 Mike's, just Mr. Hartlett's files. 23 Q Was he carrying them. 24 A He was carrying them. 25 Q Now, he was carrying those and also carrying PAGE 24 1 his Blue bag. 2 A I don't remember if he had sat it 3 somewhere or if he had it with him. 4 Q Okay. can you estimate how much he had taken 5 from Mr. Hartlett's office in terms of size? 6 A About like that much. 7 Q And that's what he was carrying with him? 8 A Yes. 9 Q Now, how long do you think Stan was in the 10 building that day? 11 A It was not quite an hour. Almost an hour. 12 Q You were aware that Stan and the partners in 13 the business were having a problem between them 14 you? 15 A Yes. l6 Q And you were aware that Stan felt as though 17 the company had taken many things that belonged to him 18 A I didn't know what the situation was. I thought 19 that it had calmed down and that it was pretty 20 much over by that time. 21 Q But you're aware that Stan felt that most of 22 the stuff in there was his? 23 A I didn't know what -- I mean nobody talks 24 about it. I didn't know what was going on. 25 Q He was saying it that night? PAGE 25 1 A That night, yes, he felt that things were 2 his. 3 Q And your desire was to try to talk him out of 4 taking anything because you didn't thing it was really 5 right? * 6 A I didn't know and I didn't -- yes.

7 Q Where else did he get files? 8 A From Bob Kauffman's office. 9 Q And that's Stan's old office? 10 A Yes. 11 Q The one he had the locks changed on? One 12 Stan had the locks changed on? l3 A Right 14 Q How much did he take from Kauffman's office? 15 A He took, oh, I don't know how much. He took l6 a wastepaper basket and had it filled. He made two 17 trips. 18 Q Okay. How did he carry the wastepaper basket 19 to his car? 20 A How? 21 Q Yes. 22 A Around his arm. 23 Q What about his blue bag? 24 A I don't remember where that was, if he had it 25 with him or if he got it when he came back in. PAGE 26 1 Q Okay. You indicated there were two points 2 when you were kind of scared. 3 A Yes. 4 Q The one was going do*n to the basement and 5 it was dark, right? 6 A Right. 7 Q Had you ever been down in the basement. 8 before? 9 A No. 10 Q And when was the other one? 11 A When we were in Bob's office and I was trying 12 to get him to quit and to leave and I was trying to get 13 my arm from him and he Just said that I was putting up 14 a fight and that he would knock me out and I didn't now 15 if he was serious. 16 Q From your experience with Stan, you were 17 pretty sure he wasn't serious, he wasn't going to knock 18 you out, weren't you? 19 A I didn't know because of the things I had 20 been told about Stan. People had said, you know, that 21 I didn't know what to expect. 22 Q But, I guess your initial answer was you 23 weren't sure if he was serious or not? 24 A I wasn't sure. 25 Q All right. when you made the first trip to

PAGE 27 1 the car, what did he take with him? 2 A The first trip? He took files. 3 Q Was the trash can involved in that first 4 trip? 5 A I don,t remember. 6 Q Okay. If he took files, was he carrying them 7 in one hand?

8 A Yes. 9 Q What about his blue bag? 10 A I don't remember what happened to the blue 11 bag. I really don't. I don't know if he had sat it 12 down, picked it up on the way out or what. l3 Q And you went out to his car with him? 14 A Yes. 15 Q Did he put the stuff in the car? l6 A Yes. 17 Q And where were you when he was putting the 18 stuff in the car? Just standing there watching him do 19 it? 20 A When he was putting it in the car, I was 21 standing there. 22 Q Okay. 23 A He had -- I was with him when he went out. 24 Q He wasn't still holding you out at the car 25 was he? PAGE 28 1 A No, not out at the car he was not. 2 Q You could have ran there if you wanted to, 3 but at that point you weren't really afraid of him? 4 A I guess I could have. 5 Q And, then you went back in with him for the 6 second trip? 7 A Yes. 8 Q And the second trip he took everything else 9 that he hadn't taken on the first trip I take it? 10 A Yes. 11 Q And then he gave your keys back? 12 A Yes. 13 Q And he waited to make sure you could get 14 back into the buildings safely because it was dark outside? 15 A Yes. 16 Q And, in fact, I think the two of you might 17 have kissed goodbye? Or a peck on the cheek? See you 18 later? Take care? 19 A There was a peck on the cheek. 20 Q Okay. 21 MR. BEYER: Thank you, Stacy. 22 DETECTIVE MATHIAS: Recross this for a second. 23 MR. BEYER: Redirect. 24 DETECTIVE MATHIAS: Called redirect? 25 MR. BEYER: Yes.

PAGE 29 1 DETECTIVE MATHIAS: Thanks. 2 REDIRECT EXAMINATION 3 BY DETECTIVE MATHIAS: 4 Q You commented on the first trip to the car 5 you could have ran, you said I guess. The question was 6 asked of you, could you have run. You said I guess? 7 A I suppose I could have at that time. I mean 8 he had more things to get and I stayed with him to see 9 what he was doing. 10 Q Why didn't you run?

11 A I didn't have my keys for one thing and I 12 wasn't going to leave him with my keys. 13 DETECTIVE MATHIAS: May I get a question 14 in here that's off the record for the sake of the case? 15 THE DISTRICT JUSTICE- Only with no objection. 16 DETECTIVE MATHIAS: For your sake. 17 MR. BEYER: I think it is for my sake. 18 DETECTIVE MATHIAS: It is for your sake. 19 There was a brief discussion 20 held off the record at this time. 21 MR. BEYER: This is on the record. 22 THE DISTRICT JUSTICE: On the record. 23 DETECTIVE MATHIAS: On the record. 24 BY DETECTIVE MATHIAS: 25 Q Right now, the objective of the questioning PAGE 30 1 taking place is to determine whether or not you were in 2 fear of being harmed by Stan Caterbone and whether or 3 not you were being unlawfully restrained by him, meaning 4 you could not leave of your own free will. Do you 5 understand? 6 A Yes. 7 Q The question I have is, could you have one 8 and today, as you sit here, do you feel and believe that 9 you could have left and do you feel that -- or do you 10 feel that you were being unlawfully restrained by Stan 11 Caterbone? 12 A While we were in the building I didn't think 13 I could have left. I don't think I could have left. 14 When I was out at the car, by that time it was all over 15 and my main concern was that he didn't leave with the 16 keys. 17 RECROSS-EXAMINATION 18 BY MR. BEYER: 19 Q were you in fear for your life? 20 A For my life? 21 Q Yes. 22 A No. 23 MR. BEYER: Okay. No more questions. 24 THE DISTRICT JUSTICE: If at the car at the 25 first trip when he was using both of his hands to put PAGE 31 1 stuff into his vehicle, if you did flee -- how much do 2 you weigh? 3 A Ninety pounds. 4 THE DISTRICT JUSTICE: So he is bigger 5 lot bigger, a lot faster, could easily overtake you? 6 A Yes. 7 THE DISTRICT JUSTICE: Did that thought 8 to you at all? 9 A Yes. 10 THE DISTRICT JUSTICE: It did? 11 A Yes. I mean, I knew he was bigger than I was 12 and I wasn't going to -- 13 THE DISTRICT JUSTICE: The thought did

occur 14 to you that if you did try to flee, if he wanted to stop 15 you it would be rather easy? 16 A Yes, if he wanted to stop me, yes. 17 THE DISTRICT JUSTICE: Is that one 18 things that prevented you from fleeing there? Or is it 19 Just the keys? 20 A Well, yes, he could easily have -- 21 THE DISTRICT JUSTICE: I mean, is that one 22 of the factors? 23 A Yes. 24 BY MR. BEYER: 25 Q Were you afraid at this point? Or you wanted

PAGE 32 1 your keys? 2 A At this point he had done what he was going 3 to do, I felt, and I wanted the keys so he couldn't go 4 back in. 5 Q Through your experience knowing Stan 6 personally all this time, were you afraid for your life? 7 from him? 8 A I was not afraid for my life. 9 MR. BEYER: Thanks. 10 THE DISTRICT JUSTICE: That's all. Thank you. 11 Do you want her to stay in the courtroom? 12 MR. BEYER: I have no obJection to her being l3 dismissed. 14 THE DISTRICT JUSTICE: She can leave. Do 15 you want to go back to work or whatever? Thank you. l6 17 ROBERT E. KAUFFMAN, called as a witness, 18 being duly sworn or affirmed, was examined and testified 19 as follows: 20 THE DISTRICT JUSTICE: Robert E. Kauffman. 21 Two F,s? 22 Q **** * *******. 23 THE DISTRICT JUSTICE: Two N's? 24 A One N. 25 THE DISTRICT JUSTICE: You may go ahead. PAGE 33 1 DIRECT EXAMINATION 2 BY DETECTIVE MATHIAS: 3 Q Mr. Kauffman, would you please Give Your 4 address and your business, what is your vocation? 5 A 1755 Oregon Pike, Lancaster. 6 Q Is that your business address? 7 A Business address and we are in the Financial 8 services business, investment sales. 9 Q Okay, sir. Could you explain to those 10 present what occurred on or about the third and fourth 11 of September, 1987? 12 A Well, I got a call late at night from Karen 13 Loss, the wife of one of our representatives, about 14 eleven-thirty at night. She explained to me that she

15 had received a call from Stacy Waters who claimed to 16 have been held by Stan, that he had entered the building 17 against her will, that he had -- 18 MR. BEYER: I obJect to the hearsay stuff. If 19 he could get to what he knows about it. 20 THE DISTRICT JUSTICE: You don't know whether 21 she did or not, but based on information relayed to you 22 you must have done something. What did you do? 23 A Yes. I was advised that perhaps I should go 24 down to the property and look around, which I did and 25 when I got there, I met at least one detective and PAGE 34 1 Stacy, Allen Loss was there and I was asked to assess 2 the damage and Stacy went around with me and told me 3 what Stanley had done while on the premises primarily 4 and I relayed that information to the detectives and 5 that was it, as far as that night was concerned. 6 BY DETECTIVE MATHIAS: 7 Q You said damages. What had occurred at 8 your business? 9 A Well --- 10 MR. BEYER: I object to that. I think he can 11 testify to what he observed. 12 DETECTIVE MATHIAS: Right. 13 BY DETECTIVE MATHIAS: 14 Q What did you observe? What did you see? 15 A First thing that I saw was first place we 16 went was to my office and I noted there were some files 17 missing. Second place I believe was the computer room 18 where a key was missing to our main file server and it 19 was explained to me that -- 20 MR. BEYER: I object to that. 21 THE DISTRICT JUSTICE: Does he understand 22 about hearsay? 23 DETECTIVE MATHIAS: 24 BY DETECTIVE MATHIAS: 25 Q You can only testify to what you saw. PAGE 35 1 A Okay. 2 Q Or what you know for a fact. 3 A All right. 4 THE DISTRICT JUSTICE: Not what was 5 explained to you. 6 A Got you. I saw that there were -- the wires 7 had been pulled out of the wall in the computer room, 8 that a key was missing to the mind frame of our computer 9 system, that our ADP, or Quotron equipment as it is 10 called, was tampered with, that our computer system was 11 down in all the rooms and that they had been dislodged 12 probably -- well, at that point in time we felt broken -- 13 I was ushered into Mike Hartlett's office where I saw 14 that the desk was broken into, that some files were 15 missing, that I was then taken downstairs where a 16 basement door had been opened and I saw that wires had

17 been torn out of our phone system. I also noted that 18 our burglar alarm was going off for one reason or 19 another. 20 Q You said your phone system 21 A Yes. 22 Q The wires that were tampered with or pulled 22 were your property? 24 A I'm not a phone technician. I don't know a 25 whole lot about the installation. At the time there PAGE 36 1 were three or four -- as you tool at a phone system, you 2 see three or four large panels with hundreds of wires 3 what I knew was -- that there was several hundred of 4 those wires pulled out and that our phones were in fact 5 dead. That's all I know. I'm not a technician. 6 Q Were there any items stolen from your office? 7 A From my office, what was missing was about 8 twenty-five odd files, I would imagine, and some papers 9 from my desk. Nothing much other than that, that I 10 could recall. 11 Q Where are computers in your business? 12 A Yes. 13 Q Were these computers tampered with or 14 damaged? 15 A Well there were essentially, what I recall 16 from that night with -- that our two backup tapes had 17 been taken, which contained all of our information, data 18 on thousands of clients and that from looking at the 19 main computer system and the key being missing, et 20 cetera, I could only assume that had also been 21 tampered with and what we had feared was that we may 22 have lost our entire data base and there may have been 23 some irreparable damage to the main computer frame. 24 Q As a result of these computers having been 25 tampered with, was the operation affected? Did it PAGE 37 1 interfere with normal operations then? 2 A Well, the very next day, essentially we were 3 without the service whereby we quote stock and bond 4 prices for the best part of the day, which I'm sure did 5 cause us some revenue damage. 6 We also were without a phone system till 7 somewhere around noon, which can also be a problem. But 8 I was surprised at how quickly they were able to restore 9 service in both of those cases. The backup tapes that 10 enable us to operate our internal computer systems were 11 recovered very quickly and that enabled us to pretty 12 much run our operation without a whole lot of problem. 13 Q Was there a monetary loss to the company or 14 to you personally as a result of these damages that you 15 were seeing? Or these changes? 16 A There is no question that there were. We got 17 a -- we have a repair bill in our phone system. 18 Q What was that? do you know?

19 A I believe I saw a seven hundred thirteen 20 dollar bill for that one. 21 We had the people from ADP come to our office 22 to restore our Quotron equipment. We don't have a bill 23 from them yet but it is two hundred fifty dollars when 24 the walk on the premises and then goes from there as 25 to how long it takes them to fix it. And they were there PAGE 38 1 all day long. I would suspect that bill would be 2 Fifteen hundred dollars or more. 3 We were able to recover, as I said, the backup 4 tapes but they were worth an awful lot of money to us, 5 would take several thousand man hours to restore the 6 data that is contained on our main computer system. 7 Q Where did you recover these tapes? 8 A I recovered them from the Manheim Township 9 Police about 3:00 a.m. 10 Q On what date- do you know? 11 A It would have been that same night. 12 Q Sir, do you know a Stanley caterbone? 13 A Yes, I do. 14 Q Is Stanley Caterbone privileged to be in your 15 business after closing hours? 16 A No, he's not. 17 Q Was he privileged to be in your business on 18 the date of this offense? 19 A No, he was not. 20 Q Did Stan Caterbone have any right to enter 21 into your office or any other office of FMG? 22 A No, he didn't. 23 Q Did he have any right to remove any items 24 from that business? 25 A No, he didn't.

PAGE 39 1 Q Did he have any right to alter or interfere 2 with your normal operating procedures when it came to 3 the computer system? 4 A No, he didn't. 5 Q Did he have any right to destroy any property 6 within your business? 7 A No, he didn't. 8 Q To the best of your recollection or 9 knowledge, did he have keys or was he capable of 10 entering into your business after closing hours? 11 A No, he didn't have keys. The locks were 12 changed over two months earlier and Stan was not even a 13 key. 14 Q At one time did he have a key to the 15 business? 16 A At one time he did. 17 Q Why would he have a key to the business? 18 A Well, at one time he was involved in the 19 business as an officer, director of the company and he 20 was also a sales representative for us. 21 Q When would he have changed from having

22 privileges of those properties and the privilege of 23 being on your property or the property, to the status of 24 not being privileged to be there? 25 A That happened on July lst.

PAGE 40 1 Q Of 1987? 2 A That's correct? 3 DETECTIVE MATHIAS: I have no further 4 questions of this witness. 5 CROSS-EXAMINATION 6 BY MR. BEYER: 7 Q As you have been testifying on direct 8 examination you have been referring to a small piece of 9 paper on your lap. May I see that, please? 10 A I don't know. There is nothing on it, but 11 you may see it. 12 THE DISTRICT JUSTICE: Are they Just notes 13 to refresh your memory? 14 A That's correct. 15 MR. BEYER: There are several dates and 16 names on there. 17 THE DISTRICT JUSTICE: Dates to refresh your 18 memory? 19 Q That's correct. 20 THE DISTRICT JUSTICE: It is quite all right 21 to have them. He is allowed to see them also. 22 BY MR. BEYER: 23 Q When did you first start working for 24 Financial Management Group? 25 A August lst of 1986. PAGE 41 1 Q How did you come to work for Financial 2 Management Group? 3 A It was a -- I made a decision to join 4 Financial Management Group several weeks before that. 5 I had spoken with both Stan and Mike Hartlett over a 6 period of months before that about beginning an 7 investment services firm in Lancaster. 8 Q And when you say in Lancaster, I assume that 9 you were somewhere else at the time? 10 A That's correct. 11 Q You were in at Lancaster that day? 12 A Correct. l3 Q And, through your past business relationships 14 with Stan and maybe Mr. Hartlett, you were brought to 15 Lancaster or you came to Lancaster to engage in 16 business with them? is that accurate? 17 A Correct. 18 Q And that business was known as Financial 19 Management Group? 20 A Correct. 21 Q And when did that incorporate? 22 A August lst. 23 Q Of 1986? 24 A To the best of my knowledge.

25 Q And upon incorporation what was your office? PAGE 42 1 A I was the President of the firm. 2 Q And what was Mr. Caterbone's position? 3 A He was an executive vice resident of the 4 parent firm. 5 Q What is the Parent firm? 6 A Financial Management Group, Limited. 7 Q Right. What's the corporate setup in terms 8 of persons and offices of the parent firm, Financial 9 Management Group, Limited? 10 A Parent firm, I'm the president of the firm. 11 At that time Stan and Mike were -- equally had a 12 position Just below mine. Their title was executive 13 vice president. Mike reported to me on part of their -- 14 the business operations and Stan on another part. 15 Q All right. In October of 1986, there was a 16 public offering made is that accurate? 17 A Correct. 18 Q And what was the name of that entity? 19 A Financial Management Group, Limited. 20 Q And in that entity you again are president? 21 A Correct. 22 Q And you were a shareholder of sixty thousand 23 shares? 24 A Correct. 25 Q And Mr. Caterbone was a shareholder of forty PAGE 43 1 thousand shares? 2 A Correct. 3 Q And to the best of your knowledge -- 4 THE DISTRICT JUSTICE: Excuse me one second. 5 Go ahead. Public offering in October of -- 6 MR. BEYER: 1986. 7 BY MR. BEYER: 8 Q And Mr. Caterbone at that time was executive 9 vice president. He had forty thousand shares and to 10 our knowledge, he still maintains those shares at this 11 time? 12 A correct. 13 Q Who is the secretary of Financial Management 14 Group, Limited? 15 A I believe it was Stanley. 16 Q And when did he stop being secretary of 17 Financial Management Group, Limited? 18 A The -- he ceased being -- he ceased being an 19 officer at our regular Monday morning meeting which 20 would have been the following Monday. I believe that 21 would have been July 6th. 22 Q So up through July 6th, Mr. Caterbone was the 23 executive vice president and secretary of Financial 24 Management Group, Limited? 25 A correct.

PAGE 44

1 Q And in June of '87 he was also holding that 2 Position officially? 3 A June of '87? 4 Yes. 5 A Correct. 6 Q Now, when was the last ti*e you had a board 7 of directors meeting* go prior to September 4th? 8 A Our board meets on an ever Monday morning 9 basis and has since its inception of August of, 1986. 10 Q Did you have a shareholders' meeting prior to 11 September of 1987? 12 A No, We didn't. 13 Q Who attended the meeting in July in which Mr. 14 Caterbone was removed as a board member? 15 A Robert Long, Allen Loss, myself, Mike 16 Hartlett. 17 Q And it was the decision of those persons who 18 you Just named that Mr. caterbone would be removed as 19 executive vice president and as secretary is that an 20 accurate statement? 21 A What we were advised by our legal counsel. 22 I'm not asking you that. I'm asking you if 23 that decision was made by those persons present at that 24 time? 25 A Decision was made to remove him as an officer PAGE 45 1 of the corporation at that time by those people. 2 Q All right. Now, again you indicated Mr. 3 Caterbone still has fort thousand shares of your stock 4 to the best of your knowledge? 5 A To the best of my knowledge. 6 Q And, as late as August of 1987, am I correct 7 in saying that you offered Mr. Caterbone two dollars and 8 fifty cents per share of that? 9 A That's an oversimplification of what the 10 arraignment was. It was a complicated -- it was a 11 complicated arrangement 12 Q In terms of stock per dollar price that's l3 accurate, correct? Regardless of the other things 14 around it, price per share of stock is that correct 15 A That is the price that we offered on that l6 day. 17 Q Okay. Now, the inability for you to quote 18 the stocks and bond prices on September 4th was as a 19 result of the ADP and not the computer machine, correct? 20 A That's correct. 21 Q And, in fact, you found out that your 22 computer wasn't damaged as a result of what happened 23 that night isn't that correct? 24 A That is substantially correct. 25 Q In fact, you back up your information every PAGE 46 1 single day, which is on the commuter. It anything would 2 have been lost it would have only been for a day? 3 A That's not entirely correct in that what we

4 were -- just so happens that the one night Lisa didn't 5 get to the safe deposit box with our backup tapes and 6 our actual live copy backup tapes were both in on the 7 premises the night that the office was entered. 8 Q Did you lose any information? 9 A Not when the tapes were recovered. 10 Q Okay. Now, who owns the building in which 11 you're located? 12 A I don't know the exact name of the group. l3 That's Herb Fisher Sponaugle, I guess. I guess they 14 have a subsidiary. 15 Q FMG rents that from them, I assume? 16 A Correct. 17 Q How long have you been renting that building? 18 A Since August. Well, August it would be a year- that's 19 I mean, was a staged entry but probably August lst is 20 what's on the -- 21 Q Of 1986* 22 A Correct . 23 Q And that would be a five ear lease* 24 A It is a five year lease. 25 Q And the rent per month is approximately nine PAGE 47 1 thousand dollars, maybe eight and change? 2 A Correct. 3 MR. BEYER: I request to show this to the 4 witness, the lease for the remise. 5 THE DISTRICT JUSTICE: Go ahead. 6 BY MR. BEYER: 7 Q I'm showing you what we will call Defendant' 8 Exhibit No. 1. Are you able to identify that? 9 A Sure. 10 Q Would that appear to be the lease for the 11 premises which you are occupying right now? 12 A Sure is 13 Q And the same premises which were being 14 occupied on September 4th of 1987? 15 A Sure. 16 Q And the name of the lease as individuals is 17 who? 18 A Hartlett, Caterbone and myself. 19 Q Mr. Caterbone is in fact listed as an 20 individual as the lessee of this property, is that 21 accurate? 22 A Well, I'm -- here again, I'm not a scholar 23 but I will say that it was evident that three of us 24 signed for the corporation and there was a personal pass 25 through to our personal assets should the corporation PAGE 48 1 not have been able to pay the rent. I do, as myself, I 2 mean I don't consider that as an individual that I have 3 any claim to that space. It is a corporate lease. 4 Q Right. however, you will agree that you 5 would be individually responsible if in fact that 6 business failed?

