BUSINESS BASICS. Personnel Requirements, Tasks to perform, Job Description, Personnel Policy

BUSINESS BASICS 1. Getting Started Forms of Organization Licenses Required Permits Required Insurance 2. Operating Start from Scratch Part Time vs. Full Time Buying 3. Financing Types Costs Sources 4. Required Records Bookkeeping Systems (Manual vs. Computer) Types (Cash, Hybrid, Accrual) Payroll 5. Leverage Employees: Subcontractors Joint Ventures Personnel Requirements, Tasks to perform, Job Description, Personnel Policy 6. Marketing Who is your prospect? (Think Niche) Where are they? (Lists) Reaching Them Media: DM, FAX, Voice Broadcast, TV, Radio Package vs. Products Advertising Publicity Branding 7. Taxes Entity Personal 8. Attitudes/Abilities 9. Assets Personal Vehicle Home vs. Office Control/Isolation

BUSINESS STARTUP CHECKLIST Reserve the entity s name Articles of Organization/Incorporation Order Corporation Kit Stock Certificates, Specimen Minutes, Book and Seal Organization Minutes Federal Employer s Identification Number S-Election State-Employer s Corporation Filing, Sales Tax Registration, Employer s Withholding City Business License State License(s) Contractor s, Beverage, Tobacco, Tire Federal License(s) Heavy Vehicle Insurance Liability, Vehicle, Umbrella, Bond, Worker s Compensation Employment Commission (VEC) Bank Account Business Books Business Forms Stationery & Envelopes, Business Cards, Invoices, Estimate Forms

SCHEDULE C (Form 1040) Department of the Treasury Internal Revenue Service Name of proprietor (99) Profit or Loss From Business (Sole Proprietorship) Partnerships, joint ventures, etc., must file Form 1065 or 1065-B. Attach to Form 1040 or 1041. See Instructions for Schedule C (Form 1040). OMB No. 1545-0074 2005 Attachment Sequence No. 09 Social security number (SSN) A Principal business or profession, including product or service (see page C-2 of the instructions) B Enter code from pages C-8, 9, & 10 C Business name. If no separate business name, leave blank. D Employer ID number (EIN), if any E F G H Part I Business address (including suite or room no.) City, town or post office, state, and ZIP code Accounting method: Did you materially participate in the operation of this business during 2005? If No, see page C-3 for limit on losses Yes If you started or acquired this business during 2005, check here................................................ Income (1) Cash (2) Accrual (3) Other (specify) No 1 Gross receipts or sales. Caution. If this income was reported to you on Form W-2 and the Statutory employee box on that form was checked, see page C-3 and check here................ 2 Returns and allowances........................................................ 3 Subtract line 2 from line 1............................................................... 4 Cost of goods sold (from line 42 on page 2)............................................ 5 6 Gross profit. Subtract line 4 from line 3.................................................... Other income, including Federal and state gasoline or fuel tax credit or refund (see page C-3)....... 1 2 3 4 5 6 7 Gross income. Add lines 5 and 6...................................................... 7 Part II 8 9 10 11 12 13 ISA STF FED2615F.1 Expenses. Enter expenses for business use of your home only on line 30. Advertising................ Car and truck expenses (see page C-3)............... Commissions and fees..... Contract labor (see page C-4) Depletion................. Depreciation and section 179 expense deduction (not included in Part III) (see page C-4).............. 8 9 10 11 12 13 21 22 23 24 Repairs and maintenance.... Supplies (not included in Part III).. Taxes and licenses......... Travel, meals, and entertainment: a Travel..................... 14 Employee benefit programs b Deductible meals and (other than on line 19)..... 14 entertainment (see page C-5) 15 Insurance (other than health). 15 25 Utilities................... 16 a Interest: Mortgage (paid to banks, etc.).. b Other.................... 17 Legal and professional services.................. 16a 16b 17 18 19 20 26 27 Office expense............ Pension and profit-sharing plans Rent or lease (see page C-5): a Vehicles, machinery, and equipment.. b Other business property...... Wages (less employment credits).. Other expenses (from line 48 on page 2)...................... 28 Total expenses before expenses for business use of home. Add lines 8 through 27 in columns... 28 29 30 31 32 Tentative profit (loss). Subtract line 28 from line 7............................................ Expenses for business use of your home. Attach Form 8829............................... Net profit or (loss). Subtract line 30 from line 29. If a profit, enter on Form 1040, line 12, and also on Schedule SE, line 2 (statutory employees, see page C-6). Estates and trusts, enter on Form 1041, line 3. If a loss, you must go to line 32. If you have a loss, check the box that describes your investment in this activity (see page C-6). If you checked 32a, enter the loss on Form 1040, line 12, and also on Schedule SE, line 2 (statutory employees, see page C-6). Estates and trusts, enter on Form 1041, line 3. If you checked 32b, you must attach Form 6198. Your loss may be limited. For Paperwork Reduction Act Notice, see page C-7 of the instructions. } } 18 19 20a 20b 21 22 23 24a 24b 25 26 27 29 30 31 32a 32b All investment is at risk. Some investment is not at risk. Schedule C (Form 1040) 2005

Schedule C (Form 1040) 2005 Part III 33 34 Cost of Goods Sold (see page C-6) Method(s) used to value closing inventory: a Cost b Lower of cost or market c Other (attach explanation) Was there any change in determining quantities, costs, or valuations between opening and closing inventory? If Yes, attach explanation....................................................................... Yes Page 2 No 35 Inventory at beginning of year. If different from last year s closing inventory, attach explanation.... 35 36 Purchases less cost of items withdrawn for personal use............................... 36 37 Cost of labor. Do not include any amounts paid to yourself.............................. 37 38 Materials and supplies......................................................... 38 39 Other costs............................................................ 39 40 Add lines 35 through 39...................................................... 40 41 Inventory at end of year....................................................... 42 Cost of goods sold. Subtract line 41 from line 40. Enter the result here and on page 1, line 4..... 42 Part IV Information on Your Vehicle. Complete this part only if you are claiming car or truck expenses on line 9 and are not required to file Form 4562 for this business. See the instructions for line 13 on page C-4 to find out if you must file Form 4562. 41 43 44 When did you place your vehicle in service for business purposes? (month, day, year). Of the total number of miles you drove your vehicle during 2005, enter the number of miles you used your vehicle for: a Business b Commuting (see instructions) c Other 45 Do you (or your spouse) have another vehicle available for personal use?.............................. 46 Was your vehicle available for personal use during off-duty hours?.................................. 47a Do you have evidence to support your deduction?.............................................. b If Yes, is the evidence written?............................................................ Part V Other Expenses. List below business expenses not included on lines 8 26 or line 30. Yes Yes Yes Yes No No No No 48 Total other expenses. Enter here and on page 1, line 27............................... 48 Schedule C (Form 1040) 2005 STF FED2615F.2

Form 4562 (Rev. January 2006) Department of the Treasury Internal Revenue Service Depreciation and Amortization (Including Information on Listed Property) See separate instructions. Attach to your tax return. OMB No. 1545-0172 2005 Attachment Sequence No. 67 Name(s) shown on return Business or activity to which this form relates Identifying number Part I Election To Expense Certain Property Under Section 179 Note: If you have any listed property, complete Part V before you complete Part I. 1 Maximum amount. See instructions for a higher limit for certain businesses.................... 1 $105,000 2 Total cost of section 179 property placed in service (see instructions)......................... 2 3 Threshold cost of section 179 property before reduction in limitation......................... 3 $420,000 4 Reduction in limitation. Subtract line 3 from line 2. If zero or less, enter -0-.................... 4 5 Dollar limitation for tax year. Subtract line 4 from line 1. If zero or less, enter -0-. If married filing separately, see instructions......................................................... 5 6 (a) Description of property (b) Cost (business use only) (c) Elected cost 7 Listed property. Enter the amount from line 29....................... 7 8 Total elected cost of section 179 property. Add amounts in column (c), lines 6 and 7............. 8 9 Tentative deduction. Enter the smaller of line 5 or line 8................................... 9 10 Carryover of disallowed deduction from line 13 of your 2004 Form 4562...................... 10 11 Business income limitation. Enter the smaller of business income (not less than zero) or line 5 (see instructions)......... 11 12 Section 179 expense deduction. Add lines 9 and 10, but do not enter more than line 11.......... 12 13 Carryover of disallowed deduction to 2006. Add lines 9 and 10, less line 12 13 Note: Do not use Part II or Part III below for listed property. Instead, use Part V. Part II Special Depreciation Allowance and Other Depreciation (Do not include listed property.) (See instructions.) 14 Special allowance for certain aircraft, certain property with a longproduction period, and qualified NYL or GO Zone property (other than listed property) placed in service during the tax year (see instructions) 14 15 Property subject to section 168(f)(1) election............................................ 15 16 Other depreciation (including ACRS).................................................. 16 Part III MACRS Depreciation (Do not include listed property.) (See instructions.) Section A 17 MACRS deductions for assets placed in service in tax years beginning before 2005............. 17 18 If you are electing to group any assets placed in service during the tax year into one or more general asset accounts, check here.............................................. j Section B Assets Placed in Service During 2005 Tax Year Using the General Depreciation System (b) Month and (c) Basis for depreciation (a) Classification of property year placed in (business/investment use service only see instructions) (d) Recovery period (e) Convention (f) Method (g) Depreciation deduction 19a 3-year property b 5-year property c 7-year property d 10-year property e 15-year property f 20-year property g 25-year property 25 yrs. S/L h Residential rental 27.5 yrs. MM S/L property 27.5 yrs. MM S/L i Nonresidentialrental 39 yrs. MM S/L property MM S/L Section C Assets Placed in Service During 2005 Tax Year Using the Alternative Depreciation System 20a Class life S/L b 12-year 12 yrs. S/L c 40-year 40 yrs. MM S/L Part IV Summary (See instructions.) 21 Listed property. Enter amount from line 28.............................................. 21 22 Total. Add amounts from line 12, lines 14 through 17, lines 19 and 20 in column (g), and line 21. Enter here and on the appropriate lines of your return. Partnerships and S corporations see instr.. 22 23 For assets shown above and placed in service during the current year, enter the portion of the basis attributable to section 263A costs..... 23 For Paperwork Reduction Act Notice, see separate instructions. Form 4562 (2005) (Rev. 1-2006) ISA STF FED5085F.1

