RE: 1993 PURCHASE OF A VARIABLE LIFE INSURANCE CLIENT ALLEGES MISREPRESENTATION RE THE POLICY BEING PAID UP. THE INSURED DID NOT ALLEGE SPECIFIC DAMES

$46,050.61

$16,447.44

PRUDENTIAL RESCINDED BOTH POLICIES AND RETURNED THE PREMIUMS PAID TO [CUSTOMERS]. ESTIMATE SETTLEMENT COSTS - $16,447.44. MY RECORDS SHOW THAT I DID IN FACT GIVE [CUSTOMERS] A PROSPECTUS. THEY SIGNED A FORM ACKNOWLEDGING RECEIPT OF THE PROSPECTUS. PRUDENTIAL MADE NO ALLEGATIONS CONCERNING MY ACTIONS.

$367,809.82

Tax

AS AN OFFICER OF ELCO AUTO SYSTEMS, INC. THE STATE OF NEW JERSEY FILED A SALES TAX LIEN AGAINST ME PERSONALLY FOR CORPORATE SALES TAXES WHICH WERE IN ARREARS. A JUDGEMENT WAS ENTERED FOR TAXES, PENALTIES AND INTEREST TOTALLING $367,809.82. NO CHARGES OF MISCONDUCT WERE MADE AGAINST ME. HOWEVER, AS AN OFFICER OF ELCO, THE STATE HELD ME LIABLE FOR UNPAID TAXES. ELCO IS PRIMARILY LIABLE FOR THESE TAXES AND THE STATE OF NEW JERSEY WILL BE PAID ALL OR A PORTION OF THIS BALANCE AS PART OF THE FINAL DISTRIBUTION FROM ELCO'S LIQUIDATION. THE FINAL RESOLUTION IS PENDING ELCO'S CHAPTER 7 LIQUIDATION. THIS LIABILITY REPRESENTS A PRIORITY CLAIM WHICH MUST BE SATISFIED BEFORE ANY DISTRIBUTION TO UNSECURED CREDITORS.