7 A No question about that. 8 Q And as would anybody else listed as a lessee* 9 A No question. 10 Q And Mr. Caterbone, for the record, has signed 11 that? 12 A Oh, yes he is responsible. 13 should something happen to our bossiness he is 14 Q Are you familiar with that 15 signature? 16 A Oh, yes. 17 Q Mr. Kauffman I'm showing your financial 18 marked Financial Management Group, Ltd, 19 1987 the time during which you told us that Mr. 20 Caterbone was in fact executive vice president of your 21 corporation. As a board member, would you please tell 22 me who signed his name to this? 23 A Looks like his signature to me 24 Q Are you saying you don't know who signed 25 that Are you saying it is your understanding he signed it? PAGE 49 1 it? 2 A It was definitely my understanding he signed 3 it. That looks like his signature to me. 4 MR. BEYER: Thank you, Mr. Kauffman. 5 DETECTIVE MATHIAS: Is that all the questions 6 you have? 7 MR. BEYER: That's all. 8 DETECTIVE MATHIAS: May I redirect? 9 THE DISTRICT JUSTICE: Go ahead. 10 REDIRECT EXAMINATION 11 BY DETECTIVE MATHIAS: 12 Q Did Stan Caterbone have any right to enter 13 into your office or remove any item from your office, 14 from your property? 15 A No. 16 Q At any time, even as a partner would he have 17 had a right to do that? 18 A Well, the answer to that is, you know, I -- I 19 certainly don't have the ability to go in and destroy 20 things that belong to the corporation, nor do I have the 21 ability to remove things that belong to the corporation 22 from the premises and, you know, that would be -- 23 Q You say able to? 24 A I mean the right. 25 Q Okay. You don't have the right? PAGE 50 1 A No. 2 Q Just by good judgement? Or you don't have the 3 right because of some written law? 4 MR. BEYER: I obJect to that. 5 A I think it is a different legal issue, but we 6 have responsibilities to the corporation as officers of 7 the corporation which would prevent me from doing that. 8 There is certainly nothing on the remise that is 9 outside of my personal office and my personal files that

10 belongs to me. Everything else belongs to the 11 corporation. 12 Q And were any of your personal files taken? 13 A Yes, they were. 14 DETECTIVE MATHIAS: No further questions. 15 RECROSS-EXAMINATION 16 BY MR. BEYER: 17 Q You brought something up here. When I use 18 the word office in the next few questions, I mean our 19 specific office, enclosed space. 20 A Yes. 21 Q How long have you been in the office in which 22 you are now in, meaning the enclosed office of Mr. 23 Kauffman? 24 A Since -- I don't know, maybe August l of 25 1986. PAGE 51 1 Q You have been in the same office? 2 A I mean of '87. 3 Q 1987? 4 A Correct. 5 Q Who had that office before you? 6 A St did 7 Q In fact, he had the locks changed so no one 8 could go in there. However, you had them changed *ga*n 9 so that you could use that office* is that accurate? 10 A That's incorrect. He had left keys with 11 several staff people and the lock is the sam* as the one 12 Stanley has changed that I use. In fact, have the same 13 keys. 14 Q Upon your agreement that Mr. caterbone no 15 longer works for you, you took over his office* is that 16 accurate? 17 A It is kind -- that's an oversimplification 18 but it's not a degree of -- I mean, it is accurate. We 19 turned my office into a conference room to better 20 utilize the space and since Mr. Caterbone was not 21 returning, I used his office. 22 Q You bring up one thing. You were first 23 alerted to this by Mrs. Loss? 24 A we -- well, the break-in on September 3rd, 25 that is correct. PAGE 52 1 Q And isn't it true that you were also aware 2 that Mr. Caterbone had called a meeting for the 4th of 3 September to include Allen Loss, Bob Long, himself, Scot 4 Robertson... in fact, everybody other than you and Mr. 5 Hartlett and you were aware of that? isn't that right? 6 A I was -- I'm going to say, yes and I was not 7 aware of all those -- I was aware of all those names. 8 Q You were aware that the meeting was called. 9 You weren't asked to attend? 10 A Yes. It didn't surprise me 'cause Stan 11 hasn't spoken to me since the day he left. 12 MR. BEYER: Thank you.

13 THE DISTRICT JUSTICE: What was the date of 14 the board action wherein he was removed? 15 A The date of the board action was the 16 following Monday, which I believe is the 6th. 17 THE DISTRICT JUSTICE: Of July? 18 A July. 19 THE DISTRICT JUSTICE: That's all. Thank you. 20 BY MR. BEYER: 21 Q Did you invite Mr. Caterbone to that meeting? 22 A Mr. Caterbone had a standing invitation to 23 every board meeting since the day we opened on every 24 Monday morning. 25 MR. BEYER: Thank you. PAGE 53 1 THE DISTRICT JUSTICE: That's all. 2 MR. BEYER: He may be released as far as I'm 3 concerned. 4 THE DISTRICT JUSTICE: Go back to business. 5 Thank you 6 7 DANIEL ANTHONY BERGER, called as a witness, 8 being duly sworn or affirmed, was examined and testified 9 as follows: 10 DIRECT EXAMINATION 11 BY DETECTIVE MATHIAS: 12 Q Would you please tell us where you live and 13 what you do for a living, where you are employed? 14 A I am currently living at clock Towers 15 Apartments. I'm employed by Berger Real estate as a 16 realtor associate. 17 Q could you please explain to those present 18 what occurred on the 3rd or 4th of September, 1987 in 19 the evening hours? 20 A Okay. I was at Cousteau's Restaurant 21 approximately ten-thirty in the evening. Stan Caterbone 22 entered the bar. I immediately, you know, noticed him 23 coming in. He conversed with several people in the bar 24 and it was brought to my attention that he had told 25 individuals that he had Just broken into the office of PAGE 54 1 Financial Management Group. 2 Subsequently, after a period of time, I 3 a roached Stan, asked him what exactly happened, why he 4 did what he had done. You know, I guess we had an 5 exchange of words to the effect I felt he was acting 6 very stupidly as far as handling whatever grievance he 7 mi *t have with Financial Management Group and 8 subsequently he left and from there I left shortly 9 thereafter. 10 I left Cousteau's myself and immediately went 11 out to the office of Financial Management Group to see 12 what had taken lace and in fact, notified the police 13 that he had, if they had not already been notified. 14 Q I'm a little bit confused. Did Stan 15 Caterbone actually tell you he had done something?

16 A Yes. He admitted through our conversation 17 that he had done this. 18 Q Done what? 19 A That he had gone in, taken files of which he 20 supposedly had in the car. He had, you know, torn out 21 computer lines to sabotage the office. 22 Q Did he actually use the word sabotage? 23 A No, but, you know, in fact, you know, a 24 business of that nature, to destroy their computer 25 network would be. PAGE 55 1 Mr. BEYER: I object to that. That's 2 speculative. 3 BY DETECTIVE MATHIAS: 4 Q You know Stan Caterbone? 5 A Yes. 6 Q Is he here now? 7 A Yes. 8 Q Would you please point to him? 9 A Doing same. 10 DETECTIVE MATHIAS: Seated next to counsel. 11 BY DETECTIVE MATHIAS: 12 Q Has any mention made concerning an air lane? 13 A Yes. At one time Stan had, to the best of my 14 knowledge, purchased an aircraft from Lancaster 15 Aviation. Subsequently, to the best of my knowledge, I 16 understand it was repossessed due to failure of payment 17 and he has mentioned to Harry Lutz, who was a friend of 18 mine, that he was guest bartender, you know, he was 19 bartending that evening and he had requested Harry to 20 steal the plane for him. 21 Q For any specific reason? What were they 22 going to do with this plane? 23 A He felt it was -- 24 MR. BEYER: I obJect to that. He doesn't know 25 what he felt. If he knows something he can state it. PAGE 56 1 BY DETECTIVE MATHIAS: 2 Q Did Stan Caterbone actually make a comment to 3 you that he was oin to take this plane? 4 A I don't know that it was -- that subject was 5 never directly mentioned to me by Stan. 6 DETECTIVE MATHIAS: Fine. 7 MR. BEYER: Thank you. 8 CROSS-EXAMINATION 9 Q Mr. Berger, you also have an association with 10 Financial Management Group? 11 A That is correct. 12 Q How long have you had that association? 13 A On and off for--the last approximately twelve 14 months. 15 Q Who was the first person to get you involved 16 with Financial Management Group? 17 A Stan. 18 Q Okay. And this conversation at Cousteau's

19 took place around ten-thirty in the evening? 20 A No. It was later than that. 21 Q Later than that? 22 A Yes. 23 MR. BEYER: Thank you. 24 THE DISTRICT JUSTICE: Are you the person that 25 called the police? PAGE 57 1 A No. 2 THE DISTRICT JUSTICE: Do you know who did? 3 A I believe it was the young lady that was 4 cleaning the offices that evening. 5 THE DISTRICT JUSTICE: Okay. Thank you. 6 That,s all 7 8 A No, I don't. 9 MR. BEYER: Thank you. He may be excused. 10 I'm finished. You can leave' Thank you. 11 DETECTIVE MATHIAS: I,m the next witness. Do 12 you want me to stay here or go up there? 13 THE DISTRICT JUSTICE: If you have thousands 14 of papers that you have to constantly refer to by going 15 back and forth, then, why, your request is granted. If 16 you don't, then everybody should use the witness chair 17 in the proper court of criminal law. 18 19 LARRY MATHIAS, called as a witness 20 being duly sworn or affirmed, was examined and testified 21 as follows: 22 DIRECT TESTIMONY 23 DETECTIVE MATHIAS: I'm Detective Larry 24 Mathias of the Manheim Township Police Department*, 25 employed as an investigator and was so employed on the PAGE 58 1 4th of September, 3rd and 4th of September, 1987 as a 2 sworn law enforcement officer of Manheim Township. 3 On that date at approximately -- on the 3rd of 4 September at approximately lO:30 p.m., our police 5 personnel were dispatched to MFS, located at 1755 Oregon 6 pike MR. BEYER: Let the record show I think he 8 meant FMG. 9 A Okay. Financial Management Group -- 10 concerning an unlawful entry to the building and a theft 11 of properties from the building. In going to that 12 location it was confirmed and appeared that items had 13 been moved and in speaking with all the witnesses who 14 had previously testified, subsequently Stanley caterbone 15 was arrested. 16 On that evening at a proximately three o'clock 17 items were seized from him on the 4th of September and 18 were items believed to have been the property of this 19 organization. 20 Based on all the information, Stanley 21 Caterbone was charged by me.

22 MR. BEYER: I will stipulate to the charges. 23 A All of them excluding the robbery? 24 MR. BEYER: Right. 25 DETECTIVE MATHIAS: And I believe truly that PAGE 59 1 the acts were committed and that these sections and the 2 requirements of these sections, specifically the 3 computer, that's a new one. That's one that I have 4 never brought before. 5 I believe that Stanley Caterbone did interfere 6 with the normal operating procedures of that operation 7 and I do believe that he did remove from that 8 organization property that he was not entitled to 9 regardless of his position with that company. 10 I do believe that he entered into that 11 building in an unlawful way and I do believe that he 12 committed a crime while he was there and I believe he 13 unlawfully restrained a young lady against her will, all 14 said acts to have occurred in Manheim Township. 15 CROSS-EXAMINATION 16 BY MR. BEYER: 17 Q Detective Mathias, in terms of the actual 18 custody of Mr. Caterbone, am I accurate in stating a 19 different police department was dispatched to pick him 20 up? 21 A Correct. 22 Q That would have been the Pequea Township or 23 Conestoga Township? 24 A That is correct. 25 Q And to the best of your knowledge, at the PAGE 60 1 time he was apprehended, did he ask permission to go to 2 his house to bring certain items? 3 A I believe he did. 4 Q In fact, he brought loads of files to the 5 police department to indicate to you what he had 6 taken and to try to explain. 7 A I know that a lot of items -- several items 8 were brought to the police station. I didn't personally 9 inventory those items. I'm not sure what was brought. 10 Q To the best of your it was his 11 incentive to bring them to you? 12 A Yes, it was, yes. 13 MR. BEYER: Then 14 questions. 15 DETECTIVE MATHIAS: 16 prosecution. 17 MR. BEYER: Your honor I have a demurrer. 18 DETECTIVE MATHIAS: Do you want to their 19 case now? Or before we move on with that? 20 THE DISTRICT JUSTICE: Let's settle this one 21 first. Then we have to go to Detective Siegler's 22 hearing. 23 MR. BEYER: Your honor, I think I will try to 24 address them in the order that they are in the

25 Complaint. With respect to the burglary, it's been PAGE 61 1 undisputed that Mr. Caterbone as, well as Kauffman and 2 Hartlett are individuals on the lease of the premises in 3 which he is accused of burglary in . 4 The lease is a nine thousand dollar a month 5 leasehold which Mr. Kauffman has told us each individual 6 could be or is individually responsible for should the 7 business fold. In common law, an individual who has 8 such a leasehold does have a privilege to enter those* 9 premises. 10 While there would not be an excuse for n 11 theft that would have occurred therein, had it occurred 12 a burglary would be an improper prosecution to follow 13 with there because of the obvious leasehold interests 14 that he not only had but still does have in those 15 premises. 16 Consequently, we would feel that the burglar 17 would need to be dismissed against Mr. Caterbone for 18 those reasons. 19 THE DISTRICT JUSTICE: We will take them one 20 at a time so we don't et all confused. Now burglar 21 there is a demurrer saying that number one, he has a 22 right to be there and therefore he could break down the 23 door, Jimmy a window or something but he didn't do an 24 of those things at all. He was led into the building by 25 this young lady and from then on he never broke a door PAGE 63 1 down or smashed a window or anything- is that correct? 2 DETECTIVE MATHIAS: No. he forcibly removed 3 the keys and then that entitled him to make entries to 4 these other rooms. 5 MR. BEYER: That's not accurate. He was led 6 into the building by the girl. 7 DETECTIVE MATHIAS: He was left into the 8 building by that young lady at the door. 9 THE DISTRICT JUSTICE: That's right. 10 DETECTIVE MATHIAS: Then he took the keys n 11 that's how he gained access to several offices. 12 MR. BEYER: She said the only place that keys 13 needed to be used were the basement and he had the key -- 14 he knew the key was there. He had the key. All the 15 offices were empty or were open and she stated that 16 specifically and even still, the guy was a leasehold on 17 the building. 18 THE DISTRICT JUSTICE: 19 to be decided. 20 MR. BEYER: I think we offered the evidence 21 and shown it through the witness who admitted it. 22 THE DISTRICT JUSTICE: Your context 23 disregarding the leaseholder privilege that the 24 that he used the key to go to the basement after he was 25 allowed in the building constitutes burglary? PAGE 63

1 DETECTIVE MATHIAS: I base it on the fact that 2 he entered offices that he would not be privilege to 3 enter. He remove property from those offices that he's 4 not entitled to regardless of the leasehold. 5 THE DISTRICT JUSTICE: Removing is one thing. 6 That's the crime within. But he has let in by the young 7 lady. He didn't forcible enter a structure at all. 8 MR. BEYER: That's accurate, Judge. 9 THE DISTRICT JUSTICE: All right. You may 10 continue with your demurrer. 11 MR. BEYER: With respect to the unlawful 12 restraint, unlawful restraint was a requirement the 13 individual involved be -- and I think Detective Mathias 14 is going to agree with this -- let me find it 15 specifically for you -- the unlawful restraint 16 element that the individual restrained is exposed to 17 risk of serious bodily injury. Serious bodily injury 18 defined and it is defined if he is in imminent danger of 19 death or protracted loss of an organ. 20 Miss Waters, although admittedly at two points 21 was scared, once because of the dark. She admitted that 22 she wasn't in fear for her life. There were times when 23 they were out in the parking lot she could have ran. 24 She admitted that he waited for her to get back into the 25 building because it was dark outside. He wanted to get PAGE 64 1 her in safely. 2 She also admitted a goodbye kiss. Under the 3 circumstances, I'm sure that this does not amount to an 4 unlawful restraint under the meaning of the Crimes Code. 5 I don't know that's going to be debated by the other 6 side. 7 DETECTIVE MATHIAS: No comment on that. 8 MR. BEYER: I will not offer a demurrer at 9 this time to a theft or the computer charges and only in 10 terms of the criminal mischief that I would point out 11 that damage is an element of that offense because of 12 grading and I don't know that the element has been l3 satisfied 14 And they would be the only demurrers I would 15 have to these charges, specifically towards the burglary 16 and unlawful restraint. 17 THE DISTRICT JUSTICE: Do you want to rebut 18 the criminal mischief demurrer that there is no damage, 19 no value? 20 DETECTIVE MATHIAS: I think there is clearly a 21 cost factor. 22 MR. BEYER: I withdraw the criminal mischief 23 demurrer. 24 THE DISTRICT JUSTICE: Something here has to 25 have value. the telephones. PAGE 1 MR. BEYER: I withdraw that demurer. I think 2 he said se*en fifteen. 3 THE DISTRICT JUSTICE: All right. If we have

4 no demurrer and we have no defense testimony? 5 MR. BEYER: That's correct, Your honor. 6 THE DISTRICT JUSTICE: I will rule that the 7 Commonwealth has established a prima facie case on the 8 unlawful use of computer and theft by unlawful taking 9 and the Defendant is ordered to be bound over for the 10 next term of court on those three charges. 11 And now we have the other count high alleges 12 terrorstic threats. Do you have a copy? l3 MR. BEYER: I have a copy and I will waive the 14 reading. 15 16 JUNE KEMPER, called as a witness, 17 being duly sworn or affirmed, was examined and testified 18 as follows: 19 DIRECT EXAMINATION 20 BY DETEcTIVE SIEGLER: 21 Q State your name and your employer, lease. 22 A June Kemper, employed by Financial Management 23 Group. 24 Q In what capacity? 25 A Receptionist telephone operator. PAGE 66 1 Q Were you so employed in the first of 2 September, 1987? 3 A Yes. 4 Q In that capacity? 5 A Yes. 6 Q Did you receive any type of phone call other 7 than a normal business phone call on that date? 8 A I thought it was, yes. 9 Q And about what time did that happen? 10 A I think between about ten ten-thirty. in 11 that area. At the time I notified somebody but I didn't 12 write it down. I think it was at that area. 13 Q And what was the extent of the phone call 14 that you received? 15 A The party answered and he didn't give a 16 name. They Just said, if I were you I would not stay in 17 that building today. And a comment was, why. And they 18 hun up. 19 Q All right. I would like to read to you what - 20 would I be correct in saying that, I would advise you 21 all to get out of the building if you value your safety? 22 MR. BEYER: I obJect to that. 23 THE DISTRICT JUSTICE: On what basis? 24 MR. BEYER: First of all, it is not a 25 question. Second of all, she stated what was said on PAGE 67 1 the phone. The detective putting stuff into evidence 2 that's not no basis or foundation from a witness. 3 THE DISTRICT JUSTICE: Agreed. 4 BY DETECTIVE MATHIAS: 5 Q Mrs. Kemper, do you want to tell me again 6 what the caller said?

7 A I answered the phone. No name. Party said 8 to me, if I were you I would not stay in that building 9 today and I asked why and they hung up. 10 Q Okay. Do you recognize or did you recognize 11 the caller? 12 A Yes. 13 Q Who was that caller? 14 A Stanley Caterbone. 15 Q And do you see him in the courtroom? 16 A I don't know Stanley, but I assume this 17 gentlemen over here is Stanley. 18 Q But you recognized his voice? 19 A Yes, I recognized his voice. 20 DETECTIVE MATHIAS: Thank you. 21 have nothing 21 further. 22 CROSS-EXAMINATION 23 BY MR. BEYER: 24 Q How do you recognize his voice? 25 A Because he called frequently. PAGE 68 1 Q And you have talked to him before? 2 A He identified himself on occasions and on one 3 occasion it was more -- it was another comment made to 4 me. 5 Q How long have you worked for Financial 6 Management Group? 7 A Since July l5th. 8 Q Of 1987? 9 A That's correct. 10 Q And, after you got this phone call you 11 notified someone else in the building? 12 A Yes, I did, immediately. 13 Q Did you call the police? 14 A I didn't, no. 15 Q Do you know whether they did the same day? 16 A I think so. 17 Q Did you evacuate the building? 18 A No. I was scared. 19 Q Did you evacuate the building? 20 A No. 21 MR. BEYER: Thank you. 22 DETECTIVE MATHIAS: One other question, Your 23 Honor. 24 REDIRECT EXAMINATION 25 BY DETECTIVE MATHIAS: PAGE 69 1 Q Mrs. Kemper, after you got the phone call and 2 you hung up the phone, what did that phone call mean to 3 you? 4 A I was afraid 5 Q Afraid of what? 6 A I was afraid that there was a bomb or 7 something in the building. That's what entered -- 8 that's what I thought. 9 DETECTIVE MATHIAS: Thank You.