Form 4562 (2005) (Rev. 1-2006) Page 2 Part V Listed Property (Include automobiles, certain other vehicles, cellular telephones, certain computers, and property used for entertainment, recreation, or amusement.) Note: For any vehicle for which you are using the standard mileage rate or deducting lease expense, complete only 24a, 24b, columns (a) through (c) of Section A, all of Section B, and Section C if applicable. Section A Depreciation and Other Information (Caution: See the instructions for limits for passenger automobiles.) 24a Do you have evidence to support the business/investment use claimed? j Yes j No 24b If Yes, is the evidence written? j Yes j No (c) (a) (b) Business/ (d) Type of property (list Date placed in investment Cost or other vehicles first) service use basis (e) Basis for depreciation (business/investment use only) (f) (g) (h) Recovery Method/ Depreciation period Convention deduction percentage 25 Special allowance for certain aircraft, certain property with a long production period, and qualified NYL or GO Zone property placed in service during the tax year and used more than 50% in a qualified business use (see instructions)... 25 26 Property used more than 50% in a qualified business use: % % % 27 Property used 50% or less in a qualified business use: % S/L- % S/L- % S/L- 28 Add amounts in column (h), lines 25 through 27. Enter here and on line 21, page 1.......... 28 29 Add amounts in column (i), line 26. Enter here and on line 7, page 1.................................. 29 Section B Information on Use of Vehicles Complete this section for vehicles used by a sole proprietor, partner, or other more than 5% owner, or related person. If you provided vehicles to your employees, first answer the questions in Section C to see if you meet an exception to completing this section for those vehicles. 30 Total business/investment miles driven during the year (do not include commuting miles)........................... 31 Total commuting miles driven during the year... 32 Total other personal (noncommuting) miles driven........................... 33 Total miles driven during the year. Add lines 30 through 32................... (i) Elected section 179 cost 34 Was the vehicle available for personal use Yes No Yes No Yes No Yes No Yes No Yes No during off-duty hours?................. 35 Was the vehicle used primarily by a more than 5% owner or related person?.......... 36 Is another vehicle available for personal use?............................ Section C Questions for Employers Who Provide Vehicles for Use by Their Employees Answer these questions to determine if you meet an exception to completing Section B for vehicles used by employees who are not more than 5% owners or related persons (see instructions). 37 Do you maintain a written policy statement that prohibits all personal use of vehicles, including commuting, by your Yes No employees?................................................................................ 38 Do you maintain a written policy statement that prohibits personal use of vehicles, except commuting, by your employees? See the instructions for vehicles used by corporate officers, directors, or 1% or more owners......... 39 Do you treat all use of vehicles by employees as personal use?........................................ 40 Do you provide more than five vehicles to your employees, obtain information from your employees about the use of the vehicles, and retain the information received?................................................. 41 Do you meet the requirements concerning qualified automobile demonstration use? (See instructions.).......... Note: If your answer to 37, 38, 39, 40, or 41 is Yes, do not complete Section B for the covered vehicles. Part VI Amortization (a) Description of costs (b) (c) (d) Date amortization Amortizable Code begins amount section 42 Amortization of costs that begins during your 2005 tax year (see instructions): (a) (b) (c) (d) (e) (f) Vehicle 1 Vehicle 2 Vehicle 3 Vehicle 4 Vehicle 5 Vehicle 6 (e) Amortization period or percentage (f) Amortization for this year 43 Amortization of costs that began before your 2005 tax year................................ 43 44 Total. Add amounts in column (f). See the instructions for where to report..................... 44 Form 4562 (2005) (Rev. 1-2006) STF FED5085F.2

SCHEDULE SE (Form 1040) Self-Employment Tax Department of the Treasury Internal Revenue Service (99) Attach to Form 1040. See Instructions for Schedule SE (Form 1040). Name of person with self-employment income (as shown on Form 1040) Social security number of person with self-employment income OMB No. 1545-0074 2005 Attachment Sequence No. 17 Who Must File Schedule SE You must file Schedule SE if: You had net earnings from self-employment from other than church employee income (line 4 of Short Schedule SE or line 4c of Long Schedule SE) of $400 or more, or You had church employee income of $108.28 or more. Income from services you performed as a minister or a member of a religious order is not church employee income (see page SE-1). Note. Even if you had a loss or a small amount of income from self-employment, it may be to your benefit to file Schedule SE and use either optional method in Part II of Long Schedule SE (see page SE-3). Exception. If your only self-employment income was from earnings as a minister, member of a religious order, or Christian Science practitioner and you filed Form 4361 and received IRS approval not to be taxed on those earnings, do not file Schedule SE. Instead, write Exempt Form 4361 on Form 1040, line 58. May I Use Short Schedule SE or Must I Use Long Schedule SE? Did You Receive Wages or Tips in 2005? No Yes Are you a minister, member of a religious order, or Christian Science practitioner who received IRS approval not to be taxed on earnings from these sources, but you owe self-employment tax on other earnings? Yes Was the total of your wages and tips subject to social security or railroad retirement tax plus your net earnings from self-employment more than $90,000? Yes No Are you using one of the optional methods to figure your net earnings (see page SE-3)? No Did you receive church employee income reported on Form W-2 of $108.28 or more? Yes Yes No No Did you receive tips subject to social security or Medicare tax that you did not report to your employer? Yes No You May Use Short Schedule SE Below You Must Use Long Schedule SE on page 2 Section A Short Schedule SE. Caution. Read above to see if you can use Short Schedule SE. 1 Net farm profit or (loss) from Schedule F, line 36, and farm partnerships, Schedule K-1 (Form 1065), box 14, code A........................................................... 2 Net profit or (loss) from Schedule C, line 31; Schedule C-EZ, line 3; Schedule K-1 (Form 1065), box 14, code A (other than farming); and Schedule K-1 (Form 1065-B), box 9. Ministers and members of religious orders, see page SE-1 for amounts to report on this line. See page SE-2 for other income to report.................................................. 3 Combine lines 1 and 2........................................................... 4 Net earnings from self-employment. Multiply line 3 by 92.35% (.9235). If less than $400, do not file this schedule; you do not owe self-employment tax..................... 5 Self-employment tax. If the amount on line 4 is: $90,000 or less, multiply line 4 by 15.3% (.153). Enter the result here and on Form 1040, line 58. More than $90,000, multiply line 4 by 2.9% (.029). Then, add $11,16 to the result. Enter the total here and on Form 1040, line 58. }....... 1 2 3 4 5 6 Deduction for one-half of self-employment tax. Multiply line 5 by 50% (.5). Enter the result here and on Form 1040, line 27......... For Paperwork Reduction Act Notice, see Form 1040 instructions. Schedule SE (Form 1040) 2005 ISA STF FED2633F.1 6

Schedule SE (Form 1040) 2005 Name of person with self-employment income (as shown on Form 1040) Section B Long Schedule SE Attachment Sequence No. 17 Social security number of person with self-employment income Page 2 Part I Self-Employment Tax Note. If your only income subject to self-employment tax is church employee income, skip lines 1 through 4b. Enter -0- on line 4c and go to line 5a. Income from services you performed as a minister or a member of a religious order is not church employee income. See page SE-1. A If you are a minister, member of a religious order, or Christian Science practitioner and you filed Form 4361, but you had $400 or more of other net earnings from self-employment, check here and continue with Part I............. 1 Net farm profit or (loss) from Schedule F, line 36, and farm partnerships, Schedule K-1 (Form 1065), box 14, code A. Note. Skip this line if you use the farm optional method (see page SE-4) 1 2 Net profit or (loss) from Schedule C, line 31; Schedule C-EZ, line 3; Schedule K-1 (Form 1065), box 14, code A (other than farming); and Schedule K-1 (Form 1065-B), box 9. Ministers and members of religious orders, see page SE-1 for amounts to report on this line. See page SE-2 for other income to report. Note. Skip this line if you use the nonfarm optional method (see page SE-4) 2 3 Combine lines 1 and 2........................................................... 3 4a If line 3 is more than zero, multiply line 3 by 92.35% (.9235). Otherwise, enter amount from line 3 4a b If you elect one or both of the optional methods, enter the total of lines 15 and 17 here..... 4b c Combine lines 4a and 4b. If less than $400, stop; you do not owe self-employment tax. Exception. If less than $400 and you had church employee income, enter -0- and continue............ 4c 5a Enteryour church employee income from FormW-2. See page SE-1 for definition of church employee income......................... 5a b 6 7 Maximum amount of combined wages and self-employment earnings subject to social security tax or the 6.2% portion of the 7.65% railroad retirement (tier 1) tax for 2005.............. 7 8a Total social security wages and tips (total of boxes 3 and 7 on Form(s) W-2) and railroad retirement (tier 1) compensation. If $90,000 or more, skip lines 8b through 10, and go to line 11................... 8a b Unreported tips subject to social security tax (from Form 4137, line 9) 8b c Add lines 8a and 8b....................................................... 8c 9 Subtract line 8c from line 7. If zero or less, enter -0- here and on line 10 and go to line 11. 9 10 Multiply the smaller of line 6 or line 9 by 12.4% (.124).............................. 10 11 Multiply line 6 by 2.9% (.029)............................................... 11 12 Self-employment tax. Add lines 10 and 11. Enter here and on Form 1040, line 58......... 12 13 Deduction for one-half of self-employment tax. Multiply line 12 by 50% (.5). Enter the result here and on Form 1040, line 27........ 13 Part II Multiply line 5a by 92.35% (.9235). If less than $100, enter -0-........................ Net earnings from self-employment. Add lines 4c and 5b.......................... STF FED2633F.2 Optional Methods To Figure Net Earnings (see page SE-3) Farm Optional Method. You may use this method only if (a) your gross farm income 1 was not more than $2,400 or (b) your net farm profits 2 were less than $1,733. 14 Maximum income for optional methods........................................ 15 Enter the smaller of: two-thirds ( 2 /3) of gross farm income 1 (not less than zero) or $1,600. Also include this amount on line 4b above......................................... Nonfarm Optional Method. You may use this method only if (a) your net nonfarm profits 3 were less than $1,733 and also less than 72.189% of your gross nonfarm income 4 and (b) you had net earnings from self-employment of at least $400 in 2 of the prior 3 years. Caution. You may use this method no more than five times. 16 Subtract line 15 from line 14................................................ 17 Enter the smaller of: two-thirds ( 2 /3) of gross nonfarm income 4 (not less than zero) or the amount on line 16. Also include this amount on line 4b above................................... 1 From Sch. F, line 11, and Sch. K-1 (Form 1065), box 14, code B. 2 From Sch. F, line 36, and Sch. K-1 (Form 1065), box 14, code A. 5b 6 14 15 16 17 90,00 1,60 3 From Sch. C, line 31; Sch. C-EZ, line 3; Sch. K-1 (Form 1065), box 14, code A; and Sch. K-1 (Form 1065-B), box 9. 4 From Sch. C, line 7; Sch. C-EZ, line 1; Sch. K-1 (Form 1065), box 14, code C; and Sch. K-1 (Form 1065-B), box 9. Schedule SE (Form 1040) 2005