10 A That was my thought. 11 MR. BEYER: I have no questions. 12 THE DISTRICT JUSTIcE: Were the police called? 13 A I think Bob. I didn't call the Police- 14 THE DISTRICT JUSTICE: Did you ever see any 15 police around there then that day? 16 A This gentlemen came over. 17 THE DISTRIcT JUSTIcE: Do you know that he was 18 a policeman? 19 A Yes. He identified himself. 20 THE DISTRICT JUSTICE: So the did come that 21 day? 22 A Yes. 23 THE DISTRICT JUSTICE: Is that right? 24 A Yes. 25 THE DISTRICT JUSTICE: They did come. So PAGE 70 1 somebody must have called? 2 A I think Bob Kauffman called, but I don't know 3 that. 4 THE DISTRICT JUSTICE: You got this call and 5 then a little while later there is a Policeman or 6 detective there? 7 A He came and they wanted my statement. 8 RECROSS EXAMINATION: 9 BY MR. BEYER: 10 Q This was September lst that the call came in? 11 A September lst, yes. 12 Q Might the policeman not have come until l3 September 3rd? 14 A I really can't answer. I thought it was the 15 same day. I can't answer that. l6 MR. BEYER: That's okay. I have no obJection 17 to this lady being excused, going about her business. 18 THE DISTRICT JUSTICE: Thank you. That's all. 19 20 LARRY C. SIEGLER, called as a witness, 21 being duly sworn or affirmed, was examined and testified 22 as follows: 23 DIRECT TESTIMONY 24 DETECTIVE SIEGLER: Your honor, on or about 25 lO:O0 a.m. on the 3rd of September, I was notified by PAGE 71 1 Mr. Kauffman concerning the phone call that Mrs. Kemper 2 had just testified to. I immediately went to the 3 building and I searched the building. I was unable to 4 find anything and based on the information that I had 5 received from Mrs. Kemper, I filed a charge of 6 terrorIstic threats, Crimes Code Section 2706. 7 MR. BEYER: I will stipulate to that stuff 8 THE DISTRICT JUSTICE: You don't 9 all that. 10 A It was signed 11 September, 1987 -- 12 THE DISTRICT JUSTICE: Any questions?

l3 A -- against Mr. Caterbone? 14 MR. BEYER: Just a couple. 15 CROSS-EXAMINATION 16 BY MR. BEYER: 17 Q The incident allegedly occurred on September 18 lst? 19 A That's Correct. 20 Q And you went out there on September 21 immediately upon being called? 22 A That's correct. 23 Q And the statement which was given by 24 Mrs. Kemper was the actual statement which she told you 25 happened? PAGE 72 1 A That's correct. 2 Q Okay. So if there is a discrepancy the 3 statement which was taken from her would be most 4 accurate? 5 A That's correct. 6 MR. BEYER: All right? Thank You. 7 THE DISTRICT JUSTICE: That's aLL. 8 MR. BEYER: Judge -- I assume you're finished? 9 DETECTIVE MATHIAS: Yes. 10 MR. BEYER: I have a demurrer. 11 (Mr. Beyer presented oral argument 12 to the court on behalf of the Defendant.) 13 THE DISTRICT JUSTICE: No rebuttal? 14 DETEcTIVE MATHIAS: No, sir. 15 THE DISTRICT JUSTICE: I don't think a crank l6 phone call is enough, even on a prima facie basis to 17 constitute a terroristic threat charge and the demurrer 18 will be allowed and that one will not be returned to 19 court. The others will. 20 The Defendant is continued on his bail and he 21 is ordered to be bound over for the next term of court 22 on the charges previously outlined. 23 (The proceeding was concluded 24 at this time.) 25 PAGE 73 1 2 REPORTER'S CERTIFICATE 3 4 I HEREBY CERTIFY that I was present upon the 5 hearing of the above-entitled matter and there reported 6 stenographically the proceedings had and the testimony 7 produced; and I further certify that the foregoing 8 is a true and correct transcript of my said 9 stenographic notes. 10 11 12 13 14 Charles A. Long, RPR 15 Official Court Reporter

DI= *********************************************************** TI=\SIR SPEEDY PRINTING INVOICE FOR DOCUMENTS IM=163P01.CPR DA= October 5, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: Invoice from Sir Speedy Printing Center, 301 N. Queen St Lancaster, PA, for the duplication of 1103 images billed to the law firm of Arnold, Beyer & Homsher for Stan Caterbone, client. DI= ************************************************************ TI=\FARMERS FIRST BANK ATTEMPTED EMBEZZLEMENTIM=164P01.CPR DA= October 7, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: Copy of a check to Stan Caterbone for $138.45 drawn against FSC Agency, Inc. for insurance commissions due. Stan Caterbone proceeded to the Park City Shopping Center in Lancaster, and attempted to first cash the check at Farmers First Bank. The tellers acted suspicious and walked away from the counter, and refused to cash the check, and ever more amazing is the fact that the teller had actually tried to keep the check. Stan Caterbone immediately became load, and demanded the check back at once. Hamilton Bank also refused to cash the check. DI= ************************************************************ TI=\FMG, Ltd., vs. S. CATERBONE RE: FURNITURE IM=165P01.CPR DA= October 9, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 2 SU= SUMMARY: A letter from attorney Robert Beyer to attorney Christine Hausner, representing Craig Russell, regarding the charges of FMG, Ltd., filed against Stan Caterbone. It looks as though the furniture and other incidental personal artifacts is far more important than the illegal criminal charges filed with malicious motives against Stan Caterbone. IM=165P02.CPR DI= PAGE 02 DI= ************************************************************ TI=\TITLE: INTERCON INVESTIGATION SERVICES IM=166P01.CPR DA= October 10, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 3 SU= SUMMARY: Resume and services of Intercon Special Services, Inc., of New York, NY. Stan Caterbone had traveled to New

York after first visiting with attorney Mike McDonald of Philadelphia, for a meeting with Frank Garrity, an investigator for Intercon Special Services. Intercon was supposed to specialize in white collar crime. Stan Caterbone received the basic blank doubting stares. IM=166P02.CPR DI= PAGE 02 IM=166P03.CPR DI= PAGE 03 DI= ************************************************************ TI=\CAPELLO & FOLEY RETURN PACKAGE IM=167P01.CPR DA= October 10, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: The address label from the package of 3 Binders that the law firm of Capello & Foley sent to Stan Caterbone. In July, Stan Caterbone had traveled to Santa Barbara, CA to attempt to retain Barry Capello, a leading specialist in lender liability, who is often published in law journals. DI= ************************************************************ TI=\MARION STREET REAL ESTATE SALE IM=168P01.CPR DA= October 12, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/04/07/08 PA= PAGES: 2 SU= SUMMARY: Letter from James D. Warner, currently of 433 West Marion Street, Lancaster, PA to Robert Byers, attorney of Stan Caterbone. Jim Warner had purchased the property of 433 W. Marion Street from Stan Caterbone. IM=168P02.CPR DI= PAGE 02 DI= ************************************************************ TI=\HAMILTON VISA CARD IM=169P01.CPR DA= October 28, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: Collection letter from Corestates Bank, Hamilton Bank to Stan Caterbone regarding a delinquent balance of $3,559. Most of the charges were sustained after Stan Caterbone suffered a loss of income, on July 1, 1987. DI= ************************************************************ TI=\PARENT FEDERAL SAVING APPRAISAL IM=170P01.CPR DA= October 28, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1

SU= SUMMARY: The first actual correspondence from Parent Federal Savings & Loan, since Stan Caterbone's last mortgage payment, for June, 1987. Residential Appraisal Specialists, Inc., informing Stan and Mike Caterbone of of periodic inspections that Parent Federal has authorized. DI= ************************************************************ TI=\BEYER DEFENSE COUNSELING IM=171P01.CPR DA= November 20, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: A letter to Stan Caterbone from attorney Robert Beyer regarding informal discovery request, and the preparation of a defense against the criminal charges filed against Stan Caterbone. DI= ************************************************************ TI=\PA UNEMPLOYMENT COMPENSATION REVIEW FINDING OF FACTS IM=172P01.CPR DA= November 9, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: "Findings of Fact" of the Notice of Determination handed down by the Office of Employment Security concerning the claim for unemployment compensation benefits filed by Stan Caterbone in the days surrounding his arrest. The decision ruled that Stan Caterbone was not eligible for benefits because he was "terminated from employment from Financial Management Group, Ltd., on July 1, 1987". Of which they cited that Stan Caterbone had entered the building and removed financial records, apparently the titles of secretary, not to mention others, means nothing DI= ************************************************************ TI=\PA SECURITIES INVESTIGATION LETTER IM=325.CPR DA= November 25, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: A letter to Stan Caterbone, from Howard L. Eissler, Securities Investigator for the Pennsylvania Securities Commission. After 60 days from the previous 5 hours of discussions with Stan Caterbone, at 2323 New Danville Pike, Howard Eissler is now just asking Stan Caterbone to submit his complaint in writing. Apparently the reams of copied documents that were submitted to the Commission were of no consequence without the proper form!!! And of course it took 60 days to find the proper form? DI= ************************************************************ TI=\SCHWELLER INVOICE FOR LEGAL FEES IM=174P01.CPR

DA= November 30, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: Another invoice to Stan Caterbone from attorney Lew Schweller for all of the services and help that he was giving to Stan Caterbone, $1,460.21 worth. DI= ************************************************************ TI=\GOOD SHEPPARD INDUSTIRES INVOICE FOR MICROFILM IM=175P01.CPR DA= November 30, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: An invoice from Good Sheppard Industrial Services, of Allentown, PA to Stan Caterbone for costs incurred to process 9,079 documents to diazo and silver duplicates of microfiche. The bill is still outstanding. DI= ************************************************************ TI=\McNEESE, WALLICK, & NURIC RECEIPT FOr MATERIALS IM=176P01.CPR DA= December 1, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: A receipt from attorney Jeff Jamouneau of McNeese, Wallace, & Nurick, of Harrisburg to Stan Caterbone, of Global Entertainment Group, Ltd., for receipt of a package of documents from Stan Caterbone. Stan Caterbone visited several others in Harrisburg on that and also delivered the similar packages. Those on tour for that day included Howard Eissler, of the PA SEC; Senator Gib Armstrong; and Governor Robert Casey. Documents were merely evidence of the conspiracy.s DI= ************************************************************ TI=\US POSTAL INSPECTOR LETTER RE: COMPLAINTS IM=177P01.CPR DA= December 17, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: A letter from J.M. Jones, the Postal Inspector, of the Office of the Inspector In Charge to Stan Caterbone that contains a form used to file a formal complaint for an illegal change of address. DI= ************************************************************ TI=\POSTAL COMPLAINT FILED BY US POSTAL INSPECTORIM=178P01.CPR DA= December 19, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: Complaint No: 08662 filed by Stan Caterbone to the

Office of the Inspector In Charge for an alleged illegal change of address against Michael Hartlett, Alan Loss, and Robert Kauffman, of FMG, Ltd., DI= ************************************************************ TI=\S. CATERBONE vs. SCOTT ROBERTSON IM=179P01.CPR DA= January 7, 1988 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: Civil Complaint A-503-87 filed in the District Court of Murray Horton, Manheim Township, against Scott Robertson of FMG, Ltd., for the $2,000 that Stan Caterbone had loaned to Scott Robertson, on May 11, 1987 that was never paid. Stan Caterbone has never collected this debt. DI= ************************************************************ TI=\PA UNEMPLOYMENT COMPENSATION REFEREE' DECISION IM=180P01.CPR DA= January 9, 1988 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: Referee's Decision by the Pennsylvania Unemployment Compensation Board of Review ruling that Stan Caterbone was "Ineligible" for benefits under Section 402 (e), "Willful Misconduct". Again citing that Stan Caterbone was terminated on July 1, 1987, by Robert Kauffman and Michael Hartlett, for entering the premisses and removing the corporate records. DI= ************************************************************ TI=\PA UNEMPLOYMENT APPEAL RESPONSE IM=181P01.CPR DA= January 8, 1988 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 3 SU= SUMMARY: Letter from Stan Caterbone to Evelyn Stehman, of the Unemployment Compensation, Board of Review. IM=181P02.CPR DI= PAGE 02 IM=181P02.CPR DI= PAGE 03 DI= ************************************************************ TI=\INVOICE FROM SECRETAR-ALL FOR TRANSCRIPTION IM=182P01.CPR DA= January 13, 1988 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: Invoice from Secretar-All for the transcribing of 10 microcassettes for Stan Caterbone. Most of the tapes included conversations with Howard Eissler of the Pennsylvania Securities & Exchange Commission.

DI= ************************************************************ TI=\MOBILE HOME PURCHASE INVOICE IM=183P01.CPR DA= January 14, 1988 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: A sales receipt from Mellott Bros., Trailer Service, of Willow Street, PA to Stan Caterbone for the purchase of a 1972 Open Road Mobile Home, for $5,000. Stan Caterbone was preparing to travel to California for another attempt at retaining competent legal council. DI= ************************************************************ TI=\PA HOMEOWNER'S EMERGENCY ASSISTANCE DENIAL IM=184P01.CPR DA= January 26, 1988 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: A Rejection notice from the Housing Finance Agency, Homeowners Emergency Assistance Program, issued to Stan Caterbone. The Homeowners Emergency Assistance Program is designed to provide mortgage payments to persons suffering financial hardship beyond their control. They cited the fact that "mortgagor was terminated from job" as a contributing factor for denial. DI= ************************************************************ TI=\LANCASTER AVIATION vs. S. CATERBONE CIVIL SUIT IM=185P01.CPR DA= February 4, 1988 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: Chuck Smith files a civil suit in the court of Murray R. Horton, District Justice, for $3,411.81. Of which most or all were illegitimate charges. DI= ************************************************************ TI=\PARENT FEDERAL SAVINGS vs. CATERBONE FORECLOSURE IM=186P01.CPR DA= March 14, 1988 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 2 SU= SUMMARY: Action in Mortgage Foreclosure against Stanley J. Caterbone and Michael T. Caterbone filed by Parent Federal Savings and Loan, owned by James Guerin, for the residence of Stan Caterbone, located at 2323 New Danville Pike, Conestoga, PA 17516 IM=186P02.CPR DI= PAGE 02 DI= ************************************************************

TI=\BEYER'S CRIMINAL LEGAL FEES INVOICE IM=187P01.CPR DA= March 21, 1988 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 4 SU= SUMMARY: Detailed invoice from Attorney Robert D. Beyer, for legal services for the defense against the criminal charges filed by Manheim Township Police of September 3rd and 4th of 1987. Invoice details all phone calls, meetings and conference related herewith. IM=187P02.CPR DI= PAGE 02 IM=187P03.CPR DI= PAGE 03 IM=187P04.CPR DI= PAGE 04 DI= ************************************************************ TI=\CRIMINAL CHARGES & RESTITUTION NOTICE IM=188P01.CPR DA= March 21, 1988 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: Letter from Robert Beyer to Stan Caterbone informing him that as of March 15, 1988, over 180 days after the arrest, that all criminal charges are dismissed and that the restitution of over $2,000 have been paid. DI= ************************************************************ TI=\MARY JANE JACKSON/ACQUAINTANCE IM=189P01.CPR DA= March 22, 1988 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: During a flight from California to Philadelphia in early March, after returning from the meeting with Attorney S. Gray, Stan Caterbone met a woman that had associates in the video business. Stan Caterbone had discussions regarding the circumstances surrounding the summer of 1987. The woman sent a letter of references and had mentioned her wishes to follow up with giving the story to Ted Turner or 60 Minutes, as Stan Caterbone had discussed. DI= ************************************************************ TI=\ISC EDUCATIONAL SYSTEMS DENIAL IM=190P01.CPR DA= April 27, 1988 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: A letter from Norm Skeleton, of ISC International Technologies Group, Inc., to Stan Caterbone informing him that his sales and marketing background was not sufficient for

a position with ISC Educational Systems, a company that produces interactive video applications. DI= ************************************************************

TI=\PENNSYLVANIA HOUSING FINANCE AGENCY "NOTICE OF DECISION OF HEARING"IM=329A.CPRDA= April 28, 1988AT= AUDIO TRACKS: /ALLPA= PAGES: 03

SU= SUMMARY: In October of 1987, Stan Caterbone had applied for the 'Homeowners Emergency Mortgage Assistance Program' in an effort to thwart the foreclosure proceedings of James Guerin' Parent Savings and Loan. Stan Caterbone wanted to prevent being thrown out on the streets.

After several meetings and conversations with Michael J. Cooper, the Board of Decisions ruled that Stan J. Caterbone was ineligible for several reasons. Included in the decision was the reference to the Bureau of Labor and Statistics findings that the circumstances were a result of "termination from job".

Ironically, Mike McDonald, an attorney representing Stan Caterbone, had called Michael Cooper, and again made allegations of insanity. "Subsequent to the appeal hearing, the Appellant's attorney, Michael McDonald, presented evidence that the appellant has been suffering from a bipolar mood disorder. This psychiatric illness, which is genetic in character, became severe during the summer of 1987 and later resulted in the hospitalization of the Appellant in September of 1987. His family has a history of psychiatric illness. The debilitating and disorienting impact of this illness appears to have led to the appellant's dismissal from employment."

Stan Caterbone was not aware of the above information that Mr. McDonald had provided to the agency, until February of 1991.IM=329B.CPRDI= PAGE 02IM=329D.CPRDI= PAGE 03DI= ************************************************************ TI=\KAUFFMAN STOCK REPURCHASE AGREEMENT IM=192P01.CPR DA= October 25, 1988 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 9 SU= SUMMARY: The Agreement between Robert Kauffman and Stan Caterbone that was mediated by Scott Robertson, for the purchase of 40,000 shares of FMG, Ltd., stock that Stan Caterbone owned. IM=192P02.CPR DI= PAGE 02 IM=192P03.CPR DI= PAGE 03 IM=192P04.CPR DI= PAGE 04 IM=192P05.CPR

DI= PAGE 05 IM=192P06.CPR DI= PAGE 06 IM=192P07.CPR DI= PAGE 07 IM=192P08.CPR DI= PAGE 08 IM=192P09.CPR DI= PAGE 09 DI= ************************************************************ TI=\GREENFIELD ASSOCIATES EMPLOYMENT SOLICITATION IM=193P01.CPR DA= January 12, 1989 AT= CORRESPONDING AUDIO TRACKS: 01/02/04/05/06/07/08 PA= PAGES: 3 SU= SUMMARY: Letter to Richard E. Blouse, President of Greenfield Associates, a subsidiary of High Industries, from Stan Caterbone requesting interview for employment considerations. Also attached is a resume of Stan Caterbone. IM=193P02.CPR DI= PAGE 02 IM=193P03.CPR DI= PAGE 03 DI= ************************************************************ TI=\S. CATERBONE CREDIT REPORT OF AUGUST 8, 1989 IM=194P01.CPR DA= August 8, 1989 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 4 SU= SUMMARY: A copy of a Credit Report for Stan Caterbone, on August 8, 1989 substantiating the damaged credit worthiness from the activities surrounding June and July of 1987. IM=194P02.CPR DI= PAGE 02 IM=194P03.CPR DI= PAGE 03 IM=194P04.CPR DI= PAGE 04 DI= ************************************************************

TI=\AMERICAN HELIX vs. ADVANCED MEDIA GROUP, Ltd., CD-ROM BUSINESSIM=309.CPRDA= May 21, 1990AT= AUDIO TRACKS: /05PA= PAGES: 01

SU= SUMMARY: Dave D. Dering, President of American Helix, provided written documentation and verification that Stan Caterbone and the Advanced Media Group, Ltd., will be given the opportunity to take possession of the information technologies (CD-ROM) business and continue to grow that business with all equity reverting to Stan Caterbone.

High Industries had recently elected to discontinue the capitalization of this business, including the consulting fees then being paid to

Stan Caterbone. High Industries had recently lost in upwards of $1 million dollars from the CD-ROM efforts, and other efforts involving deals in India, and Chicago.

Without any capital resources, Stan Caterbone had developed a successful business, focusing on Federal contracts, and has been cited and published for his expertise in digital technologies.DI= ************************************************************ TI=\FULTON BANK EMBEZZLEMENT IM=195P01.CPR DA= August 9, 1990 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 3 SU= SUMMARY: A letter to David C. Hostetter, Executive Vice President of Fulton Bank, from Stan Caterbone demanding the return of $5,000 of Stan Caterbone's monies that were taken from his checking account on June 10, 1990, because an employee had keyed in $6,250.00 instead of the actual amount of $1,250, even though "Twelve Hundred & Fifty Dollars" had been written on the check. After retaining legal council, the monies were returned on or about August 14, 1990. However, interest was not returned. On or about November 23, Stan Caterbone had applied for an auto loan, his previous auto loan with Fulton had only one payment remaining. Dennis Roda, account representative, took the application. Stan Caterbone offered to give a $7,000 Certificate of Deposit along with the title of the auto, valued at $9,000 for a $7,000. The loan was declined and the account representative cited 9 returned checks as a cause for denial. the Fulton Bank had stolen the $5,000 from Stan Caterbone's account.IM=195P02.CPR DI= PAGE 02 IM=195P03.CPR DI= PAGE 03 DI= ************************************************************ TI=\DEPARTMENT OF DEFENSE DMA CONTRACT 700-90-R0011 IM=196P01.CPR DA= September 24, 1990 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 3 SU= SUMMARY: Letter from the Department of Defense' Defense Mapping Agency to Stan Caterbone, of the Advanced Media Group, Ltd., and the CD-ROM Technologies division of American Helix Technology Corporation, a subsidiary of High Industries. Stan Caterbone had submitted a competitive bid for the $2.5 Million Dollar Department of Defense Contract for Digital Technologies Services, particularly the production of CD-ROM discs, containing digitized maps used in military and governmental applications.IM=196P02.CPR DI= PAGE 02 IM=196P03.CPR

DI= PAGE 03 DI= ************************************************************TI=\"AMERICAN HELIX & STAN CATERBONE BUSINESS AGREEMENT"IM=308.CPRDA= November 2, 1990PA= PAGES: 01

SU= SUMMARY: Stan Caterbone had made fruitless attempts to solidify an agreement with American Helix and High Industries in order to receive compensation for the CD-ROM business. Stan Caterbone was conducting business since June, without any compensation or agreements. Finally, on November 2, 1990, the following agreement was signed.

This agreement was breached on January 12, 1991. For no reason or more importantly explanation, Stan Caterbone was again "LOCKED OUT" of his place of business, and his business.

David D. Dering, gave no reason or explanation, other than the implementation of a smear campaign to diminish any respect or credit that Stan Caterbone had developed with clients, and employees, including High Industries. Rumors of and Slanderous remarks were again launched in order to justify the actions of David Dering and James Boyer.DI= ************************************************************ TI=\DISC MAGAZINE COLUMN FORMAT FOR AUTHORS IM=197P01.CPR DA= October 22, 1990 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 3 SU= SUMMARY: A facsimile from Linda Helgerson, publisher of several CD-ROM (Digital Technologies), and considered one of the most influential persons in the CD-ROM Industries, to Stan Caterbone outlining procedures and formats for the submission of technical articles for the new DISC magazine, a technical journal for the CD-ROM industry. Stan Caterbone was selected to submit monthly articles for the Disc Magazine. Stan Caterbone has developed a respectable working relationship with Linda Helgerson. IM=197P02.CPR DI= PAGE 02 IM=197P03.CPR DI= PAGE 03 DI= ************************************************************ TI=\ASSISTANT SECRETARY OF DEFENSE LETTER IM=198P01.CPR DA= October 23, 1990 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: A letter to Congressman Robert Walker from Dave Gribbin, the Assistant Secretary of Defense, Legislative Affairs, regarding the inquiry by Stan Caterbone regarding the procurement procedures concerning the $2.5 Million contract with the Department of Defense, Defense Mapping Agency. The contract was protested by Phillips Dupont

(PDO) after being awarded to SONY (DADC). Stan Caterbone and American Helix was to submit new pricing schedules in order to bid again against SONY and Phillips Dupont. However, Phillips Dupont had received the pricing schedules of the winning bid submitted by SONY, when Phillips Dupont called a debriefing conference immediately after the contract was awarded. However Stan Caterbone was denied access to the pricing information, and was expected to compete again for the contract against SONY and Phillips Dupont, who together developed the CD-ROM Technologies. The Department of Defense information to Stan Caterbone and American Helix. DI= ************************************************ TI=\CONGRESSMEN ROBERT WALKER'S REPORT IM=199P01.CPR DA= October 30, 1990 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: Letter from Congressman Robert Walker to Stan Caterbone and an interim report regarding his grievance concerning the disclosure of the DMA700-90-0011 pricing schedules. DI= ************************************************* TI=\DMA TERMINATION OF SONY CONTRACT AWARD IM=200P01.CPR DA= October 29, 1990 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 2 SU= SUMMARY: Letter to Stan Caterbone from William Nelson, Contracting Officer of the Department of Defense' Defense Mapping Agency outlining the procedures to reopen the DMA700-90-001 CD-ROM contract and the procurement procedures that the offerors, SONY (DADC), Phillips Dupont (DADC), and Stan Caterbone (American Helix). Because of the continued request and political influence of Robert Walker (Chairman of the Space, Science, and Technology) all offerors will all pricing schedules of all eachothers Best and Final Offer. IM=200P02.CPR DI= PAGE 02 DI= ************************************************** TI=\CONGRESSMEN ROBERT WALKER LETTER AND REPORT II IM=201P01.CPR DA= November 8, 1990 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 2 SU= SUMMARY: Letter to Stan Caterbone from Congressman Robert Walker along a letter from Stanley O. Smith, Brigadeier General of the United States Air Force, Chief of Staff, concerning Stan Caterbone's concern regarding procurement procedures for the Department of Defense' Defense Mapping Agency $2.5 Million Contract.

IM=201P02.CPR DI= PAGE 02 DI= ************************************************ TI=\"ESCAPING THE UNIX TAR PIT" ARTICLE BY S. CATERBONE IM=202P01.CPR DA= November 18, 1990 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 9 SU= SUMMARY: A copy of the article written by Stan Caterbone and John Garofolo Computer Scientist of the National Institute of Technology, of Gaithersburg, Maryland submitted for the January issue of DISC magazine. Stan Caterbone had successfully completed development of the most aggressive CD-ROM project for NIST, sponsored by the Defense Advanced Research Projects Agency Information Science and Technology Office (DARPA-ISTO). The project was so difficult, that only Stan Caterbone and Phillips Dupont had competed for the contract. Stan Caterbone was awarded the governmental contract in June of 1990. The project required the production of UNIX TAR files, which are considered unconventional in the CD-ROM industry. The article was written to inform the industry of potential problems that developers and specifically manufactures may encounter. JANUARY "DISC" '91 Magazine Published by: Helgerson Associates Falls Church, VA

"Escaping the UNIX Tar Pit" Producing CD-ROMs in the UNIX Environment

Written by:

Stan J. Caterbone Director of CD-ROM Technologies for American Helix Technology Corporation and Director of Advanced Media Group, Ltd. 1857 Colonial Village Lane Lancaster, PA 17601.

Phone: (800) 525-6575 Fax: (717) 392-7897

John S. Garofolo Computer Scientist National Institute of Standards and Technology Technology Building, Room A-216 Gaithersburg, MD 20899

Phone: (301) 975-3193 Email: john@ssi.ncsl.nist.gov

Just when things are going smoothly, and we begin to feel a little too comfortable and too confident with CD-ROM technology, someone or something puts us in our place -- and

thankfully so. It's these challenges that facilitate our progress toward broadening the horizons of CD-ROM technologies. This article is intended to inform publishers and manufacturers of the problems that can be encountered in using UNIX tar- formatted files as a medium of data submission for CD-ROM production and some of the issues confronting the next generation of CD-ROM publishers.

Databases developed on non-DOS-based systems which have performance requirements that exceed MS-DOS capabilities are becoming more commonplace. Ironically, the existing CD-ROM production infrastructure has been created and supported primarily by DOS-based systems. Although we are making progress in publishing data on other platforms, a large majority of the CD-ROMs published today are still designed on DOS machines for use on DOS machines. The current tendency to link CD-ROM with DOS is making the implementation of CD- ROM technology on non-DOS systems difficult and, therefore, slowing its widespread acceptance.

The ensuing paragraphs illustrate the need for the CD-ROM industry to remove its blinders and address universal problems with universal solutions. CD-ROM technology is beginning to recruit a new breed of both users and publishers, which are hoping that CD-ROM will adapt to them, as opposed to them having to adapt to it. The Automated Speech Recognition Group of the National Institute of Standards and Technology (NIST) is one such CD-ROM publisher.

NIST: AUTOMATED SPEECH RECOGNITION GROUP

The NIST Automated Speech Recognition Group Sponsored by the Defense Advanced Research Projects Agency Information Science and Technology Office (DARPA-ISTO), the group designs and implements methods of performance evaluation for spoken language systems which consist of natural language understanding as well as speech recognition components. Additionally, it distributes databases, or corpora, of speech recordings as standard reference material for the development and evaluation of these systems.

Traditionally, these speech corpora have been recorded and stored in a digital form rather than in an analog audio format. This allows the data to be easily loaded, stored, and manipulated in computers and prevents signal degradation in copies. The speech is digitized at a sampling rate of between 10 and 20 kHz., as opposed to the 44.1 kHz. sampling rate used in CD-audio. Digitizing speech at these sampling frequencies keeps intact the properties of the speech signal that are important for automatic speech recognition while minimizing storage requirements. These corpora typically consist of thousands of discrete utterances which are stored in separate files for ease of computer manipulation.

In the mid 1980's, the NIST began an archival/lending library

for public domain speech corpora. The corpora were originally maintained and distributed on half-inch reel-to-reel digital magnetic computer tapes. Initially, these corpora were small, but as recognition systems became more sophisticated, their appetite for "training" data grew tremendously. By the end of the decade these corpora were each occupying 50 or more 6250 bpi. half-inch magnetic tapes and even larger databases were on the horizon. Managing these colossal databases of speech had become a real problem. Simply storing, copying, and distributing the corpora had become unwieldy. Furthermore, maintaining the integrity of the corpora was even more difficult as tapes were frequently damaged in shipment or by rogue tape drives.

NIST and CD-ROM

By early 1988, the NIST Automated Speech Recognition Group had begun investigating optical disk storage technologies as a means of replacing its failing tape archives. Initially, Write-Once Read-Many (WORM) technology was considered but was found to lack adequate standardization for use as a universal distribution medium. Fortunately, in the Spring of 1988, the ISO-9660 file format standard for CD-ROM was adopted and CD-ROM was chosen by NIST as a new "experimental" medium for distributing speech corpora.

NIST decided that the first corpus to be produced on CD-ROM would be the DARPA "TIMIT" Acoustic-Phonetic Continuous Speech Corpus. Under DARPA sponsorship, TIMIT was jointly designed, recorded, transcribed, and archive by Texas Instruments (TI) , the Massachusetts Institute of Technology (MIT), SRI International, and the National Bureau of Standards (now NIST). The TIMIT corpus was designed to provide speech data for the acquisition of acoustic-phonetic knowledge and for the development and evaluation of automatic speech recognition systems. The corpus contains recordings of 630 speakers from 8 major dialect divisions of American English each speaking 10 phonetically-rich sentences. In addition to standard orthographic (text) transcriptions, TIMIT contains unique time-aligned phonetic transcriptions. NIST felt that TIMIT's unique structure would be of great interest to speech researchers and, therefore, would probably be ideal for widespread publication on CD- ROM. NIST decided to publish two-thirds of the corpus on a "prototype" CD-ROM.

Because of the ISO-9660 restrictions on filename length and format, the two-thirds of the corpus to be placed on CD-ROM was restructured from a flat directory structure with lengthy unique UNIX filenames into a dense 5-level directory hierarchy which reflected the design of the corpus and conformed to ISO- 9660. The resulting directory structure contained 4200 bottom- level subdirectors -- one for each sentence-utterance and 3 files per utterance for a total of 12,600 data files! This new organization required the use of the entire path and filename to uniquely identify a file but was "visually navigable." To date, nearly 300 "TIMIT Prototype" discs have been

distributed to universities and speech research laboratories worldwide. The discs were well received by the speech research community and have been read on PC's, Apple MacIntoshes, various UNIX systems, Next machines and DEC MicroVaxes. The "experiment" had proved to be successful.

To date, NIST has produced four releases of speech corpora on eight discs. Recently, NIST completed production of its most ambitious speech disc so far. The new disc is a complete revision of the TIMIT Prototype disc and contains the speech for the complete 630-speaker corpus as well as all-new time aligned word-boundary transcriptions. The new TIMIT CD-ROM contains 25,200 data files (4 files per utterance) as well as more extensive documentation and software utilities.

After the production of the TIMIT prototype disc, NIST recognized the need to distribute speech corpora in a consistent format. Unfortunately, no standard file format existed for storing and exchanging speech signals. Compounding this problem, almost every speech research laboratory around the world used different hardware and software configurations for speech signal processing and analysis.

A UNIX-Based CD-ROM Preparation Workstation In order to implement a full scale CD-ROM production effort, the Automated Speech Recognition Group built a UNIX-based CD-ROM publishing workstation, which also doubles as a general-purpose speech research system. CD-ROM images are prepared on a Sun Microsystems server system with 32 megabytes of main memory, 3 gigabytes of high-speed magnetic disc storage, a 9-track tape drive, an 8mm tape drive, and of course a CD-ROM drive. The workstation contains two 1.2 gigabyte magnetic disc drives on which entire CD-ROM images can be assembled and simulated.

Each CD-ROM is now organized entirely in the UNIX environment. Many of the standard UNIX utilities and capabilities have proven ideal tools for CD-ROM preparation. Tar files are now submitted for CD-ROM replication on one 8mm tape, instead of 5 or 6 half-inch reel-to-reel tapes. UNIX- based CD-ROM premastering software is planned to be added in the near future to help alleviate some of the complications NIST has experienced in submitting data for replication. By performing ISO-9660 formatting in house, a master stamper image can be submitted to the replication facility -- thus circumventing the problems inherent in downloading tar- formatted files.

NIST has developed strategies to maximize the portability of its CD-ROMs by organizing speech data into a consistent format and providing utilities which can be linked into each laboratory's unique hardware and software systems. To accomplish this, a flexible, object-oriented header structure was developed for the exchange of speech files, especially on CD-ROM. The header is an ASCII-based structure prepended to each speech file and allows an utterance to be uniquely identified (even if the file is

copied from CD-ROM and inadvertently renamed) and describes basic attributes of the speech signal to aid in digital to analog operations. A set of software utilities have been written, "Speech Header Resources" (SPHERE), to provide a low-level interface for importing and manipulating these files. NIST now publishes all speech data in this more consistent format.

A Data Submission Problem

All of the key components for efficient CD-ROM production were in place at NIST, except for a vehicle for data submission. When NIST initially delved into the world of CD-ROM production, it was dismayed to learn that most CD-ROM replication facilities accepted only standard ANSI-labeled or ISO-9660 imaged tapes as transfer media. The small Automated Speech Recognition Group could not justify the expense of purchasing a special-purpose premastering workstation dedicated to creating ISO-9660 tapes. Neither could NIST provide standard ANSI-labelled tapes because the simple structure of ANSI-formatted files would not preserve the extensive directory structure required by the many files typically contained in speech corpora. The UNIX tar Answer?

The tar-formatted tape is the standard medium of data exchange in the UNIX world and NIST had been successfully distributing speech corpora on "tar tapes" for several years. The UNIX tar (Tape Archive) utility was designed to create a portable archive format for UNIX files. The tar program generates a single file (usually on magnetic tape) which contains all of the information necessary for reconstituting directories, files, and UNIX-specific file parameters. What distinguishes the tar utility from most other archive programs is that the archive format it creates is portable across machines and operating systems. The key to the tar format's portability is in its simplicity. Tar does not employ any elaborate compression algorithms when generating an archive. It simply creates a byte- for-byte copy of each file to be archive with a prepended header block. The header block contains the path and name of the file (or directory), the file size, the time of last modification, and UNIX ownership and permission flags. Because the information in the each header block as well as the file itself is byte-encoded, the tar file can be read by any system which can recognize a stream of bytes. Of course, binary executable files are system-specific and cannot usually be implemented on differing systems. But text, source code, and binary data files can be easily exchanged. To date, the tar program has been ported to many operating systems, including MS-DOS and VMS as well as the many variants of UNIX.

Because the tar format is portable and preserves directory hierarchy, and because a tar file can be written to a standard

ANSI-labelled tape or any other storage medium, NIST concluded that tar-formatted ANSI tapes would be the ideal vehicle for providing a CD-ROM-ready file image to a replication plant.

Unfortunately, NIST has found that most replication plants either refuse to accept tar-formatted files as input to their premastering systems or they charge exorbitant "data conversion" fees to load the files. To say the least, the acceptance of tar as an input medium for CD-ROM production has been less than universal by the CD-ROM replication industry. The few replication facilities that have ventured into the "tar pit" with NIST have encountered numerous technical delays and cost- overruns. In theory, the tar-tape to CD-ROM process should be simple. But in reality, it has rarely been straightforward to implement.

Pitfalls in Extracting a CD-ROM Image from a UNIX tar File

Producing a CD-ROM from a 630-megabyte tar tape which contains over 25,000 files can become an exercise in futility. Several problems have occurred during production, some of which are still not completely resolved. Downloading and extracting a CD-ROM image from a tar file can be excruciatingly slow, taking 15 or more machine hours of time for a single disc image. If a tar file is packed with thousands of files, unforseen complications can arise in the extraction process, and diagnosing and troubleshooting all of the subsystems involved can become painful for even the most experienced of engineers and technicians.

Extracting the file structure from a tar file for a CD-ROM such as the new TIMIT disc requires a great deal of time and attention because of the extraordinary number of directories and files. The subsystems involved in the tar extraction process require seamless integration. These include the PC hardware platform and MS-DOS operating system, the premastering system, the device drivers, controller cards, tape back-up systems, and the tar utility. Limitations inherent in the MS-DOS operating system, device drivers, and file structures can result in breakdowns in any one of these subsystems resulting in the loss of hours of man and machine time in the production process. 8mm tape subsystems are especially vulnerable when extracting exceedingly large numbers of files. This is because 8mm tape drives are mechanically suited for streaming operations. They are not as accommodating as 9-track tape drives in the quick stopping and starting movements which become necessary when extracting many thousands of small files or when dealing with a bogged-down file-laden system. The only way to optimize their operation is to load and buffer large blocks of raw data before it is tar-extracted. Subtle problems may also arise when the controller cards of some 8mm tape systems are not entirely compatible with the publishing system being used. These and other unforseen problems can cause a tape drive to abort operations well before completion of the extraction process.

Worse yet, because the tar format does not guarantee that directories and files are stored in any particular order, an entire tar file must be scanned to extract any subset of files contained in it. If the tar-extraction process aborts before the end of the tar file is reached, the entire process must be restarted from the beginning to insure that all files are loaded. These constraints require that special efforts be placed in preparing backup tapes and even second backup tapes during production. This is one area of risk where the insurance is well worth the effort, and is within one's control. Many of the other pitfalls are not as easy to anticipate or avoid. One of the more frustrating problems encountered while downloading the TIMIT tar file was that of the overhead created while extracting the 18,900 small transcription files. To illustrate this point, during the downloading of the 632-megabyte tar file, containing the 25,241 TIMIT files, the process aborted on 650-, 850-, and 1200-megabyte partitions due to insufficient disc space!

On UNIX systems, the physical file block size can be modified when formatting a disk. Although the ISO-9660 standard supports different sector sizes, the individual operating systems used in the premastering process may present problems. For example, MS-DOS 3.31 does not allow any modifications to sector size. Fortunately, MS-DOS 4.0 is more forgiving. The TIMIT tar file contained 18,900 transcription files of under 2Kb each. A premastering system running DOS 3.31 with a 16Kb sector size would require over 300 megabytes of disk storage for these files which actually amount to less than 32 megabytes of data. This results in disk overhead of 1 order of magnitude! However, by switching to DOS 4.0, the sector size can be reduced to as little as 512 bytes. This significantly reduces the overhead being used by the DOS partition. It is therefore important to adjust the sector size to accommodate the size of the database files to be downloaded. To maximize disk usage, the sector size should be set high when premastering a database with a few large textual files. But when a database (such as TIMIT) contains many small files, the sector size should be greatly reduced. Likewise, it is also important to allow for this kind of overhead on the CD-ROM itself. Although CD- ROMs are generally created with a 2Kb sector size, the sector size can be reduced on the ISO-9660 image in the premastering phase to as little as 512 bytes. By decreasing the sector size on the TIMIT ISO-9660 image to 512 bytes, potential disc overhead was reduced by about 32 megabytes.

Finally, a hidden source of potential problems lies within the implementation of the utility used to extract the tar file. There are currently a number of tar utilities that have been written and are in use today. Many of these utilities are very suboptimal in speed and efficiency. The time required for downloading a tar file can become critical when extracting large numbers of files. Therefore, using the right tar implementation is a must.

The Real "Tar Pit" -- Universal Operability

The real problem facing the CD-ROM industry concerning the production of non-DOS-based discs lies not in which utilities or platforms to use, but within the deeper abyss of universal operability. Universal operability encompasses the common methodology of transferring, publishing, and retrieving many different types of data across different platforms, while using different hardware and software systems. Attempting to extract a tar file into a DOS-based premastering system is a perfect example of why universal operability is the next technical challenge for the CD-ROM industry at large. If this issue is continued to be ignored, entire market segments will be left paralyzed because of the inability to publish information from beginning to end without confronting compatibility problems. This bleak scenario could result in the CD-ROM industry losing the acceptance and respect it has worked hard to gain.

The Challenge Ahead

This article has illustrated some of the potential problems which can result when using the UNIX tar format as a data submission medium for CD-ROM replication. More importantly, it has shown that a much greater variety of CD-ROM applications could blossom if the CD-ROM industry embraces a diversification of CD-ROM platforms. The ISO-9660 standard has provided a good basis for the exchange of CD-ROMs across different hardware and software platforms. It is now time for the CD-ROM industry to address and overcome the many obstacles faced by the challenge of universal operability. The increasing need for a standard media and platform-independent format for data submission is just one such obstacle. In the short term, manufacturers of CD-ROM premastering workstations should publish specifications indicating the limitations of their systems. This would allow publishers and replicators of "atypical" CD-ROMs to avoid many of unforseen pitfalls they must now face. In the long term, these premastering systems must be made more robust. This next generation of CD-ROM publishers and users will help CD-ROM technology reach new heights, but they will become far less forgiving as CD-ROM becomes more commonplace. For NIST, the UNIX road to CD-ROM has certainly been "the road less travelled" but with increased support for CD-ROM production in UNIX and other environments, someday CD- ROMs may be produced from a variety of platforms as easily as they are from MS-DOS-based systems today. It is only in this way that the CD-ROM will become the truly universal medium

of data exchange that it was intended to be.

Acknowledgments

The authors wish to thank the following people which have helped them in their quest for solutions to the problems this article has outlined: Joe Bradley and Clayton Summers at Philips and Dupont Optical Co., Dennis Clark formerly of Meridian Data, Inc., Leon Whidbee and Gisele Venczel at Disc Manufacturing, Inc., Lance Buder at Optical Media International, and Tom Brown at Reflective Software.

References Brown, T., "Universal Operability: The Technical Challenge", Disc Magazine, pp. 30-34, October 1990.

Helgerson, L. W., "Universal Operability: The Technical Solution", Disc Magazine, pp. 36-39, October 1990.