Form 4797 Department of the Treasury Internal Revenue Service (99) Name(s) shown on return Sales of Business Property (Also Involuntary Conversions and Recapture Amounts Under Sections 179 and 280F(b)(2)) Attach to your tax return. See separate instructions. OMB No. 1545-0184 2005 Attachment Sequence No. 27 Identifying number 1 Enter the gross proceeds from sales or exchanges reported to you for 2005 on Form(s) 1099-B or 1099-S (or substitute statement) that you are including on line 2, 10, or 20 (see instructions)....................................... 1 Part I Sales or Exchanges of Property Used in Trade or Business and Involuntary Conversions From Other Than Casualty or Theft Most Property Held More Than 1 Year (see instructions) 2 (e) Depreciation (f) Cost or other (a) Description (b) Date acquired (c) Date sold (d) Gross allowed or basis, plus of property (mo., day, yr.) (mo., day, yr.) sales price allowable since improvements and acquisition expense of sale (g) Gain or (loss) Subtract (f) from the sum of (d) and (e) 3 Gain, if any, from Form 4684, line 42.................................................................. 3 4 Section 1231 gain from installment sales from Form 6252, line 26 or 37...................................... 4 5 Section 1231 gain or (loss) from like-kind exchanges from Form 8824........................................ 5 6 Gain, if any, from line 32, from other than casualty or theft................................................. 6 7 Combine lines 2 through 6. Enter the gain or (loss) here and on the appropriate line as follows:................... 7 Partnerships (except electing large partnerships) and S corporations. Report the gain or (loss) following the instructions for Form 1065, Schedule K, line 10, or Form 1120S, Schedule K, line 9. Skip lines 8, 9, 11, and 12 below. Individuals, partners, S corporation shareholders, and all others. If line 7 is zero or a loss, enter the amount from line 7 on line 11 below and skip lines 8 and 9. If line 7 is a gain and you did not have any prior year section 1231 losses, or they were recaptured in an earlier year, enter the gain from line 7 as a long-term capital gain on the Schedule D filed with your return and skip lines 8, 9, 11, and 12 below. 8 Nonrecaptured net section 1231 losses from prior years (see instructions).................................... 8 9 Subtract line 8 from line 7. If zero or less, enter -0-. If line 9 is zero, enter the gain from line 7 on line 12 below. If line 9 is more than zero, enter the amount from line 8 on line 12 below and enter the gain from line 9 as a long-term capital gain on the Schedule D filed with your return (see instructions)............................................. 9 Part II Ordinary Gains and Losses (see instructions) 10 Ordinary gains and losses not included on lines 11 through 16 (include property held 1 year or less): 11 Loss, if any, from line 7............................................................................. 11 ( ) 12 Gain, if any, from line 7 or amount from line 8, if applicable................................................ 12 13 Gain, if any, from line 31............................................................................ 13 14 Net gain or (loss) from Form 4684, lines 34 and 41a...................................................... 14 15 Ordinary gain from installment sales from Form 6252, line 25 or 36.......................................... 15 16 Ordinary gain or (loss) from like-kind exchanges from Form 8824........................................... 16 17 Combine lines 10 through 16........................................................................ 17 18 For all except individual returns, enter the amount from line 17 on the appropriate line of your return and skip lines a and b below. For individual returns, complete lines a and b below: a If the loss on line 11 includes a loss from Form 4684, line 38, column (b)(ii), enter that part of the loss here. Enter the part of the loss from income-producing property on Schedule A (Form 1040), line 27, and the part of the loss from property used as an employee on Schedule A (Form 1040) line 22. Identify as from Form 4797, line 18a. See instructions...................................................................................... b Redetermine the gain or (loss) on line 17 excluding the loss, if any, on line 18a. Enter here and on Form 1040, line 14.......................................................................................... For Paperwork Reduction Act Notice, see separate instructions. Form 4797 (2005) 18a 18b ISA STF FED5267F.1

Form 4797 (2005) Page 2 Part III Gain From Disposition of Property Under Sections 1245, 1250, 1252, 1254, and 1255 (see instructions) 19 (a) Description of section 1245, 1250, 1252, 1254, or 1255 property: A B C D (b) Date acquired (mo., day, yr.) (c) Date sold (mo., day, yr.) Thesecolumnsrelatetothepropertiesonlines19A through19d. Property A Property B Property C Property D 20 Gross sales price (Note: See line 1 before completing.)..... 20 21 Cost or other basis plus expense of sale................. 21 22 Depreciation (or depletion) allowed or allowable........... 22 23 Adjusted basis. Subtract line 22 from line 21.............. 23 24 Total gain. Subtract line 23 from line 20.................. 24 25 If section 1245 property: a Depreciation allowed or allowable from line 22............ b Enter the smaller of line 24 or 25a..................... 26 If section 1250 property: If straight line depreciation was used, enter -0- on line 26g, except for a corporation subject to section 291. a Additional depreciation after 1975 (see instructions)........ b Applicable percentage multiplied by the smaller of line 24 or line 26a (see instructions)............................ c Subtract line 26a from line 24. If residential rental property or line 24 is not more than line 26a, skip lines 26d and 26e.... d Additional depreciation after 1969 and before 1976........ e Enter the smaller of line 26c or 26d..................... f Section 291 amount (corporations only)................. g Add lines 26b, 26e, and 26f........................... 27 If section 1252 property: Skip this section if you did not dispose of farmland or if this form is being completed for a partnership (other than an electing large partnership). a Soil, water, and land clearing expenses.................. b Line 27a multiplied by applicable percentage (see instructions) c Enter the smaller of line 24 or 27b..................... 28 If section 1254 property: a Intangible drilling and development costs, expenditures for development of mines and other natural deposits, and mining exploration costs (see instructions)..................... b Enter the smaller of line 24 or 28a..................... 29 If section 1255 property: a Applicable percentage of payments excluded from income under section 126 (see instructions).................... b Enter the smaller of line 24 or 29a (see instructions)....... 29b Summary of Part III Gains. Complete property columns A through D through line 29b before going to line 30. 30 Total gains for all properties. Add property columns A through D, line 24....................................... 30 31 Add property columns A through D, lines 25b, 26g, 27c, 28b, and 29b. Enter here and on line 13................... 31 STF FED5267F.2 25a 25b 26a 26b 26c 26d 26e 26f 26g 27a 27b 27c 28a 28b 29a 32 Subtract line 31 from line 30. Enter the portion from casualty or theft on Form 4684, line 36. Enter the portion from other than casualty or theft on Form 4797, line 6.............................................................. 32 Part IV Recapture Amounts Under Sections 179 and 280F(b)(2) When Business Use Drops to 50% or Less (see instructions) (a) Section (b) Section 179 280F(b)(2) 33 Section 179 expense deduction or depreciation allowable in prior years....................... 33 34 Recomputed depreciation (see instructions)............................................. 34 35 Recapture amount. Subtract line 34 from line 33. See the instructions for where to report......... 35 Form 4797 (2005)

1120 Form Department of the Treasury Internal Revenue Service A Check if: 1 Consolidated return (attach Form 851)... 2 Personal holding co. (attach Sch. PH)... 3 Personal service corp. (see instructions).... 4 Schedule M-3 required (attach Sch. M-3).... E Income Deductions (See instructions for limitations on deductions.) Tax and Payments Check if: U.S. Corporation Income Tax Return For calendar year 2005 or tax year beginning, 2005, ending, 20 See separate instructions. Use IRS label. Otherwise, print or type. Name Number, street, and room or suite no. If a P.O. box, see instructions. City or town, state, and ZIP code OMB No. 1545-0123 B Employer identification number C Date incorporated 1a Gross receipts or sales b Less returns and allowances c Bal 1c 2 Cost of goods sold (Schedule A, line 8)............................................. 2 3 Gross profit. Subtract line 2 from line 1c............................................ 3 4 Dividends (Schedule C, line 19)................................................... 4 5 Interest............................................................................ 5 6 Gross rents.................................................................... 6 7 Gross royalties.................................................................. 7 8 Capital gain net income (attach Schedule D (Form 1120))................................ 8 9 Net gain or (loss) from Form 4797, Part II, line 17 (attach Form 4797)....................... 9 10 Other income (see instructions attach schedule)...................................... 10 11 Total income. Add lines 3 through 10.............................................. 11 12 13 14 15 16 17 18 19 20a 21 22 23 24 25 26 27 b 28 29 Sign Here (1) Initial return (2) Final return (3) Name change (4) Address change Compensation of officers (Schedule E, line 4)......................................... Salaries and wages (less employment credits)......................................... Repairs and maintenance........................................................ Bad debts..................................................................... Rents............................................................................. Taxes and licenses............................................................. Interest........................................................................... Charitable contributions (see instructions for 10% limitation).............................. Depreciation (attach Form 4562)............................... 20a Less depreciation claimed on Schedule A and elsewhere on return...... 20b Depletion.......................................................................... Advertising......................................................................... Pension, profit-sharing, etc., plans................................................. Employee benefit programs....................................................... Other deductions (attach schedule)................................................ Total deductions. Add lines 12 through 26......................................... Taxable income before net operating loss deduction and special deductions. Subtract line 27 from line 11 Less: a Net operating loss deduction (see instructions)............ 29a b Special deductions (Schedule C, line 20)................. 29b D Total assets (see instructions) 30 Taxable income. Subtract line 29c from line 28 (see instructions if Schedule C, line 12, was completed) 30 31 Total tax (Schedule J, line 11).................................................. 31 32 Payments: a 2004 overpayment credited to 2005. 32a b 2005 estimated tax payments...... 32b c Less 2005 refund applied for on Form 4466 32c ( ) d Bal 32d e Tax deposited with Form 7004................................ 32e f Credits: (1) Form 2439 (2) Form 4136 32f 32g 33 Estimated tax penalty (see instructions). Check if Form 2220 is attached.............. 33 34 Tax due. If line 32g is smaller than the total of lines 31 and 33, enter amount owed............ 34 35 Overpayment.If line 32g is larger than the total of lines 31 and 33, enter amount overpaid....... 35 36 Enter amount of line 35 you want: Credited to 2006 estimated tax Refunded 36 Under penalties of perjury, I declare that I have examined this return, including accompanying schedules and statements, and to the best of my knowledge and belief, it is true, correct, and complete. Declaration of preparer (other than taxpayer) is based on all information of which preparer has any knowledge. May the IRS discuss this return with the preparer shown below (see instructions)? Yes No Paid Preparer s Use Only Domestic production activities deduction (attach Form 8903)............................. Signature of officer Preparer s signature Firm s name (or yours if self-employed), address, and ZIP code For Privacy Act and Paperwork Reduction Act Notice, see separate instructions. ISA STF FED3903F.1 Date Title Date Check if self-employed EIN $ Phone no. 12 13 14 15 16 17 18 19 20c 21 22 23 24 25 26 27 28 2005 Preparer s SSN or PTIN 29c Form 1120 (2005)

Form 1120 (2005) Schedule A 1 2 3 4 5 6 7 8 9a c d e STF FED3903F.2 Cost of Goods Sold (see instructions) Inventory at beginning of year.................................................. Purchases...................................................................... Cost of labor................................................................ Additional section 263A costs (attach schedule).................................... Other costs (attach schedule).................................................. Total. Add lines 1 through 5........................................................ Inventory at end of year....................................................... Cost of goods sold. Subtract line 7 from line 6. Enter here and on page 1, line 2............. Check all methods used for valuing closing inventory: (i) Cost (ii) Lower of cost or market (iii) Other (Specify method used and attach explanation.) Check if the LIFO inventory method was adopted this tax year for any goods (if checked, attach Form 970).............. If the LIFO inventory method was used for this tax year, enter percentage (or amounts) of closing inventory computed under LIFO................................................. If property is produced or acquired for resale, do the rules of section 263A apply to the corporation?........... f Was there any change in determining quantities, cost, or valuations between opening and closing inventory? If Yes, attach explanation......................................................................... Schedule C Dividends and Special Deductions (see instructions) (a) Dividends (b) % received 1 Dividends from less-than-20%-owned domestic corporations (other than debt-financed stock).............................................. 70 2 Dividends from 20%-or-more-owned domestic corporations (other than debt-financed stock)............................................................... 80 1 2 3 4 5 6 7 8 9d see instructions 3 Dividends on debt-financed stock of domestic and foreign corporations......... 4 Dividends on certain preferred stock of less-than-20%-owned public utilities..... 42 5 Dividends on certain preferred stock of 20%-or-more-owned public utilities...... 48 6 Dividends from less-than-20%-owned foreign corporations and certain FSCs..... 70 7 Dividends from 20%-or-more-owned foreign corporations and certain FSCs..... 80 8 Dividends from wholly owned foreign subsidiaries......................... 100 9 Total. Add lines 1 through 8. See instructions for limitation.................. 10 Dividends from domestic corporations received by a small business investment company operating under the Small Business Investment Act of 1958.......... 100 11 Dividends from affiliated group members and certain FSCs....................... 100 12 Dividends from controlled foreign corporations (attach Form 8895)............... 85 13 Dividends from foreign corporations not included on lines 3, 6, 7, 8, 11, or 12.... 14 Income from controlled foreign corporations under subpart F (attach Form(s) 5471) 15 Foreign dividend gross-up.......................................... 16 IC-DISC and former DISC dividends not included on lines 1, 2, or 3............. 17 Other dividends.................................................... 18 Deduction for dividends paid on certain preferred stock of public utilities........ 19 Total dividends.add lines 1 through 17. Enter here and on page 1, line 4...... 20 Total special deductions. Add lines 9, 10, 11, 12, and 18. Enter here and on page 1, line 29b.............. Schedule E Compensation of Officers (see instructions for page 1, line 12) Note: Complete Schedule E only if total receipts (line 1a plus lines 4 through 10 on page 1) are $500,000 or more. 1 b 2 3 4 Check if there was a writedown of subnormal goods...................................................... (a) Name of officer (b) Social security number (c) Percent of time devoted to business % % % % Percent of corporation stock owned (d) Common (e) Preferred Total compensation of officers..................................................... Compensation of officers claimed on Schedule A and elsewhere on return...................... Subtract line 3 from line 2. Enter the result here and on page 1, line 12........................ % % % % % % % % % % % Yes Yes Page 2 No No (c) Special deductions (a) 5 (b) (f) Amount of compensation Form 1120 (2005)

Form 1120 (2005) Schedule J 1 STF FED3903F.3 Tax Computation (see instructions) Check if the corporation is a member of a controlled group................................ Important: Members of a controlled group, see instructions. 2a If the box on line 1 is checked, enter the corporation s share of the $50,000, $25,000, and $9,925,000 taxable income brackets (in that order): (1) $ (2) $ (3) $ b Enter the corporation s share of: (1) Additional 5% tax (not more than $11,750) $ (2) Additional 3% tax (not more than $100,000) $ 3 Income tax. Check if a qualified personal service corporation (see instructions).................. 3 4 Alternative minimum tax (attach Form 4626)............................................. 4 5 Add lines 3 and 4........................................................................ 5 6a Foreign tax credit (attach Form 1118)................................ 6a b Possessions tax credit (attach Form 5735)............................ 6b c Credits from: Form 8834 Form 8907, line 23............ 6c d General business credit. Check box(es)and indicate which forms are attached: Form 3800 Form(s) (specify) 6d e Credit for prior year minimum tax (attach Form 8827).................... 6e f Bond credits from: Form 8860 Form 8912..................... 6f 7 Total credits. Add lines 6a through 6f................................................. 7 8 Subtract line 7 from line 5.................................................................. 8 9 Personal holding company tax (attach Schedule PH (Form 1120))............................... 9 10 Other taxes. Check if from: Form 4255 Form 8611 Form 8697 Form 8866 Form 8902 Other (attach schedule)... 10 11 Total tax. Add lines 8 through 10. Enter here and on page 1, line 31........................... 11 Schedule K Other Information (see instructions) 1 2 3 4 a b c Check accounting method: a Cash b Accrual c Other (specify) See the instructions and enter the: Business activity code no. Business activity Product or service At the end of the tax year, did the corporation own, directly or indirectly, 50% or more of the voting stock of a domestic corporation? (For rules of attribution, see section 267(c).)............................. If Yes, attach a schedule showing: (a) name and employer identification number (EIN), (b) percentage owned, and (c) taxable income or (loss) before NOL and special deductions of such corporation for the tax year ending with or within your tax year. Is the corporation a subsidiary in an affiliated group or a parent-subsidiary controlled group?.............. If Yes, enter name and EIN of the parent corporation 5 At the end of the tax year, did any individual, partnership, corporation, estate, or trust own, directly or indirectly, 50% or more of the corporation s voting stock? (For rules of attribution, see section 267(c).)............... If Yes, attach a schedule showing name and identifying number. (Do not include any information already entered in 4 above.) Enter percentage owned 6 Duringthis tax year,did the corporation pay dividends (other than stock dividends and distributions in exchange for stock) in excess of the corporation s current and accumulated earnings and profits? (See sections 301 and 316.)..... If Yes, file Form 5452, Corporate Report of Nondividend Distributions. If this is a consolidated return, answer here for the parent corporation and on Form 851, Affiliations Schedule, for each subsidiary. Yes No 7 8 9 10 11 c At any time during the tax year, did one foreign person own, directly or indirectly, at least 25% of (a) the total voting power of all classes of stock of the corporation entitled to vote or (b) the total value of all classes of stock of the corporation?.......................... If Yes, enter: (a) Percentage owned and (b) Owner s country The corporation may have to file Form 5472, Information Return of a 25% Foreign-Owned U.S. Corporation or a Foreign Corporation Engaged in a U.S. Trade or Business. Enter number of Forms 5472 attached Check this box if the corporation issued publicly offered debt instruments with original issue discount... If checked, the corporation may have to file Form 8281, Information Return for Publicly Offered Original Issue Discount Instruments. Enter the amount of tax-exempt interest received or accrued during the tax year $ Enter the number of shareholders at the end of the tax year (if 100 or fewer) If the corporation has an NOL for the tax year and is electing to forego the carryback period, check here If the corporation is filing a consolidated return, the statement required by Temporary Regulations section 1.1502-21T(b)(3) must be attached or the election will not be valid. 12 Enter the available NOL carryover from prior tax years (Do not reduce it by any deduction on line 29a.) $ 13 Are the corporation s total receipts (line 1a plus lines 4 through 10 on page 1) for the tax year and its total assets at the end of the tax year less than $250,000?...... If Yes, the corporation is not required to complete Schedules L, M-1, and M-2 on page 4. Instead, enter the total amount of cash distributions and the book value of property distributions (other than cash) made during the Page 3 Yes No tax year. $ Note: If the corporation, at any time during the tax year, had assets or operated a business in a foreign country or U.S. possession,it may be required to attach Schedule N (Form 1120), Foreign Operations of U.S. Corporations, to this return. See Schedule N for details. Form 1120 (2005)