Sun Microsystems, Inc., "TAR(5)", Unix Interface Reference Manual (Release 3.0), Section 5 - File Formats, pp. 429-430., January 1983.

IM=202P02.CPR DI= PAGE 2 IM=202P03.CPR DI= PAGE 3 IM=202P04.CPR DI= PAGE 4 IM=202P05.CPR DI= PAGE 5 IM=202P06.CPR DI= PAGE 6 IM=202P07.CPR DI= PAGE 7 IM=202P08.CPR DI= PAGE 9 DI= ************************************************************ TI=\DEPARTMENT OF DEFENSE DMA 700-90-0011 DEFICIENCIES IM=203P01.CPR DA= November 14, 1990 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 2 SU= SUMMARY: Letter to Stan Caterbone from William Nelson, Contracting Officer of the DOD's Defense Mapping Agency requesting the submission of responses to the technical, quality, and or management deficiencies previously submitted in the Request For Proposal (RFP) of the DMA's contract DMA700-90-0011. IM=203P02.CPR DI= PAGE 02 DI= ************************************************************ TI=\RESPONSE TO DEPARTMENT OF DEFENSE DMA DEFICIENCIES

IM=204P01.CPR DA= November 20, 1990 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 3 SU= SUMMARY: Letter to Contracting Officer William M. Nelson of the Defense Mapping Agency from Stan Caterbone outlining his responses to the deficiencies of the DMA $2.5 Million Contract. IM=203P02.CPR DI= PAGE 02 IM=203P02.CPR DI= PAGE 03 DI= ************************************************************ TI=\CONGRESSMEN ROBERT WALKER'S DISCLOSURE IM=205P01.CPR DA= December 6, 1990 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: Letter to Congressman Robert Walker from Stan Caterbone citing his concern that he has not received the pricing schedules of Phillips Dupont and SONY as previously promised, especially considering his submission to the deficiency responses that were filed on November 20, 1990. In addition, he disclosed that he would be raising issues concerning the events of '87 by the following post script --

"P.S. the summer of '87. Unfortunately, this will involve many of your constituents, in fact you may want to inquire to Mrs. Walker regarding our telephone conversation in July of '87. I mean no harm, and appreciate your integrity and support." DI= ************************************************************

TI=\GRIEVANCE LETTER TO DMA CONTRACTING OFFICER NELSONIM=330.CPRDA= December 23, 1990

SU= December 23, 1990

FROM: Stan J. Caterbone, Director, Advanced Media Group, Ltd., Director of CD-ROM Technologies, American Helix Technologies Corporation

TO: Department of Defense Defense Mapping Agency

ATTN: AQAF-S/Mr. William M. Nelson 3200 South Second Street St. Louis, MO 63118-3399

Subject: DMA700-90-0011 Contract

Dear Mr. Nelson:

Enclosed is a copy of a letter mailed to Congressman Robert Walker on December 6, 1990 in regards to the above referenced $2.5 Million Department of Defense Contract. As you can see, I was becoming very impatient and curious as to why I have yet to receive the pricing schedules, as promised in your correspondence of November 14, 1990. Especially in light of the my efforts that solicited the help of Congressman Robert Walker, Dave Gribben, Assistant Secretary of Defense, and Stanley O. Smith, Brigadier General, USAF, Chief of Staff to support my efforts and to provide pressures to keep the procurement "fair" and to preserve my interests as a "Small Business" in competing against SONY and Phillips Dupont.

However, in leu of our conversations on the morning of December 21, 1990, it seems that you continue to do whatever necessary to keep me from being awarded the DMA700-90-0011 CD-ROM contract.

I find it quite suspicious that I leave town on business, and suddenly you require that I submit my Best and Final Offer, within 48 hours, with no prior notice.

In addition, as per our last conversation of November 19th or 20th, you had personally guaranteed me that you would conduct "negotiations" with with all offerors before being required to submit our Best And Final Offers (BAFO).

In addition, I find that my pricing schedules are very close to those submitting by SONY, which you had originally awarded the contract to, only to find a Protest filed by Phillips DuPont the very next day. Subsequently, I also find no pricing schedule for Phillips Dupont.

Most importantly, I find it quite ironic, that the very reason I had to leave town, was to settle some unfinished business with a former Department of Defense Contractor, James Guerin of International Signal & Control. Yes, the same person that was accused of a "Billion Doll Wide Freud" by Amy Zelnick, Agent of the Internal Revenue Service; Ferranti International, PLC.,; and the British Government earlier this year.

Without going in to any details, I was "Blackmailed" by local, state, and federal authorities because I publicly voiced my concerns as to the improprieties with Department of Defense contracts procured by James Guerin, and ISC, in June of 1987, and rightfully so, as a shareholder of record. And if these allegations would have been heard by Ferranti International, the deal that was finally consummated in November of 1987 between ISC and Ferranti, might not have happened.

Consider the financial and economic self serving interests of all those implicated.

I have suffered three years of "HELL", because of the "Blackmail" conspired by James Guerin and the Lancaster Business Community at large, all while I was working on what was to be the first "digital movie" which was to include a joint venture with none other that SONY itself.

I finally restore my life back to some kind of decency, through no support of the same local, state, and federal authorities, to which I pay for their alleged services, but rather my own sweat and tears.

And, what took you 3 years to figure out, I, James Christian, Ferranti International, and the British Government, have suffered and continue to suffer the consequences for your misconduct and corruption.

Consequently, I have produced a CD-ROM which contains over 500 authentic documents and over 30 minutes of recorded audio conversations to substantiate and confirm the above. All on one little shiny silver platter!

And now, after three years, I find myself again playing your "Fucking Games".

In another perspective, I have studied and tried to understand the circumstances and motives of the Persian Gulf Crisis, and more importantly the motives of Saddam Hussain, and quite honestly I don't believe a God Damn thing you say.

In conclusion, after 3 lonely years of "HELL" I have finally formulated an opinion that would seem to make some kind of sense out of this bizarre nightmare:

"CORRUPT SYSTEMS, GOVERNMENTS, AND INSTITUTIONS WILL BREED NOTHING BUT CORRUPT MEN."

Take your God Damn contract and Go To Hell!

Regretfully,

Stanley J. Caterbone Director, Advanced Media Group, Ltd.,

ENCLOSURES

cc:Captain Wright, Defense Mapping Agency

Stanley O. Smith, Brigadier General, USAF, Chief of Staff

Dave Gribben, Assistant Secretary of Defense, Legislative Affairs

Congressman Robert Walker, U.S. Congress

James Christian, Loretto State Prison

Sir Derek Jones, Chairman, Farranti International, PLC.,

Tony Bongiovi, Power Station Studios

Marcia Silen, Flatbush Films

Ted Gamillion, Gamillion Studios

Diane Sawyer, ABC News, PRIME TIME

Betty Scorpa, CBS NEWS, 60 MINUTES

Murray Horton, District Justice

Rufus Fulton, Fulton Bank

Detective Bodan, Pennsylvania State Attorney General's Office

Howard Eissler, Pennsylvania Securities and Exchange Commission

Gibson Armstrong, Pennsylvania State Senator

Detective Larry Mathias, Manhiem Township Police Department

Chuck Smith, Lancaster Aviation, Inc.

Mike Wolfe, Commonwealth National Bank

Lancaster District Attorney, Totaro

Jack Buckwalter, President, Lancaster News Papers, Inc.

Robert Beyer, Attorney

Joseph Roda, Attorney

Robert Kauffman, Premier Financial Group

Craig Russell, Russell, Kraft, Gruber and Huber

Richard Reeser, District JusticeIM=330B.CPRDI= PAGE 02IM=330C.CPRDI= PAGE 3IM=330D.CPRDI= PAGE 4IM=330E.CPRDI= PAGE 5IM=303G.CPRDI= PAGE 6IM=330I.CPRDI= PAGE 7IM=330J.CPRDI= PAGE 8 DI= ************************************************************TI=\LUCASFILM, Ltd., LETTERIM=334.CPRDA= January 24, 1991

AT= AUDIO TRACKS: /ALLPA= PAGES: 1

SU= SUMMARY: Letter from Jeffrey C. Ulin, Associate Director of Legal and Business Affairs concerning information forwarded to George Lucas. DI= ************************************************************

TI=\FMG, Ltd., AND SUBSIDIARIES ARTICLES OF INCORPORATION IM=301P01.CPR DA= June 12, 1986 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 9 SU= SUMMARY: Copies of the Seven (7) corporations that were incorporated with the Commonwealth of Pennsylvania Department of State - Corporation Bureau by Stanley J. Caterbone. Not shown is the Articles of Incorporation for Pro Financial Group, Ltd., which was incorporated in April of 1986, by Stanley J. Caterbone who owned 100% of the outstanding stock. IM=301P02.CPR DI= PAGE 02 IM=301P03.CPR DI= PAGE 03 IM=301P04.CPR DI= PAGE 04 IM=301P05.CPR DI= PAGE 05 IM=301P06.CPR DI= PAGE 06 IM=301P07.CPR DI= PAGE 07 IM=301P08.CPR DI= PAGE 08 IM=301P09.CPR DI= PAGE 09 DI= ************************************************************ TI=\FMG, Ltd., & FMG ADVISORY CONTRACTS IM=302P01.CPR DA= October 17, 1986 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 7 SU= SUMMARY: The contracts for all licensed representatives and all affiliated persons of FMG Advisory, and FMG, Ltd., signed by Stanley J. Catebone. Only the license agreement with FMG Advisory, Inc., was officially executed, which was binded by Stanley J. Caterbone, President and Secretary of FMG, Advisory. The license agreement with Financial Management Group, Ltd., clearly states several key elements, which specifically contradict legal actions taken by Kauffman and Hartlett. Firstly, the contract specifically states that the licensee and licensee have only that such relationship, and in no way shall ever be construed as an employer employee relationship. Secondly, the

contract may only be terminated by formal written notice, submitted with a 30 day notice to the last official address of the licensee, or to Financial Management Group, Ltd., by registered or certified U.S. Mail. IM=302P02.CPR DI= PAGE 02 IM=302P03.CPR DI= PAGE 03 IM=302P04.CPR DI= PAGE 04 IM=302P05.CPR DI= PAGE 05 IM=302P06.CPR DI= PAGE 06 IM=302P07.CPR DI= PAGE 07 DI= ************************************************************ TI=\EDEN PARK ASSOCIATES LEASE AGREEMENT IM=303P01.CPR DA= August 14, 1986 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 4 SU= SUMMARY: Copies of the legally executed lease agreement between the Eden Park Associates II, (Lessor), and Financial Management Group, Ltd., (A Pennsylvania Business Corporation), and Michael M. Hartlett, (Individual); and Stanley J. Caterbone, (Individual);, and Robert K. Kauffman, (Individual). The lease agreement was for a term of Five (5) years, and Kauffman, Hartlett, and Caterbone, had signed binding personal guarantees for over $500,000, until August 14, 1991, the expiration date of the lease. Any modification or amendment required a formal written notice, of which would have been required to be executed by the Secretary of Financial Management Group, Ltd.,, or Stanley J. Caterbone. IM=303P02.CPR DI= PAGE 02 IM=303P03.CPR DI= PAGE 03 IM=303P04.CPR DI= PAGE 04 DI= ************************************************************ TI=\FMG NOTES/CATERBONE-KAUFFMAN OPTION IM=304P01.CPR DA= August 30, 1986 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 1 SU= SUMMARY: Document A is the agreement between Kauffman and Caterbone for an option for Caterbone to buy 10,000 shares of FMG stock from Kauffman on demand at a purchase price of $.50 per share. This agreement was intended to give Caterbone and Kuaffman an equal 50,000 shares of FMG, Ltd., as

agreed upon. However after Kauffman was issued his 60,000, he never executed the agreement. Document B is a Demand Note issued on behalf of FMG, Ltd., to Robert Kauffman, and executed by Robert Kauffman.

This violates two (2) laws of incorporation, firstly the secretary of FMG, Ltd., Stanley J. Caterbone must execute the agreement on behalf of FMG, Ltd., and since it was for the additional 20,000 shares of FMG, Ltd., it violates securities regulations because Kauffman was an Officer and President and cannot borrow corporate funds for the purchase of said securities. Document C is the FMG Advisory, Inc., Stock for his purchase of 10,000 shares of FMG, Ltd., stock. Document DI= ************************************************************ TI=\CATERBONE-KAUFFMAN OPTION AGREEMENT IM=305P01.CPR DA= August 30, 1986 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 2 SU= SUMMARY: Option agreement between Robert Kauffman and Stan Caterbone. IM=305P02.CPR DI= PAGE 02 DI= ************************************************************ TI=\REGISTERED INVESTMENT ADVISOR ADV SUBMISSIONIM=306P01.CPR DA= February 18, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 2 SU= SUMMARY: Copies of form ADV submitted in the application for the registration of FMG Advisory, Inc., as a Registered Investment Advisor with the Pennsylvania Securities and Exchange Commission and the Federal Securities and Exchange Commission. Documents provide the] business background of Kuaffman and Caterbone, which demonstrates that Caterbone was leading Kauffman and not Kuaffman leading Caterbone, as he wanted people to think. IM=306P02.CPR DI= PAGE 02 DI= ************************************************************ TI=\KAUFFMAN CONTRACT WITH FMG, Ltd., IM=307P01.CPR DA= May 21, 1987 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08 PA= PAGES: 2 SU= SUMMARY: In May of 1987, Robert Kauffman approached Stan Caterbone about a new contract with increases in both salary and in profits from certain businesses. Stan Caterbone did not agree with the terms or the conditions of the contract, especially because Robert Kauffman wanted

profits from business activities that Stan Caterbone was directly responsible for building and growing -- mortgage banking, FMG Advisory, Inc., the insurance and the accounting businesses. This is what had initiated the major differences between Stan Caterbone and Robert Kauffman. The total agreement was not legally executed by the Board of Directors, but again by Robert Long, Jr.,. Again Stan Caterbone, Secretary, must execute all legal documents for the corporation. IM=307P02.CPR DI= PAGE 02 DI= ************************************************************ TI=\OLD HICKORY LOAN PROPOSAL BY S. CATERBONE DA= May 25, 1987 PA= PAGES: 3 SU= SUMMARY: The refinancing commitment letter to Norris Boyd, of Boyd Wilson, from Stan Caterbone and Al Dannatt of Institutional Investors for a refinancing of $5,000,000 of an estimated $15,000,000 of debt on the Olde Hickory Properties. Norris Boyd had many other projects that required refinancing. Norris Boyd had told Stan Caterbone that the existing mortgage was currently being serviced by Commonwealth National Bank, and that Commonwealth could not compete with the terms of the deal that Stan Caterbone had proposed. DI= ************************************************************ TI=\FINANCIAL MANAGEMENT BUSINESS PLAN DA= JULY 27, 1986 AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08

DI= ********************************************************* TI=\MOVIE SPLITS DA= MAY 25, 1987 AT= CORRESPONDING AUDIO TRACKS:01/02/03/04/05/06/07/08 SU= Stan and Marcia Marcia 40,000 - 60,000 l% - l-l/2% of 4 million 2%-l/2% Gross Profits 5% of back net profits Credits - Film and marketing consultant to producer Stan 200,000 5% of 4 million 7-l/2% Gross Profits l5% of investors back end Credits - Stan Executive Producer with Tony Bongiovi Shares with Scott Robertson Without Debt Stan will record 1.2 million of first revenues - 300,000 to go to Marcia. That leaves 2.5 million to Power Station to be used for video studio No Debt!!

Out of l.2 million Bob Long 150,000 Scott Robertson 300,000 Stan Caterbone 750,000 DI= *********************************************************** TI=\MORTGAGE BANKING LETTER DA= MAY 20, 1987 AT= CORRESPONDING AUDIO TRACKS:01/02/03/04/05/06/07/08

SU= May 20, 1987 Mr. Richard Anderson 37 Main Street Clinton, NJ 08809 Dear Dick: I would like to thank you for your time that you have afforded Al Danntt of Institutional Investors. We have arranged Al to direct all of our mortgage banking services and real estate development services as pertaining to borrowers, buyers and sellers. As you can see, FMG, Ltd., provides an array of services to the real estate players all over the country and even internationally. These services are tailor made to meet the needs of our clients. We do not and will not standardize or try to provide discount services. -- We will provide the best services available, always at a reasonable price. Our only objective is to improve the financial status of our clients in all areas; equity, cash flow and long term growth. Because of the wide array of services available and the time elements involved with the velocity of current market conditions, we must assume that I must know as much about you and your firm so that I can save both of us something very valuable - Time and Money. I will determine how we can effectively service your firm from the information that you will be asked to provide. I must have a complete file so that when I come across opportunities that may be useful and profitable to you, I don't have to spend weeks or months trying to communicate with you to determine the merits of such opportunities. One of the basic elements and philosophies of FMG, Ltd., is convenience and automation, which both result in saving time and money. Please provide the following: l. A current Business Plan or Resume of your firm and which business it specializes in.

2. List of owners and key people - detailing their respective responsibilities.

3. Real Estate Portfolio a. Value, description, debt 4. Loan Portfolio a. Description b. Value, terms 5. What your priorities are for FMG, Ltd., to provide you with. I realize that the above will not be an easy task, however, I guarantee you that it will greatly enhance our relationship and will return the time to both of us many times over. I will have myself or one of my associates follow up on your progress. Thank you for your time and I look forward to working with you! Respectfully yours, Stanley J. Caterbone Executive Vice-President FMG Ltd. SJC:lmk cc: S. Robertson B. Long A. Dannatt DI= *********************************************************** TI=\David R. Schadd Letter DA= May 11, 1987 AT= CORRESPONDING AUDIO TRACKS:01/02/03/04/05/06/07/08 SU= May 11, 1987 David R. Schod, President Bennett Williams, Inc. 30 East King Street Post Office Box 1364 York, PA 17405 Dear Dave: Enclosed is a proposal for your syndication. Please go over its contents and when you are finished reviewing, we should get together to discuss the project in person. I will be away until the 18th of May.

I look forward to hearing from you. Sincerely, Stanley J. Caterbone President

SJC:lmk cc: file Robert J. Behler, Jr. DI= *********************************************************** TI=\BENNET WILLIAMS SYNDICATION DA= June 15, 1987 AT= CORRESPONDING AUDIO TRACKS:01/02/03/04/05/06/07/08 SU= BENNETT WILLIAMS/SYNDICATION I. Scope of Business II. Services and functions of FMG, Ltd. FMG I and Bennett Williams III. Structure of Syndication IV. Costs of Syndication - Bennett Williams Financial Center V. Financial Service Center I. SCOPE OF BUSINESS The following is a proposal to Bennett Williams, Inc. to provide the syndication and marketing of the l.5 million office building to be constructed in downtown York, PA. This proposal is an attempt to describe the role and function of FMG, Ltd (Syndication) along with the relationships of Bennett Williams, Inc. (General Partners) and FMG I (Limited Partners). This proposal is a result of a meeting of Dave Schad, Bob Behler of Bennett Williams and Robert Kauffman, Stanley Caterbone and Scott Robertson of FMG, Ltd. The purpose of the project is to raise the necessary capital approximately l.5 million (excluding syndication fees) and to manage the partnership through its entirety until it is dissolved. As per previous conversations, the building will be funded completely from partnership proceeds without using debt, which will provide a steady stream of income, projected to be between 9% - 12% with the possibility of refinancing the project around the seventh year in order to return the original capital back to the investors. FMG will also consider developing a Financial Service Center, similar to that which exists in Lancaster. While Bennett Williams will be the major tenant and responsible for the lease up, FMG will consider also aiding in that process through expansion of their business to York. II. FUNCTION OF BENNETT WILLIAMS - THE GENERAL PARTNER (G.P.) The General Partner (GP) will be responsible for the following:

a). Development - The G.P. will be responsible for all development involved in the project. b). Construction - The G.P. will be responsible for all construction phases associated with the project. c). Leasing - All leasing responsibilities will be of the G.P. The G.P. will have the task of obtaining 100% occupancy of the building in a reasonable and timely fashion. The G.P. will also be responsible for determining the fair market value of the space and for attracting attractive tenants with favorable leasing agreements to maintain a favorable and healthy cash flow. d). Management - The G.P. will be responsible for the management of both tenants and the building in order to obtain maximum income and future appreciation given favorable economic conditions. II. FUNCTION OF FMG, LTD. - THE SYNDICATOR FMG, Ltd. will be responsible for the following services and factors: a). The Syndicator will be responsible for all legal and accounting services needed to register the partnership with the appropriate regulatory authorities in order to solicit investors. b). Prospectus - The Syndicator will be responsible for the development and production of the prospectus to be used to solicit investors. c). Marketing - The Syndicator will be responsible for the marketing and solicitation of investors in order to raise the necessary capital to finance the project. d). Distribution of Proceeds - The Syndicator will be responsible for accounting and reporting functions necessary to provide investors with the progress and performance of the Partnership. The Syndicator will be responsible for the reporting regulations of the Internal Revenue Service for both Investors and the G.P. The Syndicator will also be responsible for the distribution of proceeds both during operation and upon sale or refinancing of the project. II. FUNCTION OF FMG I - THE LIMITED PARTNERSHIP The Limited Partner will be responsible for providing the necessary capital of approximately l.75 million dollars.

III. STRUCTURE OF PARTNERSHIP The following is a description of the structure of the partnership. The Partnership will be registered by the Securities and Exchange Commission as a Private Placement Regulation D, Rule 144 Offering. This will limit the number of unaccredited investors to 35. Bennet Williams Inc. - General Partner Equity: 20% of Partnership sale distributions Income: 20% of Net cash flow distributions FMG, Ltd. - Marketing Fees Equity: 5% of Partnership sale proceeds. Income: 5% of Net cash flow distributions Limited Partners Equity: 75% Income: 85% of Net Proceeds Load: 88% of cash goes into actual development Marketer/G.P. 90/l0 of cash flow until Limited Partnership

10% cash on cash return and 75/25 if that condition is met This would enhance marketing because of G.P. incentive to perform for investors. IV. COST AND FEES FMG, Ltd. will receive approximately 8% of the capital raised in order to perform the necessary services associated with the project. This includes all legal, accounting and marketing fees needed. Bennett-Williams will receive a 3% G.P. development fee for putting the project together (building design, construction supervision...etc.). Hibbard Brown will receive a 1% syndication fee for registration and preparation of financial disclosure documents for the partnership. This means approximately 88% of the capital raised will go into the actual building and ground. This includes all legal, accounting, printing, marketing, of the partnership. With this ratio, the program will be among the most marketable anywhere in the country. FINANCIAL SERVICE CENTER Financial Management, Group, LTD. will attempt to develop a Financial Service Center similar to the Lancaster Office in the building being syndicated. FMG has developed a Full Service Financial Center That provides all of the relative services necessary to manage the financial affairs of individuals, businesses and institutions. The Center will include the following services: l. Financial Planning

2. Investment and Portfolio Management 3. Accounting and Tax Preparation 4. Real Estate Services 5. Legal Services 6. Insurance Services 7. Investment and Mortgage Banking Financial Management Group, LTD will structure the Center similar to that of the Lancaster location with the exception that Bennett Williams will have a role in the formation and the operations of the Center. FMG will provide the recruiting and management of the operation and will use the current systems that have been developed and used in Lancaster. The ownership will be structured among FMG, Bennett Williams, and the other Major Players who wish to get involved. Enclosed is an original Business Plan that outlines the concept in more detail. DI= ***********************************************************

TI=\ABC 20/20 BROADCAST: "MADE IN THE USA?" DA= February 1, 1991 AT= AUDIO CONVERSATIONS: 02/05/07/09

SU= <HUGH DOWNS>: In Gulf war military briefings, allied commanders love to showcase the performance of sophisticated U.S. weaponry. Everything from smart bombs to Patriot missiles have bolstered the allies' performance, but 20/20 has learned that federal investigators are inquiring now whether Iraq itself may have of a U. S.-style technology. It's feared that cluster bombs of a type originally designed and produced in this country, may be used against American forces. Tonight, in a 20/20 investigation, Lynn Sherr asked whether and how Saddam Hussein got his hands on technology "Made in the USA."

<LYNN SHERR, ABC News>: These aircraft are delivering some of the deadliest conventional weapons ever built. They are called "cluster bombs" and the earliest version was used by the American military in Vietnam. They are so vicious that when Israel used them against civilians in Lebanon in 1982, it created a serious rift of in relations with the United States. The bombs have been sold to many countries considered friends of the United States, but now the technology and the bombs themselves are also in the hands of Saddam Hussein. ABC News defense consultant Anthony Cordesman.

<ANTHONY CORDESMAN, Defense Analyst>: By and large, they can be 10., sometimes 100 times more lethal in killing exposed targets than a conventional, very large high-explosive weapon.

<SHERR>: This is the story of how this deadly weapon designed for the U.S. military made its way from this country to Iraq and how America soldiers may now face the devastation from thousands of cluster bombs if a ground war breaks out in the PersiAn Gulf. Federal officials believe Saddam Hussein got his arsenal through a lethal combination-- bureaucratic foul-ups in the U.S. government and simple greed.

Her's how the cluster bombs work. An artillery, an airplane or a

rocket-launchers And the bombs toward their targets. Each bomb carries hundreds of smaller bomblets, something like hand grenades. Cluster bombs be used against ground troops or tanks and can even scatter mines to lie dormant for days. The shrapnel can rip through the bodies of anyone or anything in its way, causing massive casualties among destruction in these buildings in Lebanon after a cluster bomb attack. How did Iraq obtain the cluster bombs and the technology to make their own? It was incredibly simple. Investigators believe it began with International Signal & Control, a government contractor with 5,000 employees based in Pennsylvania which designed key components of clusters and built them through a subsidiary in California. 20/20 has learned federal investigators believe ISC provided the technology -- that is the plans for the cluster bomb to this man, Carlos Cardoen, a Chilean arms dealer. Authorities think he used the plans to build the cluster bombs in Chile. Then he shipped them to Iraq.

What's wrong with all this? If the cluster bomb technology actually left the county, that is illegal without U.S. government permission, which investigators say ISC never got. It is also illegal for a foreigner like Cardoen to take sub plans out of the United States without a license, which sources tell us he never obtained.

The man who opened the door to Iraq for Cardoens operation was this man, Nasser Beydoun. He is a Lebanese-born middle man for Cardoen who is based in the United States. Beydoun traveled frequently to Baghdad and arranged for the sale of cluster bombs and other military hardware to Saddam Hussein's army. In this first television interview, he told us about the business of dealing in deadly weapons.

<NASSER BEYDOUN, Arms Dealer>: I can sell you a knife to peel an apple. If you cut somebody's throat with it, it's your business. Weapons do not kill. Who is behind it kill. <SHERR>: With slick promotional videos, Cardoen marketed his arms throughout the world, but Arab countries were most favored.

<VIDEO ANNOUNCER>: Each one of the bomblets of the cluster bomb is multi-purpose and has an incendiary, anti-personnel and anti-armor effect.

<SHERR>: This letter from Cardoen authorized Beydoun to sell cluster bombs to Saddam Hussein during his war with Iran. It says Cardoen's company is "willing to take its share in helping Iraq in this time of need. We can provide you with our cluster bombs at the lowest possible price."

According to these contacts, the sale of cluster bombs to Iraq was an extremely lucrative business. February 24., 1984-- 3,000 cluster bombs sent to Saddam Hussein's army, worth $21 million. A few months later, another 3,000 bombs, another $21 million. The supplies of cluster bombs eventually totalled more than $400 million. In fact, Beydoun is suing his former boss for commission payments.

According to Beydoun, Cardoen not only sold the bombs produced in Chile to Saddamm Hussein, he even set up a factory near Baghdad so the Iraqi president could mass-produce his own cluster bombs. That was one of the

first targets of the American military when the attack against Iraq began, but it's unknown whether the plant is totally out of commission.

<MR. BEYDOUN>: He set up a factory for manufacturing of the cluster bomb and later a stage for the fuses and this is a complete project. I mean, it's complete form the raw material to the finished product because the strategy of Iraq is to have control over the weaponry that they have put in their strategy.

<SHERR>: Federal investigators are trying now to bring Carlos Cardoen to trial, but why didn't they find out about him sooner? He's been selling cluster bombs to Iraq for nearly a decade. The U.S. Patent Office knew about Cardoen back in 1986, but they apparently didn't tell anyone else in the federal government about him.

In a move that apparently went unchecked at the tip levies of the U.S. government, Cardoen applied for his own U.S. patent on cluster bombs in 1986. Based on some changes over previous designs, he received the patent two years later. Getting the patent is not illegal, but at a time when U.S. shipments of arms to Cardoen's home country of Chile were banned, as were all sales to Iraq, why didn't the Patent Office raise any questions about this foreigner dealing in U.S.-style arms? Experts say bureaucratic infighting regularly causes such lapses. The Department of Commerce, State and Defense are supposed to control arms sales an communicate with one another.

<MR. CORDESMAN>: Even today, the same squabbling goes on every day between Commerce, State, and Defense and at the same time, the administration can never agree on what kinds of laws can be passed to correct this.

<SHERR>: Carlos Cardeon declined a 20/20 request to speak on camera. In an interview last year, he declined he had done anything wrong.

<CARLOS CARDOEN, Arms Dealer>: And as long as a human being is a person that -- is an animal that needs to defend himself, weapons are going to exist. I think that that is wrong. As a human being, I believe that weapons are wrong, but they are a fact and we have to live with the facts. <SHERR>: The former head of ISC, James Guerin, who dealt with the Chilean, said he did not provide anything to Cardoen to build weapons, but Nasser Beydoun tells another story.

<MR. BEYDOUN>: I believe that Dr. Carlos Cardeon got the technology of the cluster bomb from the Untied States.

<SHERR>: Questions about the cluster bombs come at a time when attention is being focused on how many American-designed weapons ended up in the hands of Saddam Hussein. Senator John McCain.

<SEN. JOHN McCAIN, (R) Arizona>: They're's not just one Saddam Hussein on this globe, there's lots and lots of them who, as we speak, are attempting to acquire the technology to give them this capability of weapons of mass destruction because its a way to gain victory on the cheap.

<SHERR>: McCain has introduced legislation that would severely penalize any any companies or countries that sell weapons illegally, or harbor arms dealers.

<SEN. McCAIN>: But to provide the kinds of weapons that we have to many nations throughout the world, which are clearly offensive in nature clearly fare exceed their requirments to defend themselves, is frankly unconscionable and must be brought to a stop.

<SHERR>: Basically, what you're saying is, "Hit them in the pocketbook."

<SEN. McCAIN>: Hit them in the pocketbook and public exposure. No Corporation or nation like to be branded a nation that is involved in illicit traffic.

<SHERR>: But Public pressure and economic sanctions will not shield American soldiers if Saddam Hussein uses the cluster bombs he already has.

<SEN. McCAIN>: And if there is one good thing that may have come out of this Persian Gulf was, it is to dramatically heighten the awareness of the people of the world and the American people of how dangerous this proliferation of weapons of mass destruction can be.

<DOWNS>: God, those things are vicious. Have there been any indictments yet, Lynn, on this?

<SHERR>: No, Hugh, no indictments yet. Carlos Cardoen has not been indicted, even though federal agents raided his headquarters office in Miami and U.S. Customs agents took a number of documents, but-- no indictments yet, but there are investigations that are going on.

<DOWNS>: If these things are dropped from airplanes and we have air supremacy, as has now been said by our leader, is there much to worry about for our troops?

<SHERR>: We're told yes, because you don't need an airplane to drop a cluster bomb. They can also be used on rocket-launchers and on unguided missiles, both of which Iraq has. And incidentally, we talked about that bomb factory. Even if it was badly damaged -- the cluster bomb factory that he already has -- we're told that in three to six months it can be operation again and anyway, he likely has a big stockpile.

<DOWNS>: We, of course, have these weapons also, but I don't understand, that's called by something different.

<SHERR>: Yeah. If you're listening to a Pentagon briefing, don't listen for the term "cluster bombs". They're calling them "area denial weapons"

<DOWNS>: Thank you, Lynn.

<WALTERS>: Well, next, preparing American pilots for air combat aver Iraq. Stone Phillips went to a Nevada Air Force Base-- dress rehearsals for actual battle conditions. [COMMERCIAL] DI= ************************************************************

TI=\CD-AUDIO MASTER CUE SHEET AND SPECIFICATIONSIM=SMPT1.CPRDA= February 12, 1991PA= PAGES: 02SU= SCRIPT MASTER TAPE CUE SHEET

DATE: 10/12/91 TITLE: 1987 RECORDED AUDIO CONVERSATIONS "SELECTIVE CONVERSATIONS"

CD-ROM TRACK TITLE DATE PERSONS BEGIN/END TIME _______________________________________________________________________

1 PA SEC I 09/29/87 Howard Eissler 0000/0792 1 11 min ISC ALLEGATIONS Bill Johnson 0-16-01 11-51-40 Robert Byers Stan Caterbone

2 Sandra Gray 02/24/88 Sandra Gray 0793/1230 9.5 min Stan Caterbone 11-51-58 20-14-00

3 Lanc. Aviation 07/10/87 Chuck Smith 1236/1467 3 5 min Stan Caterbone 20-14-08 25-11-06

4 Dave Drubner 07/07/87 Dave Drubner 1470/1581 4 2.5 min Stan Caterbone 25-11-10 27-43-26

5 Avalon Police 08/27/87 Avalon Police 1582/1960 23 min Stan Caterbone 27-43-32 52-56-03

6 Gamillion 07/21/87 Ted Gamillion 0435B/0671B 4 min Studios, Inc. Stan Caterbone 52-26-15 56-57-00 Marcia Silen

7 Family 07/26/87 Stan Caterbone 1967 End A Steve Caterbone Phil Caterbone Mike Caterbone Tom Caterbone

8 Robertson 07/12/87 Scott Robertson 0000B/0434B Stan Caterbone

9 Power 07/16/87 Bob Walters 0672B/0940B 5 min Station Studios Stan Caterbone 56-57-10 61-01-10

10 PA SEC II 10/28/87 Howard Eissler 0942B/1041B 3 min Stan Caterbone 61-53-10 64-48-10

11 PA ATTORNEY 10/28/87 Detective Bodan 1093B/1262B 4 min GENERAL OFFICE Stan Caterbone 64-50-10 68-18-10

12 NBC EXPOSE 01/21/91 Tom Brokow 11 min "CORDEON ILLEGAL ARM SALES"

13 ABC 20/20 02/01/91 Barbara Walters 11 min "MADE IN THE USA" Lynn Sherr ISC FEATURE STORY Hugh Downs

TOTAL TIME OF AUDIO ON CD-ROM 38 MIN

IM=SMPT2.CPRDI= PAGE 2DI= ************************************************************

TI=\STAN J. CATERBONE INVESTMENT PORTFOLIOIM=PORT2.CPRDA= February 12, 1990PA= PAGES: 02SU= STAN J. CATERBONE INVESTMENT PORTFOLIO (AS OF JULY 1, 1987)

DATE ESTIMATED PRESENT ASSET OWNERSHIP LOST VALUE VALUE '91

2323 New Danville Pk. Michael and Stan J. 07/01/87 $140,000 $212,630.00 Lancaster, PA 17547 Caterbone

433 West Marion Street Stanley J. Caterbone 07/01/87 $56,000 $85,052 Lancaster, PA 17603

50,000 Shares of Stanley J. Caterbone 07/01/87 $500,000 $759,394 Financial Management

Mortgage Banking Stanley J. Caterbone 07/01/87 N/A N/A Activities

"MUTANT MANIA" Stanley J. Caterbone 07/01/87 $4,000,000 $6,751,000 Digital Movie & Tony Bongiovi

Navaho "CHIEFTAIN" Stanley J. Caterbone 07/01/87 $121,000 $173,123 Airplane

554 Berkley Road Stanley J. Caterbone 09/03/87 $350,000 $500,769 Stone Harbor, NJ 08742

______________________ _____________________ __________ ___________ ___________

TOTALS $490,000 $5,317,000 $9,381,338

IM=PORT.CPRDI= PAGE 02DI= ************************************************************

TI=\STAN CATERBONE NOTES OF NEGOTIATIONS WITH AMERICAN HELIX & HIGH, INC.DA= April, 1990 to February 1991

SU= Legend: David D. Dering - President, Board of Directors, American Helix

Allon Lefever - Chairman of the Board, American Helix Executive Vice President, High Industries

Jim Tritch - Board of Directors, American Helix Executive Vice President, High Industries

<April, 1990: American Helix Board of Directors>

Board of Directors vote to discontinue funding of the CD-ROM business due to financial losses attributed to the LASERTEX joint venture activities, and the business at large. Losses estimated at more than $600,000, not including periphial business losses. Board of Directors also ask for the resignation of Scott Robertson, principal, and vice president responsible for the CD-ROM business and the founder of the LASERTEX joint venture deal.

Decision to discontinue the current consulting contract of Stan Caterbone as a result of discontinuing any capitalization of the CD-ROM business. DI= ***********************

SU= <July 8, 1990: Dave Dering with Stan Caterbone>

Dave requests my business outline of how American Helix and the Advanced Media Group, Ltd., are going to share revenues and structure business agreement.DI= ***********************

SU= <July 12, 1990: Allon Lefever with Stan Caterbone>

Allon stopped in to Helix to see me. Asked if this is my office. Asked who's phone line I was using for long distance calls. Asked me how many days I used the office. I said that I was down in my Washington, D.C. office for one or two days a week. He thought I should be making more of a separation between the Advanced Media Group, Ltd., and American Helix. He was worried about High's liability and exposure of my CD-ROM business activates. I showed him the $2.5 million Department of Defense Proposal for CD-ROM manufacturing -- He showed no response or words of encouragement.DI= **********************

SU= <July 13, 1990: Dave Dering with Stan Caterbone>

Submit business structure to Dave Dering. No response for over a week. I confronted him to confirm the structure, He said he saw no real problems -- He thought the Mastering pass through should provide Helix with revenue for verifying stamper. I told him it was up to him to respond ---- Again no response.DI= **********************

SU= <July 24, 1990: Allon Lefever with Stan Caterbone> Day of American Helix Board of Directors Meeting. Allon Lefever drops of a lead from the curriculum of Bloomsburg State College. Allon also asks "Any CD-ROM business?"DI= **********************

SU= <July 27th, 1990: Dave Dering with Stan Caterbone>

Defense Mapping Agency, Department of Defense, requests production capacity for DMA700-900-0011 contract. Dave Dering states the capacity to be 300 titles per month. I suggested that we make a more conservative approach of 250 titles per month. Dave agree.DI= *********************

SU= <August 10, 1990: Stan Caterbone with Allon Lefever>

Dave Dering was out of town. Allon stopped in to see me. Brought up the issue of stationary. Allon wanted the Advanced Media Group, Ltd., on separate stationary. "That's why we gave you the business", said Allon Lefever. I was instructed to use American Helix stationary for replication business only. I agreed.DI= **********************

SU= <August 14, 1990: Interoffice mail to Allon Lefever>

I forwarded a first draft of Advanced Media Group, Ltd., to Allon Lefever via other materials by Sherri Diebler.DI= **********************

SU= <August 16, 1990: Dave Dering with Stan Caterbone>

Dave Dering was upset that I forwarded a draft of the stationary for the Advanced Media Group, Ltd., to Allon Lefever. Dave said "Don't keep Allon in the loop. I am trying to get him out of the information loop as much as possible."DI= **********************

SU= <August 17, 1990: Stan Caterbone with Allon Lefever>

Allon stopped in my office to say that he liked the stationary.DI= **********************

SU= <August 21, 1990: Stan Caterbone with Dave Dering>

Defense Mapping Agency submits new production requirements of 1,000 titles per year and 250 titles per month during peak times. I asked Dave if we could accommodate the requirement. Dave said to check with Disc Manufacturing, Inc.. (DMI). Wan Seegmiller of DMI

commits to requirments for mastering -- he said Huntsville, Alabama facility would be tooled up for CD-ROM in September. DMI commits to subcontract the mastering as per the production requirments. I responded to the Defense Mapping Agency (DMA) with a commitment for the production requirements.DI= **********************

SU= <August 29, 1990: Stan Caterbone with Dave Dering>

I received notice from the DMA for a Best and Final Offer (BAFO). I asked Dave Dering to meet with me to verify final pricing schedule. Dave Dering said tomorrow with some reluctance.DI= **********************

SU= <August 30, 1990: Stan Caterbone with Dave Dering> Dave Dering reviews pricing schedule and told me that I could go $ .04 lower on all replication line items. Dave asked me how we are going to structure business if we were awarded contract. I suggested that this issue is an example of why we need to finalize a business agreement between American Helix and the Advanced Media Group, Ltd.,. I suggested that the Advanced Media Group, Ltd., be responsible for the front end of production (premastering & mastering) and American Helix handle the back end (replication, printing, packaging, and shipping).

American Helix would contract with the Advanced Media Group, Ltd., for the front end at the pricing schedules submitted. Advanced Media Group would subcontract to DMI for mastering.

Dave Dering thought this was a good idea, and agreed. There were no other negotiations between the Advanced Media Group and American Helix concerning the $ 2.5 million DMA contract.DI= **********************

SU= <September 12, 1990: Stan Caterbone with Dave Dering>

Dave Dering asked me to work out an agreement for Allon Lefever to approve between Stan Caterbone and/or Advanced Media Group and American Helix.DI= **********************

SU= <September 18, 1990: Stan Caterbone with Dave Dering>

I submit a draft of the agreement to Dave Dering.DI= **********************

SU= <September 24, 1990: Stan Caterbone with Dave Dering>

Dave Dering still will not resolve contract and agreement issue. Dave continues to put off any resolutions.

<October 19, 1990: Stan Caterbone with Dave Dering>

I again plead with Dave Dering to at least compensate me for business to date, until an agreement can be reached. Dave Dering said that he would submit an invoice to Allon Lefever and discuss payment.DI= **********************

SU= <October 22, 1990: Stan Caterbone with Dave Dering>

I submit an invoice for $407.00 to Dave Dering.DI= **********************

SU= <October 25, 1990: Stan Caterbone with Dave Dering> I notify Dave Dering that if I do not receive a check on Friday, that I want a meeting with Allon Lefever on Monday. I refuse to continue to work on all CD-ROM replication projects without being compensated. I tell him "I'll walk if I don't get paid". He tells me that "there is always the possibility that the check may not get through the system by Friday" I said "in over 18 months of receiving weekly checks as a professional consultant, I never have experienced having a check request take two weeks for processing".DI= **********************

SU= <October 26, 1990: Stan Caterbone with Dave Dering> FRIDAY - NO CHECK AS PROMISED. Dave Dering said that he was having a meeting with Allon Lefever on Wednesday @ 3:30 pm.DI= **********************

SU= <November 2, 1990: Stan Caterbone with Dave Dering>

Business Agreement between Stan J. Caterbone and American Helix is finally settled after 4 months of avoidance by American Helix, and without any compensation paid to Stan J. Caterbone. In addition Stan Caterbone had provided over 50 hours of service maintaining and administering the computer networking system and other periphial hardware devices without any compensation then or in the future.DI= **********************

SU= <January 19, 1991: Stan Caterbone, Al Thornburg, with Dave Dering>

On Saturday morning, I went to the American Helix facility to pick up some computer hardware. Upon attempting to unlock the side door entrance with my 24 hour access security card, the door would not unlock. Assuming something may have been wrong with the security system, I drove to the residence of Al Thornburg, the engineer for American Helix. I asked Al to drive over to see if his access card was operable.

We entered the building with Al's access card and found that my access card was inoperable throughout the building. Al then said that "Stan, your locked out". I said, "I was in here until 5:00pm last evening and my access card worked fine. I proceeded to pick up the tape back-up and said "Let's go. I don't want to be arrested for burglary, like I was 3 years ago. I don't know what the Hell is going on".