Form 1120 (2005) Note: The corporation is not required to complete Schedules L, M-1, and M-2 if Question 13 on Schedule K is answered Yes. Schedule L Balance Sheets per Books Beginning of tax year End of tax year Assets (a) (b) (c) (d) 1 2a 3 4 5 6 7 8 9 b 10a b 11a 12 b 13a b 14 15 16 17 18 19 20 21 22 23 24 25 Cash............................... Trade notes and accounts receivable..... Less allowance for bad debts........... Inventories........................... U.S. government obligations............ Tax-exempt securities (see instructions)... Other current assets (attach schedule).... Loans to shareholders................ Mortgage and real estate loans......... Other investments (attach schedule)...... Buildings and other depreciable assets.... Less accumulated depreciation.......... Depletable assets.................... Less accumulated depletion............ Land (net of any amortization).......... Intangible assets (amortizable only)...... Less accumulated amortization.......... Other assets (attach schedule).......... Total assets........................ Liabilities and Shareholders Equity Accounts payable.................... Mortgages, notes,bonds payable in less than 1 year Other current liabilities (attach schedule).. Loans from shareholders.............. Mortgages, notes, bonds payable in 1 yearor more Other liabilities (attach schedule)........ Capital stock: a Preferred stock....... 26 Adjustments to shareholders equity (attach schedule) 27 Less cost of treasury stock............ ( ) ( ) 28 Total liabilities and shareholders equity... Schedule M-1 Reconciliation of Income (Loss) per Books With Income per Return (see instructions) 9 Add lines 7 and 8................ 6 Add lines 1 through 5.................. 10 Income (page 1, line 28) line 6 less line 9 Schedule M-2 Analysis of Unappropriated Retained Earnings per Books (Line 25, Schedule L) STF FED3903F.4 b Common stock....... Additional paid-in capital.............. Retained earnings Appropriated (attach schedule) Retained earnings Unappropriated...... ( ) 1 Net income (loss) per books............ 7 Income recorded on books this year not 2 Federal income tax per books.......... included on this return (itemize): 3 Excess of capital losses over capital gains. Tax-exempt interest $ 4 Income subject to tax not recorded on books this year (itemize): 5 Expenses recorded on books this year not deducted on this return (itemize): a Depreciation $ b Charitable contributions $ c Travel and entertainment $ ( ) ( ) ( ) ( ) ( ) ( ) ( ) 8 Deductions on this return not charged against book income this year (itemize): a Depreciation.......... $ b Charitable contributions $ 1 Balance at beginning of year........... 5 Distributions: a Cash........... 2 Net income (loss) per books............ b Stock.......... 3 Other increases (itemize): c Property........ 6 Other decreases (itemize): 7 Add lines 5 and 6................ 4 Add lines 1, 2, and 3.................. 8 Balance at end of year (line 4 less line 7) Page 4 Form 1120 (2005)

Form 1120S ISA STF FED4219F.1 U.S. Income Tax Return for an S Corporation Do not file this form unless the corporation has filed Form 2553 to elect to be an S corporation. Department of the Treasury Internal Revenue Service See separate instructions. For calendar year 2005, or tax year beginning, 2005, ending, 20 A B Effective date of S election Business code number (see instructions) Use the IRS label. Otherwise, print or type. Name Number, street, and room or suite no. If a P.O. box, see instructions. City or town, state, and ZIP code OMB No. 1545-0130 C Employer identification number D Date incorporated E Total assets (see instructions) F Check applicable boxes: (1) Initial return (2) Final return (3) Name change (4) Address change (5) Amended return G Enter number of shareholders in the corporation at end of the tax year............................... Caution. Include only trade or business income and expenses on lines 1a through 21. See the instructions for more information. Income Deductions (see the instructions for limitations) Tax and Payments Sign Here 1a Gross receipts or sales b Less returns and allowances c Bal 1c 2 Cost of goods sold (Schedule A, line 8)........................................ 2 3 Gross profit. Subtract line 2 from line 1c...................................... 3 4 Net gain (loss) from Form 4797, Part II, line 17 (attach Form 4797).................... 4 5 Other income (loss) (attach statement)...................................... 5 6 Total income (loss).add lines 3 through 5....................................... 6 7 Compensation of officers.................................................. 7 8 Salaries and wages (less employment credits)................................... 8 9 Repairs and maintenance.................................................. 9 10 Bad debts......................................................... 10 11 Rents..................................................................... 11 12 Taxes and licenses....................................................... 12 13 Interest...................................................................... 13 14a Depreciation (attach Form 4562)......................... 14a b Depreciation claimed on Schedule A and elsewhere on return... 14b c Subtract line 14b from line 14a............................................. 14c 15 Depletion (Do not deduct oil and gas depletion.)................................ 15 16 Advertising................................................................... 16 17 Pension, profit-sharing, etc., plans............................................ 17 18 Employee benefit programs................................................. 18 19 Other deductions (attach statement)........................................ 19 20 Total deductions. Add the amounts shown in the far right column for lines 7 through 19 20 21 Ordinary businessincome (loss).subtract line 20 from line 6......................... 21 22 Tax: a Excess net passive income tax (attach statement)...... 22a b Tax from Schedule D (Form 1120S)...................... 22b c Add lines 22a and 22b (see the instructions for additional taxes)..................... 22c 23 Payments: a 2005 estimated tax payments and amount applied from 2004 return 23a b Tax deposited with Form 7004.......................... 23b c Credit for Federal tax paid on fuels (attach Form 4136)........ 23c d Add lines 23a through 23c................................................. 23d 24 Estimated tax penalty (see instructions). Check if Form 2220 is attached............ 24 25 Tax due. If line 23d is smaller than the total of lines 22c and 24, enter amount owed....... 25 26 Overpayment. If line 23d is larger than the total of lines 22c and 24, enter amount overpaid 26 27 Enter amount of line 26 you want: Credited to 2006 estimated tax Refunded 27 Paid Preparer s Use Only Under penalties of perjury, I declare that I have examined this return, including accompanying schedules and statements, and to the best of my knowledge and belief, it is true, correct, and complete. Declaration of preparer (other than taxpayer) is based on all information of which preparer has any knowledge. May the IRS discuss this return with the preparer shown below (see instructions)? Yes No Signature of officer Date Title Preparer s signature Firm s name (or yours if self-employed), address, and ZIP code For Privacy Act and Paperwork Reduction Act Notice, see the separate instructions. Form 1120S (2005) Date Check if self-employed EIN $ Phone no. 2005 Preparer s SSN or PTIN

Form 1120S (2005) Page 2 Schedule A STF FED4219F.2 Cost of Goods Sold (see instructions) 1 Inventory at beginning of year.................................................. 2 Purchases....................................................................... 3 Cost of labor.............................................................. 4 Additional section 263A costs (attach statement).................................... 5 Other costs (attach statement).................................................. 6 Total. Add lines 1 through 5........................................................ 7 Inventory at end of year...................................................... 8 Cost of goods sold.subtract line 7 from line 6. Enter here and on page 1, line 2............. 9a Check all methods used for valuing closing inventory: (i) Cost as described in Regulations section 1.471-3 (ii) Lower of cost or market as described in Regulations section 1.471-4 (iii) Other (specify method used and attach explanation) b Check if there was a writedown of subnormal goods as described in Regulations section 1.471-2(c)................. c Check if the LIFO inventory method was adopted this tax year for any goods (if checked, attach Form 970)........... d If the LIFO inventory method was used for this tax year, enter percentage (or amounts) of closing inventory computed under LIFO............................................... 9d e If property is produced or acquired for resale, do the rules of Section 263A apply to the corporation?.......... f Was there any change in determining quantities, cost, or valuations between opening and closing inventory?.... If Yes, attach explanation. Schedule B Other Information (see instructions) 1 2 3 4 5 Check method of accounting: (a) Cash (b) Accrual (c) Other (specify) See the instructions and enter the: (a) Business activity (b) Product or service At the end of the tax year, did the corporation own, directly or indirectly, 50% or more of the voting stock of a domestic corporation? (For rules of attribution, see section 267(c).) If Yes, attach a statement showing: (a) name, address, and employer identification number and (b) percentage owned........................................ Was the corporation a member of a controlled group subject to the provisions of section 1561?............... Has this corporation filed, or is it required to file, a return under section 6111 to provide information on any reportable transaction?.......................................................................................... 6 Check this box if the corporation issued publicly offered debt instruments with original issue discount.... If checked, the corporation may have to file Form 8281, Information Return for Publicly Offered Original Issue Discount Instruments. 7 If the corporation: (a) was a C corporation before it elected to be an S corporation or the corporation acquired an asset with a basis determined by reference to its basis (or the basis of any other property) in the hands of a C corporation and (b) has net unrealized built-in gain (defined in section 1374(d)(1))in excess of the net recognized built-in gain from prior years, enter the net unrealized built-in gain reduced by net recognized built-in gain from prior years.......................................... $ 8 Check this box if the corporation had accumulated earnings and profits at the close of the tax year...... 9 Are the corporation s total receipts (see instructions) for the tax year and its total assets at the end of the tax year less than $250,000? If Yes, the corporation is not required to complete Schedules L and M-1. Note: If the corporation had assets or operated a business in a foreign country or U.S. possession, it may be required to attach Schedule N (Form 1120), Foreign Operations of U.S. Corporations, to this return. See Schedule N for details. Schedule K Shareholders Shares of Income, Deductions, Credits, etc. Shareholders Pro Rata Share Items Total amount Income (Loss) 1 Ordinary business income (loss) (page 1, line 21).............................. 1 2 Net rental real estate income (loss) (attach Form 8825).......................... 2 3a Other gross rental income (loss).................... 3a b Expenses from other rental activities (attach statement)... 3b c Other net rental income (loss). Subtract line 3b from line 3a...................... 3c 4 Interest income....................................................... 4 5 Dividends: a Ordinary dividends........................................... 5a b Qualified dividends.................. 5b 6 Royalties.................................................................. 6 7 Net short-term capital gain (loss) (attach Schedule D (Form 1120S))................. 7 8a Net long-term capital gain (loss) (attach Schedule D (Form 1120S))................. 8a b Collectibles (28%) gain (loss)...................... 8b c Unrecaptured section 1250 gain (attach statement)...... 8c 9 Net section 1231 gain (loss) (attach Form 4797)......................................... 9 10 Other income (loss) (see instructions)...... Type 10 1 2 3 4 5 6 7 8 Yes Yes Yes No No No Form 1120S (2005)