As we were leaving the computer room, Dave Dering appeared. This was quite unusual, since myself and Al Thornburg often work on Saturdays, and Dave Dering has not been in the plant on a Saturday for the past few months. I said to Dave "Dave, why am I locked out?" He said

"talk to Jim Boyer". I, quite emphatically said, "why am I locked out?". "Stan, you'll have to talk to Jim". I said "Dave, you are the president, my contract is with you, not Jim Boyer". Dave said "Now, Stan, just calm down. This isn't a conspiracy against Stan Caterbone." I told Al that I'm getting out of here. This is too much like 3 years ago. I didn't do anything, and I can't understand what is going on.

We left the building, and Al was especially suspicious of the events and especially why suddenly Dave Dering showed up at the building on that particular Saturday, only moments after we arrived at the building.DI= **********************

SU= <January 21, 1991: Stan Caterbone Fax to David D. Dering>

Afraid of the "LOCKOUT" and the lack of any events or activities that would explain such a drastic and damaging action of American Helix, I faxed a letter to Dave Dering citing him in breach of our business agreement and in conspiracy to eliminate or sabotage my business and my reputation. The fax also contained a cc: to High executives, that was never sent.DI= **********************

SU= <January 22, 1991: Phone conversation; Stan Caterbone and Dave Dering. Dave Dering "Stan, how did you get in here last night?".

Stan "Dave, what are you talking about?, I won't go near that building, the last time I went back into my own building after being illegally locked out, I end up in jail".

Dave Dering " How did you get in here and steal your fax?".

Stan "Dave, why would I want to steal the fax that I wrote?" Dave Dering "You have caused a big problem. You put me in a difficult position -- I don't know if I can rectify things with the 'High's' and especially Allon Lefever. I always went to bat for you -- how do I trust you?".

A meeting was set up for 6:00pm later that day.DI= **********************

SU= <January 22, 1991: Stan Caterbone with Dave Dering>

Dave gave three (3) reasons for the "LOCKOUT", although never willing to engage in any real conversations relating to those issues:

1. The computer system went down, causing a problem in the security system.

2. Jim Boyer did not reinstall my access identification number for the security system.

3. Jim Boyer was to talk to you on Friday, the day before the lockout, concerning eliminating your access to the facility.

Dave said "Jim Boyer said that he can take over the CD-ROM business

-- no problem".

Dave talked about trust and who to trust. Dave reluctantly agreed to continue our relationship, however only on an arms length basis. I was no longer allowed in the building except during normal business hours. I was no longer to have a private office. Dave Dering never addressed the issues or the circumstances that preceded the "LOCKOUT", and never addressed the reasons as to why there was any reason to modify the agreement concerning my business American Helix that was established back in June of 1990. There were no disputes, activities, or conversations that gave any indication that American Helix, Dave Dering, or Jim Boyer intended to change or modify our relationship.DI= **********************

SU= <January 24, 1991: Stan Caterbone with Allon Lefever>

Stan Caterbone called a meeting Allon Lefever to discuss the following: 1. The R.R. Donnelly merger and acquisition of American Helix. 2. The "LOCKOUT".

Allon asked questions regarding my contact with R.R. Donnelly and Barry Glick. I quickly made it clear that Barry Glick contacted me in December after seeing my advertisement in the CD-ROM Enduser magazine, published by Linda Helgerson. Barry was elated to see someone in the local area that was involved with CD-ROM technologies and asked to visit with me. Allon asked many questions about Donnelly and Barry Glick. I made it clear that during our visit, and from the discussions regarding the strategic plan of Donnelly, I suggested that there may be an opportunity for a merger or acquisition with American Helix. I also discussed the capabilities for the facility to be a dedicated CD-ROM manufacturing facility. I notified Allon that Barry was awaiting a call from the next day concerning the appropriate contact to discuss the subject of an acquisition. Allon assured me that the High's would not contact Donnelly directly and would await a call from Barry Glick.

Regarding the "LOCKOUT" I gave the three reasons that Dave Dering had provided during our meeting a few days before. I told Allon that after "I had built a strong foundation for the CD-ROM business -- everybody suddenly wants it back, six months ago, nobody wanted anything to do with it, not to mention the capital that I had invested in it".

Allon Lefever was only concerned with why I had sent the Fax. "Why did you send the Fax? I just don't understand why you sent the Fax". Allon was not concerned with or wanted to discuss the issue of why I was "LOCKED OUT".

Allon asked me the problems surrounding American Helix and what solutions I thought could help restore the company to stability. I discussed the lack of systems, the lack of a strong business foundation, and most importantly the lack of management. He asked me about Dave Dering and I responded "Dave Dering is an engineer, not a manager, he has no real management skills".

Allon then asked me how to approach the meeting with Donnelly. I suggested that they just sit and listen to their ideas.

I asked Allon to assure me that this meeting would be kept confidential between the two of us. He said that "I will have to tell Dave sooner or later, and that he was not going to get in the middle of the two of us".DI= **********************

SU= <February 15, 1991: Stan Caterbone with Jim Tritch & Allon Lefever>

Allon Lefever had requested a meeting to be certain that I was not representing the High's or American Helix. I had told Allon that I was not concerned with the merger issue, that the Advanced Media Group was continuing discussions with Barry Glick on various information technologies, that were strictly my business. I also informed him that Barry Glick had told me that "Stan, we are quite honestly more interested in you rather than the facility or American Helix". I also informed Allon that Barry asked if I would make a trip the Chicago, the corporate headquarters to discuss the technologies and specifically the manufacturing technologies of CD-ROM.

I made it perfectly clear that the two (2) contacts for a merger or acquisition that I had provided to the High's were contacts that approached me. I also notified them that Dave Dering had requested me to look for a joint venture partner as far back as November.

I also made it perfectly clear that I would not solicit any leads unless I was to be compensated. Allon suggested that it may help me to look for contacts, and I quite emphatically restated my contentions that I would not do any work without compensation.

Jim Tritch acknowledged that I was the only person responsible for the development of the CD-ROM business, and the only person with any real technical expertise in information technologies and CD-ROM, and that neither American Helix or High Industries had the capabilities to manufacture CD-ROMs without me.

Jim Tritch also admitted that the Advanced Media Group, Ltd., would have to be a purchased separately in the case of any merger or acquisition of American Helix.

Jim Tritch also stated that in his initial meeting with Donnelly that they like me and wanted to continue to work toward a business relationship.

Both Allon and Jim stated that they would like to continue to work with me in the CD-ROM business. DI= **********************

SU= <February 15, 1991: American Helix Staff Meeting>

Through an employee that was present during the meeting, I had learned that Dave Dering "spent 20 minutes "slimming" you and calling you a RUNAWAY EX-CONVICT THAT WOULD END UP IN JAIL SOON". Dave Dering also told the group that I had almost ruined the company, and I should not be trusted.

I was also informed the previous day that David Dering was telling persons that the reason that I was out of town in December was because "I was on the run from authorities".

<February 21, 1991: NIST Project "Training Discs" (3 Disc Set)

The 3-Disc CD-ROM replication project for the National Institute of Standards & Technology (NIST) was to be manufactured and shipped to the DARPA Conference in Pacific Grove, California. The remaining Stamper was to arrive from Disc Manufacturing Inc., by Federal Express. The Mastering was scheduled for a 7-Day Turnaround, which should have delivered all 3 stampers by Tuesday. CD ..1403 was already replicated and a disc was submitted to John Fiscus at NIST several days before to confirm and validate the integrity of the data by administering a byte to byte comparison between the CD-ROM disc and the in-house database. This is the most stringent and most accurate of any quality assurance tests for CD-ROMs. Because of the complexity of the data, and the UNIX operating system, this test is critical.

American Helix had replicated CD ..1403 and was beginning to run CD ..1404 when the controller board for the Mettalizer computer system brought production to a halt. The stamper from Disc Manufacturing had arrived that morning as anticipated, however it was still 2 days late.

The shipment of the NIST project was contingent upon the completion of the inserts and tray cards from Golden Rule. I required a 4-day turnaround for the printing, I notified all production managers that replication production would not begin until I received confirmation from Golden Rule on Thursday morning that 20 sets of printed materials had been shipped to the DARPA/NIST Conference in Pacific Grove, California. The production requirements called for 20 completed sets to be shipped to the DARPA/NIST conference on Friday.

<February 21, 1991> On Thursday morning I confirmed that Golden Rule would meet the shipping deadline that day. This 4-day turnaround was the second time that we had successfully completed a less than 5-day turn for printed materials, which on average takes the Audio group considerably longer.

However, a short time later I received a call from John fiscus of NIST notifying me that the data from CD ..1403 had failed the validation test. I immediately performed several diagnostics, and had found that although the directory structure of the CD-ROM was complete, there seemed to be data that was not physically located on the disc, although the file byte count displayed the correct amount of data.

I immediately notified the production personnel at American Helix that the NIST project would be put on hold until further notice. John Fiscus had agreed to try to contact John Garofolo at the conference in order to notify him that the shipment would not be arriving on Friday.

After evaluating the disc and the stamper, I had made a preliminary diagnosis that the cause of the problem was result of a bad ISO 9660 8mm tape submitted by NIST, or a problem in converting the data to another medium during the mastering process at Disc Manufacturing Inc.,. After

evaluating the quality control specifications of both the disc and the stamper, it was highly unlikely that the CD-ROM disc contained data that was not identical to that of the stamper or master.

I called Leon Whidbee, the engineer at Disc Manufacturing Inc., that same day to notify him of the problem, and to immediately begin diagnostic procedures in order to continue production and to deliver product to NIST ASAP.

I explained the problem to Leon Whidbee, and he immediately explained that he did not use the 8MM ISO 9660 tape to drive the mastering system as expected. Leon Whidbee explained that the block size and the record length of the tapes were not what he likes, and he had to down load that tape to another format. I mentioned that I originally suspected a problem in the conversion process, however I thought that a reoccurring problem with the new 8mm system required the conversation to a 1630 tape.

Leon the attributed the problem to the fact that the file specs were not within their parameters. I quickly asserted and made it perfectly clear that I will not assume any responsibility or accountability in any problem that occurred due to the file conversion. If the file was not within the required specifications, Disc Manufacturing Inc., had the responsibility to notify me so that I could have provided a new tape that was within specifications required by DMI, Inc., I notified Leon that DMI, Inc., must assume all financial responsibility if the problem was the result of the conversion.

Leon Whidbee said that he would try to load the initial data in order to diagnose the problem further. However, Leon, again expressed concern that he was busy with other projects. I tried to inform him that this was for a federal contract, and that we must find the problem ASAP in order fulfill the requirements of the contract. He assured me that he would at least load the data tomorrow, friday, and wanted the results of the validation tests for the remaining discs.

<February 22, 1991> On Friday, John Fiscus had confirmed that the second disc passed the validation test. I notified him that the third and last disc was finished, and that I would submit that disc for testing, by way of overnight mail for delivery on Monday. I had called Leon Whidbee and notified him that the second disc passed inspection and the third disc would be inspected on Monday. He had not yet begun to begin any diagnostics into the problem.

On Monday afternoon, I had called Giselle Venscel at Disc Manufacturing Inc, (DMI) concerned because of the lack of cooperation or the lack concern for a problem that exposing us to default on a federal government contract. Giselle immediately gave the same old story song and dance about not calling her, and that I should not be calling Leon. I again tried to explain that I cannot be expected to discuss technical specifications with a customer service person, and put my company at risk by having expecting that person to first understand what I am talking about, and second, interpreting that information to a qualified technical engineer. That makes no sense at all. In addition, I see no one concern about the real issue -- the bad data tapes.

In the middle of the conversation, Leon Whidbee called on the other line.

He finally had loaded the tapes, and I gave him the location of the data that was missing. He did acknowledge that on the NIST ISO 9660 tape, that there was evidence that the data was present. He then requested that I submit a sample disc for further evaluation. I again suggested that He immediately begin to produce the new tapes so that we can get the disc manufactured. I explained that we should worry about the accountability with the problem at a later time, after the client is take care of.

Later that day I received a call from John Fiscus, he requested that I submit another disc for verification for the CD ..1402. I said he would receive it tomorrow by Federal Express.

I faxed a request to Donna, the receptionist at American Helix, to prepare the Federal Express label to the NIST laboratory. I prepared a package for shipment to DMI.

At approximately 4:30 pm, on Monday, Donna phoned me and informed me that Sheri Diebler and David Dering had revoked all Federal Express privileges and postage privileges of Stan Caterbone and any CD-ROM activities. I emphatically explained to her that these deliveries were required to fulfill a Federal Contract with NIST, and that this action will provide unfortunate risk for default of that contract.

THE PARCELS DID NOT GO OUT TO DMI, OR NIST, AS REQUIRED.

<February 26, 1991> On Tuesday, I arrived at American Helix, and was immediately met by David Dering. I immediately questioned him about why the Fed Ex packages were not allowed to go out. He said, "Stan, you do not have and you never had Federal Express or Postage privileges, they were not part of our deal". I said " Dave, I have been Federal Expressing packages and using Postage for the past 10 months, and that was part of our deal, what are you talking about?, You have NIST quite upset, we you are holding up that Job". Dave went into a song and dance about his budget, only after becoming nervous when I challenged the fact that I have always been using the Federal Express and the Postage at American Helix. He assured me that both packages will be Federal Expressed immediately.

<February 27, 1991>

On Wednesday I talk to Giselle of DMI, Inc., to see if the production of the stamper was started. She notified me that it won't start until Leon Whidbee receives the sample disc. I said "What does that have to do with the production of the new stamper?, why should NIST have to wait until you find out who is responsible for the problem, let's just take care of the client first, isn't that our job?. I finally said "OK Giselle, when I get the stamper, I'll finish the job, I quite fighting you people, Goodbye!!"

I later found out that the sample disc that was supposed to be mailed overnight, was really shipped 2nd day air.

<February 28, 1991>

On Thursday, after arriving home from Washington, D.C., Dave Dering asked about the NIST job, I said Dave, NIST is quite upset, and I am not spending my time, playing silly games with people. When I get the

stamper, I'll finish the job, until then, I have more important matters to tend to, because it doesn't matter how well I do my job.

Later, John Garafolo, of NIST called to discuss allegations of default on CONTRACT 43NANB110167. I informed John, that American Helix is the contractor, and you should discuss these issues with Dave Dering. I cited several situations and actions by Dave Dering and American Helix that continued to compromise my business, my reputation, and most importantly the NIST Contract:

1. Unjustified and Illicit "Lock-Out" on January 12, 1991. 2. Defamation of Character & Slander (Staff Meeting) on February 15, 1991. 3. Obstruction of Business (Fed Ex) on February 25, 1991.DI= **********************TI=\ADVANCED MEDIA GROUP, Ltd., & R.R. DONNELLY STRATEGIC ALLIANCEDA= February 13, 1991

SU= SUMMARY: DONNELLY GEOSYSTEMS AND ADVANCED MEDIA GROUP, Ltd., STRATEGIC ALLIANCE PRELIMINARY DRAFT STRATEGIC PLAN

DEVELOPED BY:

STAN J. CATERBONE

STRATEGIC PLAN

1. To pursue the development of information applications utilizing the various digital technologies such as CD- ROM, Interactive Video Disc (IVD), Digital Video Interactive (DVI), etc., for the non-traditional businesses of Donnelly GeoSystems, and other R.R. Donnelly divisions.

2. To compliment the already existing information and telecommunications efforts of R.R. Donnelly by integrating the development of the above information applications for specific niche markets that would result in value added products and services utilizing the already existing information assets of R.R. Donnelly.

3. To specifically develop information applications from end to end and to provide the additional support necessary and required to take those respective productions and services to the market at large. 4. To provide and implement the necessary marketing research and strategies to effectively develop a new business of consumer and retail related businesses involving the respective information applications.

5. To research and develop new technologies for the telecommunications businesses that would integrate the

information applications for the electronic distribution of such information applications, resulting in the development of a new distribution network for already existing information applications. These technologies would focus on the "wireless" transmission of information applications utilizing microwave technologies.

6. To facilitate the development and implementation of INTERACTIVE EDUCATIONAL APPLICATIONS for the educational systems at large. To contribute to the developing efforts of the "private sector" in improving the quality of education through the utilization of the preceding information technologies through new strategic alliances of other active corporations such as IBM, Lucasfilm, and Xerox.

There are currently developing consortiums of individuals and corporations that realize the sense of social responsibility resulting in the contribution of available resources for specific purpose of improving the quality of our Educational Systems at large. There is enough evidence that this objective is far too aggressive for the current level of financing and funding that has been allocated under the Bush Administration.

It has been suggested that some of the larger private corporations contain not only the capital and technological resources to facilitate this effort, but more importantly the necessary human and management resources to implement this mission with a real sense of accountability and responsibility.

7. To specifically develop value added businesses and profit centers from a variety of products and services built on the foundation of the portfolio of mapping information assets currently owned by Donnelly GeoSystems.

8. To support and administer the manufacturing of CD- ROM applications through the acquisition or the strategic alliance of a CD manufacturing facility.

PLAN OF ACTION

1. To select a prototype interactive application that would compliment the recent efforts and development of the "Plan A Trip" mapping system.

2. To design an interactive information application from end to end including hardware, software, documentation, and marketing strategies to deliver it to the market at large.

3. To develop the information application with utilizing either a sampling of information, or the entire

information asset.

4. To conduct market research and indications of interest for the respective prototype.

5. To evaluate the feasibility and the interest of both R.R. Donnelly GeoSystems and the Advanced Media Group, Ltd., for continuing the a relationship for the purpose of pursuing the strategic plan.DI= ***************************************************************** TI=\ADVANCED MEDIA GROUP, Ltd., CAPABILITIES AND CLIENT LISTINGIM=AMG.CPRDA= February 17, 1990AT= AUDIO TRACKS: /ALLPA= PAGES: 11

SU= SUMMARY: The corresponding images will illustrate the global efforts of the Advanced Media Group, Ltd., including: HONG KONG; UNITED KINGDOM; CANADA; SOUTH AMERICAN; BRAZIL; AUSTRALIA; AUSTRIA; SPAIN; GREECE; and SOUTH AFRICA.

The following is the "Capabilities Statement" used in the marketing efforts of Stan Caterbone's Advanced Media Group, Ltd., Stan Caterbone developed the business in "Digital and Information Technologies" after American Helix and High Industries elected to discontinue the business after investing almost $ 1 million and not being able to develop any real business.

Stan Caterbone was the only person responsible and the only person with any real technical expertise in CD-ROM technology. In six months Stan Caterbone surpassed the amount of revenues that American Helix produced in 18 months. Stan Caterbone also completed one of the most technical projects for the National Institute of Standards and Technology (NIST). Phillips DuPont and Stan Caterbone were the only firms to compete on the project because of its level of difficulty and its required expertise.

Stan Caterbone was able to cause a fierce competition for the $2.5 million Department of Defense contract (DMA007-900-0011). Ironically the two other competitors were the very same companies that had been responsible for the development of CD-ROM, SONY (DADC) and Phillips DuPont (PDO). Incidently, the procurement is currently under investigation for possible misconduct after several grievances filed by Stan Caterbone.IM=AMG1.CPRDI= PAGE 2IM=AMG2.CPRDI= PAGE 3IM=AMG3.CPRDI= PAGE 4IM=AMG4.CPRDI= PAGE 5IM=AMG5.CPRDI= PAGE 6IM=AMG6.CPRDI= PAGE 7

IM=AMG7.CPRDI= PAGE 8IM=AMG8.CPRDI= PAGE 9IM=AMG9.CPRDI= PAGE 10IM=AMG10.CPRDI= PAGE 11

CAPABILITIES:

AMERICAN HELIX TECHNOLOGY CORPORATION

BACKGROUND

AmericanHelix was funded by High Industries, Inc., of Lancaster, PA, in 1987. As a wholly owned subsidiary of the High companies, AmericanHelix is joined by more than 40 companies managed and operated by the $250 million a year conglomerate. High Industries, Inc., currently serves the steel, precast/prestressed concrete, and commercial/industrial construction industries; as well as operating in industrial, commercial, and residential real estate, cable TV, food services, management consulting and development, hospitality services, communications and other related services.

AmericanHelix is situated in the 500 acre Greenfield Corporate Center, graced with aesthetically pleasing architecture, beautiful landscaping, broad walkways, fountains, and ponds. AmericanHelix contrasts the contemporary rural setting with its illuminating high-tech facility. The Advanced Media Group, LTD., which provides information technologies, also operates an office in downtown Washington, D. C., close to the government agencies.

AMERICAN HELIX SERVICES

AmericanHelix employees over 40 workers in its headquarters and manufacturing facility. In the first quarter of 1990, the company completed its first expansion, which doubled the output capacity of the plant. AmericanHelix has the ability to produce more than 3.6 million CD'S per year. AmericanHelix provides services for the CD technology industries. The state-of-the-art CD manufacturing facility was completed in December of 1988. The facility features a unique 3rd generation monoline processing module, designed and engineered by David D. Dering, founder and president. This extremely automated facility was designed and engineered with the objective of increasing manufacturing yields through increased performances from its quality techniques and processes. The facility manufactures both CD-AUDIO AND CD-ROM discs.

MANUFACTURING

The CD manufacturing facility features a 10,000 class clean room for

its replication operations. AmericanHelix features an aggressive approach to its quality assurance processes. During the manufacturing processes, the master stamper is inspected during three different quality control tests, before being installed into the injection molding machine. The stamper is visually inspected for surface flaws, and analyzed for both physical and data specifications. Adhering to the PHILLIPS/SONY Redbook and Yellowbook standards, is essential.

Upon the completion of the replication procedures, 100% of the discs are analyzed by the AID Analyzer for more than 10 different physical flaws. In addition the CD is inspected in the CD-CATS, the industry standard quality assurance device recognized by government agencies, for physical and data imperfections specifically designed for the CD-ROM industry.