Form 1120S (2005) Page 3 Deductions Credits & Credit Recapture Foreign Transactions Alternative Minimum Tax (AMT) Items Items Affecting Shareholder Basis Other Information Shareholders Pro Rata Share Items (continued) 11 Section 179 deduction (attach Form 4562)................................... 12a Contributions.............................................................. b Investment interest expense............................................. c Section 59(e)(2) expenditures (1) Type (2) Amount d Other deductions (see instructions)......... Type 13a Low-income housing credit (section 42(j)(5)).................................. b Low-income housing credit (other)......................................... c Qualified rehabilitation expenditures (rental real estate) (attach Form 3468)............ d Other rental real estate credits (see instructions).. Type e Other rental credits (see instructions)........ Type f Credit for alcohol used as fuel (attach Form 6478)............................. g Other credits and credit recapture (see instructions) Type 14a Name of country or U.S. possession b Gross income from all sources........................................... c Gross income sourced at shareholder level.................................. Foreign gross income sourced at corporate level: d Passive................................................................. e Listed categories (attach statement)..................................... f General limitation.................................................. Deductions allocated and apportioned at shareholder level: g Interest expense...................................................... h Other..................................................................... Deductions allocated and apportioned at corporate level to foreign source income: i Passive................................................................. j Listed categories (attach statement)........................................ k General limitation.................................................. Other information: l Total foreign taxes (check one): Paid Accrued....................... m Reduction in taxes available for credit (attach statement)......................... n Other foreign tax information (attach statement)............................. 15a Post-1986 depreciation adjustment....................................... b Adjusted gain or loss.................................................. c Depletion (other than oil and gas)......................................... d Oil, gas, and geothermal properties gross income............................. e Oil, gas, and geothermal properties deductions............................... f Other AMT items (attach statement)..................................... 16a Tax-exempt interest income............................................. b Other tax-exempt income............................................... c Nondeductible expenses................................................ d Property distributions.................................................. e Repayment of loans from shareholders..................................... 17a Investment income.................................................... b Investment expenses................................................... c Dividend distributions paid from accumulated earnings and profits................. d Other items and amounts (attach statement)................................... e Income/loss reconciliation. (Required only if Schedule M-1 must be completed.) Combine the amounts on lines 1 through 10 in the far right column. From the result, subtract the sum of the amounts on lines 11 through 12d and 14l........................... 11 12a 12b 12c(2) 12d 13a 13b 13c 13d 13e 13f 13g 14b 14c 14d 14e 14f 14g 14h 14i 14j 14k 14l 14m 15a 15b 15c 15d 15e 15f 16a 16b 16c 16d 16e 17a 17b 17c 17e Total amount Form 1120S (2005) STF FED4219F.3

Form 1120S (2005) Page 4 Note: The corporation is not required to complete Schedules L and M-1 if question 9 of Schedule B is answered Yes. Schedule L Balance Sheets per Books Beginning of tax year End of tax year Assets 1 Cash............................... 2a Trade notes and accounts receivable.... b Less allowance for bad debts.......... 3 Inventories.......................... 4 U.S. government obligations........... 5 Tax-exempt securities.............. 6 Other current assets (attach statement)... 7 Loans to shareholders............... 8 Mortgage and real estate loans......... 9 Other investments (attach statement).... 10a Buildings and other depreciable assets... b Less accumulated depreciation........ 11a Depletable assets................... b Less accumulated depletion........... 12 Land (net of any amortization).......... 13a Intangible assets (amortizable only)...... b Less accumulated amortization......... 14 Other assets (attach statement)........ 15 Total assets....................... Liabilities and Shareholders Equity 16 Accounts payable................... 17 Mortgages, notes, bonds payable in less than 1 year 18 Other current liabilities (attach statement) 19 Loans from shareholders............. 20 Mortgages, notes, bonds payable in 1 year or more 21 Other liabilities (attach statement)....... 22 Capital stock...................... 23 Additional paid-in capital............. 24 Retained earnings................... 25 Adjustments to shareholders equity (attach statement) 26 Less cost of treasury stock............ 27 Total liabilities and shareholders equity..... Schedule M-1 (b) (c) ( ) ( ) Reconciliation of Income (Loss) per Books With Income (Loss) per Return 1 Net income (loss) per books........... 5 Income recorded on books this year not included 2 Income included on Schedule K, lines 1, 2, 3c, 4, on Schedule K, lines 1 through 10 (itemize): 5a, 6, 7, 8a, 9, and 10, not recorded on books this a Tax-exempt interest $ year (itemize): 3 Expenses recorded on books this year not included on Schedule K, lines 1 through 12 and 14l (itemize): 6 Deductions included on Schedule K, lines 1 through 12 and 14l, not charged against book income this year (itemize): (a) a Depreciation $ a Depreciation $ b Travel and entertainment $ 7 Add lines 5 and 6................. 4 Add lines 1 through 3.............. 8 Income (loss) (Schedule K, line 17e). Line 4 less line 7 Schedule M-2 Analysisof Accumulated Adjustments Account, Other Adjustments Account, and Shareholders Undistributed Taxable Income PreviouslyTaxed (see instructions) (a) Accumulated adjustments account (b) Other adjustments account (d) (c) Shareholders undistributed taxable income previously taxed 1 Balance at beginning of tax year......... 2 Ordinary income from page 1, line 21..... 3 Other additions..................... 4 Loss from page 1, line 21.............. ( 5 Other reductions................... ( 6 Combine lines 1 through 5.............. 7 Distributions other than dividend distributions 8 Balance at end of tax year.subtract line 7 from line 6 ) ) ( ) Form 1120S (2005) STF FED4219F.4

Schedule K-1 (Form 1120S) Department of the Treasury Internal Revenue Service year beginning, 2005 ending Shareholder s Share of Income, Deductions, Credits, etc. Part I For calendar year 2005, or tax Information About the Corporation 2005, 20 See back of form and separate instructions. Final K-1 Amended K-1 Part III OMB No. 1545-0130 Shareholder s Share of Current Year Income, Deductions, Credits, and Other Items 1 Ordinary business income (loss) 2 Net rental real estate income (loss) 3 Othernet rentalincome (loss) 4 Interest income 13 Credits & credit recapture 671105 A Corporation s employer identification number 5a Ordinary dividends B Corporation s name, address, city, state, and ZIP code 5b Qualified dividends 14 Foreign transactions 6 Royalties 7 Net short-term capital gain (loss) C IRS Center where corporation filed return 8a Net long-term capital gain (loss) D Tax shelter registration number, if any 8b Collectibles (28%) gain (loss) E Check if Form 8271 is attached 8c Unrecaptured section 1250 gain Part II Information About the Shareholder F Shareholder s identifying number G Shareholder s name, address, city, state and ZIP code 9 Net section 1231 gain (loss) 10 Other income (loss) 15 Alternative minimum tax (AMT) items H Shareholder s percentage of stock ownership for tax year.................. % 11 Section 179 deduction 16 Items affecting shareholder basis 12 Other deductions For IRS Use Only 17 Other information * See attached statement for additional information. For Privacy Act and Paperwork Reduction Act Notice, see Instructions for Form 1120S. Schedule K-1 (Form 1120S) 2005 ISA STF FED4269F.1