100% of the discs are inspected again upon completion of the printing procedure and before being packaged. AmericanHelix considers it to be a leader in quality assurance. INFORMATION TECHNOLOGIES

Under the direction and ownership of Stan J. Caterbone, The Advanced Media Group, LTD., services the information technology market, and features end to end CD-ROM (WORM, DVI, CDTV, LASERDISC) production capabilities. The Advanced Media Group, LTD., firmly believes that the ability to provide efficient coordination and management to optical publishing projects is critical to it's success. Because of the extremely complex process of optical publishing, and the need for many disciplines during its production, the project manager must not only develop and produce an effective application, but he must also bring the project in within the prescribed budget.

By providing clients with the capabilities for end to end production, along with assuming the responsibility for the entire process, AmericanHelix delivers a cohesive, synchronized, and organized approach to developing information technology applications. The Advanced Media Group, LTD., has made a firm commitment to its development of various information technologies, without the dependency for any one type of medium.

The Advanced Media Group, LTD., provides Application Design Services; Data Conversions, Scanning and Keying; Data Preparation and Indexing; Software Configuration and Development; Application Simulation; Prototype and Storyboard Applications; Premastering, Mastering, and Replication; Exhibit Technologies; and Point of Sale Kiosks (POS).

Of course the Advanced Media Group, LTD., does not ignore the market for individual services. The menu of services can be selected to compliment the available efforts of any organization. Clients can select only services that it elects not to perform in-house. Understanding that there are several organizations with qualified and extremely innovative technology capabilities, the Advanced Media Group, LTD., would like to compliment those organizations

The Advanced Media Group has recently completed one of the most aggressive CD-ROM projects for the National Institute of Standards and Technologies (NIST), of Bethesda, Maryland, a government sanctioned technologies incubator for U.S. technologies at large. The project included over 25,000 UNIX Tar files and a CD-ROM of over 675 megabytes. Stan Caterbone and John Garafolo, Computer Scientist for NIST, have written an article containing valuable information that is useful when publishing UNIX applications on CD- ROM. The article will appear in the January issue of DISC Magazine, published by Helgerson Associates.

CLIENT LIST

National Institute of Standards & Technology (NIST) Groller Electronic Publishing E. Giovanetti Dialcom Vaghi Periodicles Clahritas Advanced Systems Development Compaq Computers Applied Optical Media Corp. Commodore Business Machines DRI/McGraw Hill Meridian Data Pennsylvania Blue Shield INFO ONE International University of Montana National Technical Info Svc Rochester Institute of Technology NEC Amp, Incorporated Parkway School District Hitachi Systems Division Department of Commerce Mathew Bender Co., Inc. Nortek Computers, Ltd., University Microfilm International Bell Atlantic Aspen Systems Corporation Microsoft CorporationRon Giordano Arther AndersonAtlantic Beach Realty PC Solutions Plus(609) 368-7023 Capitol RecordsMovie Real Estate Digital Audio Disc Corporation (SONY) Ingram Customer Systems University of Hawaii at Manoa National Bibliographic Service International Business Machines (IBM) Veterans AdministrationDI= ************************************************************

TI=\PROFESSIONAL ASSOCIATES AND CLIENTS OF STAN CATERBONE

RELATING TO FINANCIAL MANAGEMENT GROUP, Ltd.,

Dave Cook Turkey Hill Minit Markets Centerville Road Lancaster, PA 17603 (717) 299-8908 Movie, Bennet Williams

John Berg Associates Philadelphia, PA (215) 636-1900 Financing

Barry Newhardt Progress ... Lancaster, PA Financing, Real Estate

Andy Glosser Lanecor Associates Lancaster, PA Financing, Equity

Marylin Berger Daniel Berger Berger Real Estate E. New Street Lancaster, PA Financing, Real Estate

Jim Bly Source Capital 6725 Curran Street McLean, VA 22102 Financing, Movie, Airplane Rental $250/HR

Norris Boyd Boyd Wilson Olde Hickory Lancaster, PA 17601 (717) 569-0484 Financing, Movie

Fidelity Mortgage Michael Long Philadelphia, PA (215) 424-3100 Financing

Bill Tell PDQ Industries, Inc., Brownstown, PA (717) 656-4281 (717) 656-6892 FAX

0118163030550 (Japan Fax) R-DAT Financing, Movie,

Vic Romar Aviation Lancaster Airport Lancaster, PA 17601 (717) 569-8296 Pilot, "involved in repossession"

Tony Pascatti Underwriters Advisory 3605 N. Progress Ave. Harrisburg, PA 17110-9697 (717) 652-6686 Movie, Financing, FMG Insurance contracts

Al Dannat Institutional Investors 777 North Eldridge Parkway, Suite 730 Houston, TX 77079 (713) 497-8010 Mortgage Banker Dave Schaad Bennet Williams Realty York, PA (717) Real Estate Partnerships,

Birtcher Real Estate Bob Spicer Philadelphia, PA (215) 503-8537 Financing, Equity

Madelin Wooten John Keeble, President Financial Service Corp. Atlanta, GA

Bill O"Hara 554 Berkley Road Stone Harbor, NJ (609) 884-7199 Landlord,

Jack Mann Shelter Haven Rlty Stone Harbor, NJ Real Estate, Financing

Reg Pattey Burle Industries

New Holland Ave. Lancaster, PA Financing for Burle

Ned Grove Lancaster, PA Financing

Jerry Miller GEM Development Lancaster, PA Financing, Equity

Tom Kyle High Associates High Industries Lancaster, PA 17601 Financing, Partnerships, Movie

James Christian United Chem Con Lancaster, PA Financing, Movie,

Jules Goldfarb G/N Associates 2316 Dairy Road Lancaster PA 17601

David M. McClatchy MaClatchy 630 West Chestnut Street Lancaster PA 17601

Ed Vinson 10749 Falls Road Suite 202 Lutherville MD 21093

Len Shendell Columbia Asset Management Twining Office Center 715 Twining Road Dresher PA 19025

Jeff Springer Diversified Investment Asso. 16 South Calvert Street Suite 400 Baltimore MD 21202

Sal Belluardo John G Berg Asso. 1 Logan Square Suite 1105 Philadelphia PA 19107

Jeff King National Properties Inc. 150 East Swedesford Road Wayne PA 19087

Bob Fields Manor Group 1377-C Spencer Avenue Lancaster PA 17603

Mr.Rosenblatt

Max Gomburg Gomburg Associates 995 Greentree Road Pittsburgh PA 15220

Joel & Mimi Baron Baron 601 East Chestnut Street Lancaster PA 17602

RELATING TO THE ACTIVITIES OF THE DIGITAL FILM ("MUTANT MANIA")

Gene Clair Clair Bros Studios Lititz, PA Sound Production

Barbara Peters Arlene Davidson Marcia Silen Flatbush Films 4334 Stern Ave. Sherman Oaks, CA 91423 (818) 995-3417 Movie Producers

Rhema Video Service Philadelphia, PA (215) 738-3751 Movie Production

Tony Bongiovi Bob Walters Ellen Lipman Power Station Studios New York, NY Movie Partners

Ted Gammilion Mary Gamillion Gamillion Studios 1137 N. McCadden Pl. Hollywood, CA 90038

Mike Wolfe Commonwealth Bank (717) 780-3092 Loan Officer, Airplane

Mr. Cohouet Mellon Bank (412) 234-5000 Discussed Law Suit regarding reposssession

ATTORNEYS AT LAW

Joseph Roda, PC 301 Cipher Building 36 E. King Street Lancaster, PA 17602 (717) 397-3791

Robert D. Beyer Arnold, Beyer, Homsher 110 E. King Street Lancaster, PA 17602 (717) 394-7204

Lewis J. Schweller Valore, McAllister, Westmorland, Gould, Vesper & Schwartz Mainland Professional 535 Tilton Road Northfield, NJ 08255 (609) 645-1111

Rick Fox, Attorney Underwriters Group Progress Ave Harrisburg, PA

Jeff Jamounou McNesse, Wallice & Nurick Front Street Harrisburg, PA

Barry Cappello Diane Cambell Coppello & Foley 831 State Street Santa Barbara, CA 93101 (805) 564-2444

Mike McDonald Lancaster, PA 17604

Joel Goldhammer Sidel, Gonda, Goldhammer & Abbot

Philadelphia, PA (215) 568-8383

Kerry Steigerwalt, ESQ. 5450 Kirkwood Dr. K-3 San Diego, CA 94521 Sandy Gray c/o Kerry Steigerwalt San Diego, CA

AUTHORITIES

Intercon Special Svc. Frank Garrity 60 E. 42nd Street Suite 1045 New York, NY (212) 370-4430

Gib Armstrong (717) 786-862

Cris Mele Attorney General Office (717) 782-4482

Corporate Acconting Office P.O. Box Drawer 671 Dunkirk, NY 14048 11/25/87 Return 972386104 85 B48 10

Lancaster Chamber of Commerce Dave Wouols Lancaster, PA

State Police Lincoln Hwy East Lancaster, PA

Lancaster Police N. Queen Street Lancaster, PA

Governor Robert Casey Harrisburg, PA

Federal Bureau of Investigation, (FBI) Fred Martin (717) 232-8686

Pennsylvania Attorney General's Office Detective Boden Admitted Partners had a Power of Attorney, talked

to him in July

PERSONAL REFERENCES (Witness to Activities of '87)

Linda Davis Vega Orlando, Fl

Tuesday Barnette 431 S. Plum Street Mount Joy, PA (717) 653-4570

Rob Clark West Palm Beach, FL

Maggy Brodesser Cape May, NJ (609) 886-6035 (609) 886-2782

Mike Orstein York College York, PA (717) 560-0627

Tammy Cape May, NJ (609) 884-3425

Rudolph Valentino (717) 299-1473

Ric Obrect Calico Cat Stone Harbor, NJ (717) 394-8320

Bill Johnson Lancaster, PA (717) 285-3685

Michelle Hodge Middletown, DE (302) 378-4762 (609) 465-7924

CLIENTS OF STAN CATERBONE FOR FINANCIAL ADVISORY SERVICES

Dr. William Umiker 1350 Hillcrest Road Lancaster, PA 17603 (717) 394-9936

Millard Johnson Duff Ave.

Lancaster, PA 717) 285-3685

Richard Elson East Petersburg, PA

Dickie Coho Lancaster, PA

RELATING TO THE ACTIVITIES OF DIGITAL TECHNOLOGIES

David D. Dering James Boyer American Helix 1857 Colonial Village Lane Lancaster, PA 17601 (717) 392-7840

Allon Lefever Jim Tritcsh High Industries, Inc. William Penn Way Lancaster, PA 17601

Linda Helgerson Helgerson Associates Publishers 510 N. Washington St. Falls Church, VA 22046 (703) 237-0682

Steve Swan Data Development 42 Flagler Ave Stuart, FL 34995 (407) 288-7226

Gil Bowen Data Development 19th & L Street, N.W. Washington, DC (202) 785-8822

Slavek R. Rotkiewicz American Bankers Bond New York, NY 10004 (212) 943-4202

Tom Vreeland Amy Kovarick Ann Richards NETWORK TECHNOLOGIES Springfield, VA (703) 866-9000

Marshall Mathews Terry Harple

Ferranti International Lancaster, PA (717) 285-7151

Charles Bauer, Sr. Skip Strovel B&B Information & Image 8325 Marlboro Pike Upper Marlboro, MD (301) 735-3690

Lucy Griffen Joan Gervino American Bankers Association 1120 Connecticut Ave. N.W Washington, DC 20036 (202) 663-5491

Dr. William Sailer Trinity Church 205 N. Railroad St. Myerstown, PA 17607 (717) 866-5775

Mike Kawahara Commodore Computers 1200 Wilson Drive West Chester, PA 19380 (215) 431-9452

Mike Grubbs Tandy Electronics Houston, TX 76102 (817) 390-3693

Lloyd E. Lewis Library of Congress Washington, DC 20541 (202) 707-1308

Dave Benfer EXXON Production Research 3120 Buffalo Speedway Houston, TX 77252-2189

Ed Bauergard Amp, Inc. 2909 Fulling Mill Rd Middletown, PA (717) 986-7455

Harry Needleman Labott Anderson NASA Library Washington, DC

Thomas Thiel Scott Kathey McKosky Advanced Systems Development Arlington, VA

Ken Rudolph American Helix Lancaster, PA

Kenneth Clark Bell Atlantic Democracy Blvd Bethesda, MD 20817 (301) 493-3541

Carmen J. Martin Ford New Holland 500 Diller Ave New Holland, PA 17557 (717) 355-1638

Wayne Landis PC Solutions 159 Windy Hill Road Duncannon, PA 17020 (717) 834-9227

Jan L. Kloiber Arthur Anderson 69 West Washington St. Chicago, IL 60602 (312) 507-2548

Bruce Kline Mike Hess Miracle Concepts Lancaster, PA (717) 299-7382

Leroy J. Tuscher, Ph.D. Lehigh University 111 Research Drive Mountain Campus Bethleham, PA 18015 (215) 758-3231

Earl H. Horton, Ed.D. Superintendant Hempfield School District Landisville, PA 17538 (717) 898-5560

Cogressman Robert Walker House of Representatives Washington, D.C. 20515

Dave Gribbin Assistant Secretary of Defense Washington, D.C. 20301 OSD # 19043

William M. Nelson Contracting Officer Defense Mapping Agency Department of Defense 3200 S. Second St. St. Lois, MO 63118 (314) 263-8502

Stanley O. Smith Brigadier General, US AIR FORCE, CHIEF OF STAFF Department of Defense Defense Mapping Agency Fairfax, VA 22031

John Garofolo, C.S. Dr. David Pallet, Ph.D Sandy Ressler NIST (NATIONAL INSTITUTE OF STANDARDS & TECHNOLOGY) Gaithersburg, MD (301) 975-3193

Alan Hamerslee Gisele Vencel Leon Whidbee Ash Pawha Wan Segemiller Disc Manufacturiing, Inc 1120 Cosby Way Anahiem, CA (714) 630-6700

Lance Buder Sylvester Pufek Optical Media Int'l Los Alamos, CA

Bill Tufte Standard Technology, Inc., 6116 Executive Blvd Rockville, MD 20852 (301) 770-2800

Pat Tomes Paul A. Will National Association of Clock Collectors 514 Poplar Street Columbia, PA 17512 (717) 684-8261

Michael Morgatta Technomic Publishing

851 New Holland Ave. Lancaster, PA (717) 291-5609

Dr. Barry Glick RR Donelly & Sons Cardiographic Division 53 West James Street Lancaster, PA 17603 (717) 393-8806

Susan Shiner ISC EDUCATIONAL SYSTEMS, INC. FERRANTI INTERNATIONAL SIGNAL, INC. 3700 Electronics Way Lancaster, PA 17604-3040 (717) 898-0890DI= ************************************************************

TI=\NEWS REPORTS

SU= THE FOLLOWING NEWS REPORTS ARE ACCOUNTS OF THE ACTIVITIES OF JAMES GUERIN AND INTERNATIONAL SIGNAL & CONTROL (ISC) AND OTHER KEY PERSONS INVOLVED WITH THE ISC SCANDAL.

IM=30.CPRDI= "ISC IN $1.5 BILLION MERGER WITH ENGLISH"DI= September 21, 1987

IM=41.CPRDI= "FAREWELL, LANCASTER, WE'RE GOING TO MISS YOU"DI= August 3, 1989

IM=42.CPRDI= "FAREWELL, LANCASTER, .... CONTINUED

IM=34.CPRDI= "FERRANTI SUES GUERIN, 3 AIDES FOR $198.5 MILLION" (Resch)DI= December 1, 1989

IM=35.CPRDI= "FERRANTI SUES GUERIN, 3 AIDES ....." continued

IM=31.CPRDI= "INVESTIGATORS TIE GUERIN'S SON TO SEIZED SHIPMENT"DI= December 2, 1989

IM=1.CPRDI= "THE FERRANTI FRAUD"DI= January 5, 1990

IM=2.CPRDI= "THE FERRANTI FRAUD", continued

IM=3.CPRDI= "THE FERRANTI FRAUD", LARRY RESCH, continued

IM=4.CPRDI= "THE FERRANTI FRAUD", continued"

IM=38.CPRDI= "GUERIN IS EXPECTED TO TESTIFY" (Roda)DI= January 8, 1990

IM=36.CPRDI= "GUERIN ARRIVES TO TESTIFY ON $2.75-MILLION DISPUTE" (Roda)DI= January 9, 1990

IM=39.CPRDI= "GUERIN SUED FOR SECRET TAPES" (Roda)DI= January 10, 1990

IM=37.CPRDI= "GUERIN SUED FOR SECRET...." continued

IM=40.CPRDI= "RECORDS SEIZED AT LOCAL HOME AID PROBE OF GUERIN-SOUTH AFRICA (JACOBSON)"DI= January 23, 1990 (BELGIUM, NEW YORK)

IM=5.CPRDI= PAGE 5 "GUERIN: CLARK SAID HE COULD PUT ME IN PRISON FOR 50 YEARS"DI= January 24, 1990

IM=6.CPRDI= PAGE 6 "ILLEGAL CONTRIBUTIONS TO HAIG ALLEGED"DI= January 24, 1990

IM=7.CPRDI= PAGE 7 "HAIG DONATIONS", "FERRANTI SUES", "KEITH MARTIN"DI= January 24, 1990

IM=8.CPRDI= "HAIG DONATIONS", continued

IM=327.CPRDI= "U.S. AGENT CHARGES GUERIN DIRECTED WORLDWIDE FRAUD" DI= May 15, 1990

IM=10.CPRDI= "JACOBSON GETS JAIL FOR ROLE IN BRIBE SCAM"DI= May 16, 1990

IM=11.CPRDI= "FBI TIES GUERIN TO ILLEGAL MILITARY SALES"DI= May 16, 1990

IM=13.CPRDI= "CHRISTIAN ANGERED BY JACOBSON'S SENTENCE"DI= May 16, 1990

IM=14.CPRDI= "COURT TOLD ATTORNEY CLARK TRIED TO STOP ISC 'CROOKS'"DI= May 17, 1990

IM=15.CPRDI= "CLARK, GUERIN", continued

IM=16.CPRDI= "GUILT IS ADMITTED BY GUERIN COMPANY", PARENT INDUSTRIES, INC.,DI= May 18, 1990

IM=19.CPRDI= "GUERIN COMPANY GUILTY"DI= May 18, 1990

IM=17.CPRDI= "JUDGE TELLS GUERIN TO PAY $189 MILLION"DI= June 18, 1990

IM=18.CPRDI= "GUERIN LOSES CASE", continued

IM=32.CPRDI= "FBI LINKS GUERIN TO S. AFRICAN ARMS SALES" (Jacobson)DI= July, 1990

IM=20.CPRDI= "PROBERS FINDING ISC'S S. AFRICAN TIES WERE CLOSE", ED SYSTEMSDI= January 14, 1991

IM=21.CPRDI= "ISC:CLOSE TIES TO SOUTH AFRICA PROBED", continued

IM=22.CPRDI= "GUERIN vs. CLARK 'BLACKMAIL' TAPES REVEALED"DI= February 7, 1991

IM=23.CPRDI= "'BLACKMAIL'", continued

IM=24.CPRDI= "LANCASTER AVIATION FILES FOR BANKRUPTCY"DI= February 9, 1991

IM=25.CPRDI= "GUERIN BREAKS SILENCE OVER '20/20' REPORTING"DI= February 3, 1991

IM=27.CPRDI= "STORY: DEALS BY ISC SENT IRAQ BOMBS, BUT GUERIN DENIES SALES"DI= February 2, 1991

IM=29.CPRDI= "JUDGE DELAYS HEARING IN GUERIN-CLARK DISPUTE OVER CASH"DI= February 9, 1991

IM=STOCK.CPRDI= "MANAGER ACQUITTED OF LYING IN SALE OF FERRANTI STOCK"DI= February 14, 1991DI= ************************************************************

TI=\IMPLICATED PERSONS EXEMPLIFYING MISCONDUCT AND IMPROPRIETIES DA= February 17, 1991

SU= IMPLICATED PERSONS AND OR ENTITIES

COMMONWEALTH BANK, MIKE WOLF

LANCASTER AVIATION, CHUCK SMITH, PETE WHOLFSON

ROBERT KAUFFMAN, FINANCIAL MANAGEMENT GROUP, Ltd.,

MICHAEL HARTLETT, FINANCIAL MANAGEMENT GROUP, Ltd.,

ROBERT LONG, FINANCIAL MANAGEMENT GROUP, Ltd.,

PETER PENEROS, FINANCIAL MANAGEMENT GROUP, Ltd.,

P. ALAN LOSS, FINANCIAL MANAGEMENT GROUP, Ltd.,

DETECTIVE LARRY MATHIAS, MANHEIM TOWNSHIP POLICE DEPARTMENT

DETECTIVE LARRY SIGLER, MANHEIM TOWNSHIP POLICE DEPARTMENT

MURRAY HORTON, DISTRICT JUSTICE (MANHEIM TOWNSHIP)

RICHARD REESER, DISTRICT JUSTICE, (NEW HOLLAND)

ARRESTING OFFICERS (MANHEIM TOWNSHIP POLICE DEPARTMENT)

CRAIG RUSSEL, ATTY, RUSSSEL, CRAFT, GRUBER, & HUBER

LANCASTER NEWSPAPERS

STATE SENATOR GIB ARMSTRONG

JOSEPH RODA, ATTORNEY

MANHEIM TOWNSHIP POLICE DEPARTMENT

AVOLON POLICE DEPARTMENT, NEW JERSEY

STONE HARBOR POLICE DEPARTMENT, STONE HARBOR

FULTON BANK PETER RICHTER, FARMERS FIRST BANK, DI= *******************************************

"THE ENERGIES AND EFFORTS OF THIS PROJECT ARE DEDICATED TO MY BELOVED BROTHER --- SAMMY, GOD REST HIS SOUL" LAID TO REST ON DECEMBER 25, 1985