Schedule K-1 (Form 1120S) 2005 Page 2 This list identifies the codes used on Schedule K-1 for all shareholders and provides summarized reporting information for shareholders who file Form 1040. For detailed reporting and filing information, see the separate Shareholder s Instructions for Schedule K-1and the instructions for your income tax return. Code Enter on 1. 2. Ordinary business income (loss). You must first determine whether the income (loss) is passive or nonpassive. Then enter on your return as follows: Enter on Passive loss See the Shareholder s Instructions Passive income Schedule E, line 28, column (g) Nonpassive loss Schedule E, line 28, column (h) Nonpassive income Schedule E, line 28, column (j) Net rental real estate income (loss) 3. Other net rental income (loss) Net income Net loss 4. Interest income See the Shareholder s Instructions Schedule E, line 28, column (g) See the Shareholder s Instructions Form 1040, line 8a 5a. Ordinary dividends Form 1040, line 9a M Empowerment zone and renewal community employment credit Form 8844, line 3 N Credit for increasing research activities Form 6765, line 42 O New markets credit P Credit for employer social security and Medicare taxes Q Backup withholding R Recapture of low-income housing credit (section 42(j)(5)) S Recapture of low-income housing credit (other) T Recapture of investment credit U Other credits V Recapture of other credits Form 8874, line 2 Form 8846, line 5 Form 1040, line 64 Form 8611, line 8 Form 8611, line 8 See Form 4255 See the Shareholder s Instructions See the Shareholder s Instructions 5b. Qualified dividends Form 1040, line 9b 14. Foreign transactions A Name of country oru.s. 6. Royalties Schedule E, line 4 possession Form 1116, Part I 7. Net short-term capital gain (loss) Schedule D, line 5, column (f) B Gross income from all sources Form 1116, Part I 8a. Net long-term capital gain (loss) Schedule D, line 12, column (f) C Gross income sourced at shareholder level Form 1116, Part I 8b. Collectibles (28%) gain (loss) 28% Rate Gain Worksheet, line 4 Foreign gross income sourced at corporate level (Schedule D instructions) D Passive Form 1116, Part l 8c. Unrecaptured section 1250 gain See the Shareholder s Instructions E Listed categories Form 1116, Part I F General limitation Form 1116, Part I 9. Net section 1231 gain (loss) See the Shareholder s Instructions Deductions allocated and apportioned at shareholder level 10. Other income (loss) G Interest expense Form 1116, Part I Code H Other Form 1116, Part I A Other portfolio income (loss) See the Shareholder s Instructions Deductions allocated and apportioned at corporate level to foreign source B Involuntary conversions See the Shareholder s Instructions income C Sec. 1256 contracts & straddles Form 6781, line 1 I Passive Form 1116, Part I D Mining exploration costs recapture See Pub. 535 J Listed categories Form 1116, Part I E Other income (loss) See the Shareholder s Instructions K General limitation Form 1116, Part I 11. Section 179 deduction See the Shareholder s Instructions Other information L Total foreign taxes paid Form 1116, Part II 12. Other deductions M Total foreign taxes accrued Form 1116, Part II A Cash contributions (50%) Schedule A, line 15a N Reduction in taxes available for B Cash contributions (30%) Schedule A, line 15a credit Form 1116, line 12 C Noncash contributions (50%) Schedule A, line 16 O Foreign trading gross receipts Form 8873 D Noncash contributions (30%) Schedule A, line 16 P Extraterritorial income exclusion Form 8873 E Capital gain property to a 50% Q Other foreign transactions See the Shareholder s Instructions organization (30%) Schedule A, line 16 F Capital gain property (20%) Schedule A, line 16 15. Alternative minimum tax (AMT) items G Cash contributions (100%) See the Shareholder s Instructions A Post-1986 depreciation adjustment } H Investment interest expense Form 4952, line 1 B Adjusted gain or loss See the Shareholder s I Deductions royalty income Schedule E, line 18 C Depletion (other than oil & gas) Instructions and J Section 59(e)(2) expenditures See the Shareholder s Instructions D Oil, gas, & geothermal gross income the Instructions for K Deductions portfolio (2% floor) Schedule A, line 22 E Oil, gas, & geothermal deductions Form 6251 L Deductions portfolio (other) Schedule A, line 27 F Other AMT items M Reforestation expense 16. Items affecting shareholder basis deduction See the Shareholder s Instructions A Tax-exempt interest income Form 1040, line 8b N Preproductive period expenses See the Shareholder s Instructions B Other tax-exempt income See the Shareholder s Instructions O Commercial revitalization C Nondeductible expenses See the Shareholder s Instructions deduction from rental real D Property distributions See the Shareholder s Instructions estate activities See Form 8582 Instructions E Repayment of loans from P Domestic production activities shareholders See the Shareholder s Instructions information See Form 8903 Instructions Q Qualified production activities 17. Other information income Form 8903, line 7 A Investment income Form 4952, line 4a R Employer s W-2 wages Form 8903, line 13 B Investment expenses Form 4952, line 5 S Other deductions See the Shareholder s Instructions C Look-back interest completed long-term contracts See Form 8697 13. Credits & credit recapture D Look-back interest income forecast A Low-income housing credit method } See Form 8866 (section 42(j)(5)) Form 8586, line 4 E Dispositions of property with B Low-income housing credit (other) Form 8586, line 4 section 179 deductions C Qualified rehabilitation F Recapture of section 179 expenditures (rental real estate) Form 3468, line 1 deduction D Qualified rehabilitation G Section 453(l)(3) information expenditures (other than rental H Section 453A(c) information real estate) Form 3468, line 1 I Section 1260(b) information E Basis of energy property See the Shareholder s Instructions J Interest allocable to production See the Shareholder s Instructions F Other rental real estate credits See the Shareholder s Instructions expenditures G Other rental credits See the Shareholder s Instructions K CCF nonqualified withdrawal H Undistributed capital gains credit Form 1040, line 70, check box a L Information needed to figure I Credit for alcohol used as fuel Form 6478, line 4 depletion oil and gas J Work opportunity credit Form 5884, line 3 M Amortization of reforestation K Welfare-to-work credit Form 8861, line 3 costs L Disabled access credit Form 8826, line 7 N Other information STF FED4269F.2

1065 Form Department of the Treasury Internal Revenue Service A Principal business activity B Principal product or service C Business code number U.S. Return of Partnership Income For calendar year 2005, or tax year beginning, 2005, ending, 20. See separate instructions. Use the IRS label. Otherwise, print or type. Name of partnership Number, street, and room or suite no. If a P.O. box, see the instructions. City or town, state, and ZIP code OMB No. 1545-0099 2005 D Employer identification number E Date business started F Total assets (see the instructions) $ G Check applicable boxes: (1) Initial return (2) Final return (3) Name change (4) Address change (5) Amended return H Check accounting method: (1) Cash (2) Accrual (3) Other (specify) I Number of Schedules K-1. Attach one for each person who was a partner at any time during the tax year Caution. Include only trade or business income and expenses on lines 1a through 22 below. See the instructions for more information. 1a Gross receipts or sales.............................. 1a b Less returns and allowances........................... 1b 1c Income 2 Cost of goods sold (Schedule A, line 8)...................................... 3 Gross profit. Subtract line 2 from line 1c..................................... 4 Ordinary income (loss) from other partnerships, estates, and trusts (attach statement).... 5 Net farm profit (loss) (attach Schedule F (Form 1040))............................. 6 Net gain (loss) from Form 4797, Part II, line 17 (attach Form 4797).................. 2 3 4 5 6 7 Other income (loss) (attach statement)............................................ 7 Deductions (see the instructions for limitations) 8 Total income (loss). Combine lines 3 through 7................................ 8 9 Salaries and wages (other than to partners) (less employment credits)................ 9 10 Guaranteed payments to partners.......................................... 10 11 Repairs and maintenance................................................ 11 12 Bad debts........................................................... 12 13 Rent....................................................................... 13 14 Taxes and licenses................................................... 14 15 Interest..................................................................... 15 16a Depreciation (if required, attach Form 4562)............... 16a b Less depreciation reported on Schedule A and elsewhere on return 16b 16c 17 Depletion (Do not deduct oil and gas depletion.).............................. 17 18 Retirement plans, etc.................................................... 18 19 Employee benefit programs............................................. 19 20 Other deductions (attach statement)............................................. 20 21 Total deductions. Add the amounts shown in the far right column for lines 9 through 20.. 21 22 Sign Here Paid Preparer s Use Only ISA STF FED3361F.1 Ordinary business income (loss). Subtract line 21 from line 8...................... Under penalties of perjury, I declare that I have examined this return, including accompanying schedules and statements, and to the best of my knowledge and belief, it is true, correct, and complete. Declaration of preparer (other than general partner or limited liability company member) is based on all information of which preparer has any knowledge. Preparer s signature Signature of general partner or limited liability company member manager Firm s name (or yours if self-employed), address, and ZIP code For Privacy Act and Paperwork Reduction Act Notice, see separate instructions. Date Date Check if self-employed EIN Phone no. 22 May the IRS discuss this return with the preparer shown below (see instructions)? Yes No Preparer s SSN or PTIN Form 1065 (2005)

Form 1065 (2005) Page 2 Schedule A Cost of Goods Sold (see the instructions) 1 Inventory at beginning of year............................................... 1 2 Purchases less cost of items withdrawn for personal use............................ 2 3 Cost of labor............................................................ 3 4 Additional section 263A costs (attach statement)....................................... 4 5 Other costs (attach statement)..................................................... 5 6 Total. Add lines 1 through 5...................................................... 6 7 Inventory at end of year................................................... 7 8 Cost of goods sold. Subtract line 7 from line 6. Enter here and on page 1, line 2........... 8 9a Check all methods used for valuing closing inventory: (i) Cost as described in Regulations section 1.471-3 (ii) Lower of cost or market as described in Regulations section 1.471-4 (iii) Other (specify method used and attach explanation) b Check this box if there was a writedown of subnormal goods as described in Regulations section 1.471-2(c)....... c Check this box if the LIFO inventory method was adopted this tax year for any goods (if checked, attach Form 970).. d Do the rules of section 263A (for property produced or acquired for resale) apply to the partnership?..... Yes e Was there any change in determining quantities, cost, or valuations between opening and closing inventory? Yes If Yes, attach explanation. Schedule B Other Information 1 What type of entity is filing this return? Check the applicable box: Yes a Domestic general partnership b Domestic limited partnership c Domestic limited liability company d Domestic limited liability partnership e Foreign partnership f Other 2 Are any partners in this partnership also partnerships?.......................................... 3 4 During the partnership s tax year, did the partnership own any interest in another partnership or in any foreign entity that was disregarded as an entity separate from its owner under Regulations sections 301.7701-2 and 301.7701-3? If yes, see instructions for required attachment..................................... Did the partnership file Form 8893, Election of Partnership Level Tax Treatment, or an election statement under section 6231(a)(1)(B)(ii) for partnership-level tax treatment, that is in effect for this tax year? See Form 8893 for more details.................................................................... 5 Does this partnership meet all three of the following requirements? a The partnership s total receipts for the tax year were less than $250,000; b The partnership s total assets at the end of the tax year were less than $600,000; and c Schedules K-1 are filed with the return and furnished to the partners on or before the due date (including extensions) for the partnership return. If Yes, the partnership is not required to complete Schedules L, M-1, and M-2; Item F on page 1 of Form 1065; or Item N on Schedule K-1.............................................................. 6 Does this partnership have any foreign partners? If Yes, the partnership may have to file Forms 8804, 8805 and 8813. See the instructions............................................................... 7 Is this partnership a publicly traded partnership as defined in section 469(k)(2)?........................ 8 Has this partnership filed, or is it required to file,a return under section 6111 to provide information on any reportable transaction?.................................................................................. 9 At any time during calendar year 2005, did the partnership have an interest in or a signature or other authority over afinancial account in a foreign country (suchasa bank account, securities account, or other financial account)? See the instructions for exceptions and filing requirements for Form TD F 90-22.1. If Yes, enter the name of the foreign country. 10 During the tax year, did the partnership receive a distribution from, or was it the grantor of, or transferor to, a foreign trust? If Yes, the partnership may have to file Form 3520. See the instructions................... 11 Was there a distribution of property or a transfer (for example, by sale or death) of a partnership interest during the tax year? If Yes, you may elect to adjust the basis of the partnership s assets under section 754 by attaching the statement described under Elections Made By the Partnership in the instructions.................... 12 Enter the number of Forms 8865, Return of U.S. Persons With Respect to Certain Foreign Partnerships, attached to this return........................................................... Designation of Tax Matters Partner (see the instructions) Enter below the general partner designated as the tax matters partner (TMP) for the tax year of this return: Name of designated TMP Address of designated TMP STF FED3361F.2 Identifying number of TMP No No No Form 1065 (2005)

Form 1065 (2005) Schedule K Income (Loss) Deductions Self- Employment Credits & Credit Recapture Foreign Transactions Alternative Minimum Tax (AMT) Items Other Information Partners Distributive Share Items 1 Ordinary business income (loss)(page 1, line 22)................................ 1 2 Net rental real estate income (loss) (attach Form 8825).............................. 2 3a Other gross rental income (loss)........................ 3a b Expenses from other rental activities (attach statement)....... 3b c Other net rental income (loss). Subtract line 3b from line 3a......................... 3c 4 Guaranteed payments.................................................... 4 5 Interest income......................................................... 5 6 Dividends: a Ordinary dividends............................................ 6a b Qualified dividends....................... 6b 7 Royalties............................................................. 7 8 Net short-term capital gain (loss) (attach Schedule D (Form 1065)).................... 8 9a Net long-term capital gain (loss) (attach Schedule D (Form 1065))..................... 9a b Collectibles (28%) gain (loss).......................... 9b c Unrecaptured section 1250 gain (attach statement)........... 9c 10 Net section 1231 gain (loss) (attach Form 4797)................................. 10 11 Other income (loss) (see instructions) Type 11 12 Section 179 deduction (attach Form 4562)..................................... 12 13a Contributions................................................................. 13a b Investment interest expense................................................ 13b c Section 59(e)(2) expenditures: (1) Type (2) Amount 13c(2) d Other deductions (see instructions) Type 13d 14a Net earnings (loss) from self-employment...................................... b Gross farming or fishing income............................................. c Gross nonfarm income................................................... 15a Low-income housing credit (section 42(j)(5)).................................... b Low-income housing credit (other)........................................... c Qualified rehabilitation expenditures (rental real estate) (attach Form 3468).............. d Other rental real estate credits (see instructions) Type e Other rental credits (see instructions) Type f Other credits and credit recapture (see instructions) Type 16a Name of country or U.S. possession b Gross income from all sources.............................................. c Gross income sourced at partner level........................................ Foreign gross income sourced at partnership level d Passive e Listed categories (attach statement) f General limitation Deductions allocated and apportioned at partner level g Interest expense h Other............................. 17a Post-1986 depreciation adjustment.......................................... b Adjusted gain or loss..................................................... c Depletion (other than oil and gas)........................................... d Oil, gas, and geothermal properties gross income............................... e Oil, gas, and geothermal properties deductions................................. f Other AMT items (attach statement)....................................... 14a 14b 14c 15a 15b 15c 15d 15e 15f Deductions allocated and apportioned at partnership level to foreign source income i Passive j Listed categories (attach statement) k General limitation 16k l Total foreign taxes (check one): Paid Accrued........................ 16l m Reduction in taxes available for credit (attach statement)........................... 16m n Other foreign tax information (attach statement)..................................... 18a Tax-exempt interest income................................................ b c Other tax-exempt income................................................. Nondeductible expenses.................................................. 19a Distributions of cash and marketable securities.................................. b Distributions of other property.............................................. 20a Investment income....................................................... b Investment expenses..................................................... c Other items and amounts (attach statement).................................... 16b 16c 16f 16h 17a 17b 17c 17d 17e 17f 18a 18b 18c 19a 19b 20a 20b Total amount Page 3 Form 1065 (2005) STF FED3361F.3

Form 1065 (2005) Analysis of Net Income (Loss) 1 Net income (loss). Combine Schedule K, lines 1 through 11. From the result, subtract the sum of Schedule K, lines 12 through 13d, and 16l........................................ 1 2 Analysis by (ii) Individual (iii) Individual (v) Exempt partner type: (active) (passive) (iv) Partnership organization (vi) Nominee/Other a General partners b Limited partners Note: Schedules L, M-1, and M-2 are not required if Question 5 of Schedule B is answered Yes. Schedule L Balance Sheets per Books Beginning of tax year End of tax year Assets (a) (b) (c) (d) 1 Cash................................... 2a Trade notes and accounts receivable........ b Less allowance for bad debts............. 3 Inventories.............................. 4 U.S. government obligations.............. 5 Tax-exempt securities................... 6 Other current assets (attach statement)...... 7 Mortgage and real estate loans............ 8 Other investments (attach statement)........ 9a Buildings and other depreciable assets....... b Less accumulated depreciation............ 10a Depletable assets...................... b Less accumulated depletion.............. 11 Land (net of any amortization)............. 12a Intangible assets (amortizable only)......... b Less accumulated amortization............ 13 Other assets (attach statement)............ 14 Total assets............................. Liabilities and Capital 15 Accounts payable...................... 16 Mortgages, notes, bonds payable in less than 1 year 17 Other current liabilities (attach statement)..... 18 All nonrecourse loans................... 19 Mortgages, notes, bonds payable in 1 year or more 20 Other liabilities (attach statement).......... 21 Partners capital accounts............... 22 Total liabilities and capital.................. Schedule M-1 Reconciliation of Income (Loss) per Books With Income (Loss) per Return 1 Net income (loss) per books........ 2 Income included on Schedule K, lines 1, 2, 3c, 5, 6a, 7, 8, 9a, 10, and 11, not recorded on books this year (itemize): 3 Guaranteed payments (other than health insurance)....................... 4 Expenses recorded on books this year not included on Schedule K, lines 1 through 13d, and 16l (itemize): a Depreciation $ b Travel and entertainment $ 5 Add lines 1 through 4.............. Schedule M-2 Analysis of Partners Capital Accounts 1 Balance at beginning of year....... 2 Capital contributed: a Cash......... b Property....... 3 Net income (loss) per books........ 4 Other increases (itemize): 5 Add lines 1 through 4.............. STF FED3361F.4 6 Income recorded on books this year not included on Schedule K, lines 1 through 11 (itemize): a Tax-exempt interest $ 7 Deductions included on Schedule K, lines 1 through 13d, and 16l, not charged against book income this year (itemize): a Depreciation $ 8 Add lines 6 and 7..................... 9 Income (loss) (Analysis of Net Income (Loss), line 1). Subtract line 8 from line 5.......... 6 Distributions: a Cash................ b Property.............. 7 Other decreases (itemize): 8 Add lines 6 and 7.................... 9 Balance at end of year. Subtract line 8 from line 5 Page 4 Form1065 (2005)

Schedule K-1 (Form 1065) Department of the Treasury Internal Revenue Service 2005 year beginning, 2005 ending Partner s Share of Income, Deductions, Credits, etc. A B Part I Information About the Partnership Partnership s employer identification number For calendar year 2005, or tax Partnership s name, address, city, state, and ZIP code, 20 See back of form and separate instructions. 651105 Final K-1 Amended K-1 OMB No. 1545-0099 Part III Partner s Share of Current Year Income, Deductions, Credits, and Other Items 1 Ordinary business income (loss) 15 Credits & credit recapture 2 Net rental real estate income (loss) 3 Other net rental income (loss) 16 Foreign transactions 4 Guaranteed payments 5 Interest income 6a Ordinary dividends 6b Qualified dividends C IRS Center where partnership filed return 7 Royalties 8 Net short-term capital gain (loss) D E Check if this is a publicly traded partnership (PTP) Tax shelter registration number, if any 9a Net long-term capital gain (loss) 17 Alternative minimum tax (AMT) items F Check if Form 8271 is attached Part II Information About the Partner G Partner s identifying number 9b 9c Collectibles (28%) gain (loss) Unrecaptured section 1250 gain H Partner s name, address, city, state, and ZIP code 10 Net section 1231 gain (loss) 18 Tax-exempt income and nondeductible expenses 11 Other income (loss) I General partner or LLC member-manager Limited partner or other LLC member J Domestic partner Foreign partner 12 Section 179 deduction 19 Distributions K L What type of entity is this partner? Partner s share of profit, loss, and capital: 13 Other deductions 20 Other information Beginning Profit % Ending % Loss % % Capital % % 14 Self-employment earnings (loss) M Partner s share of liabilities at year end: Nonrecourse... $ Qualified nonrecourse financing... $ Recourse... $ *See attached statement for additional information. N Partner s capital account analysis: Beginning capital account... $ Capital contributed during the year.. $ Current year increase (decrease)... $ Withdrawals & distributions... $ ( ) Ending capital account... $ Tax basis GAAP Section 704(b) book Other (explain) 0 For IRS Use Only For Privacy Act and Paperwork Reduction Act Notice, see Instructions for Form 1065. Schedule K-1 (Form 1065) 2005 ISA STF FED3405F.1

Schedule K-1 (Form1065) 2005 Page 2 This list identifies the codes used on Schedule K-1 for all partners and provides summarized reporting information for partnerswho file Form 1040. For detailed reporting and filing information, see the separate Partner s Instructions for Schedule K-1 and the instructions for your income tax return. 1. Ordinary business income (loss). You must first determine whether the income (loss) is passive or nonpassive. Then enter on your return as follows: Enter on Passive loss See the Partner s Instructions Passive income Schedule E, line 28, column (g) Nonpassive loss Schedule E, line 28, column (h) Nonpassive income Schedule E, line 28, column (j) 2. Net rental real estate income (loss) See the Partner s Instructions 3. Other net rental income (loss) Net income Schedule E, line 28, column (g) Net loss See the Partner s Instructions 4. Guaranteed payments Schedule E, line 28, column (j) 5. Interest income Form 1040, line 8a 6a. Ordinary dividends Form 1040, line 9a 6b. Qualified dividends Form 1040, line 9b 7. Royalties Schedule E, line 4 8. Net short-term capital gain (loss) Schedule D, line 5, column (f) 9a. Net long-term capital gain (loss) Schedule D, line 12, column (f) 9b. Collectibles (28%) gain (loss) 28% Rate Gain Worksheet, line 4 (Schedule D Instructions) 9c. Unrecaptured section 1250 gain See the Partner s Instructions 10. Net section 1231 gain (loss) See the Partner s Instructions 11. Other income (loss) Code 12. 13. A Other portfolio income (loss) See the Partner s Instructions B Involuntary conversions See the Partner s Instructions C Sec. 1256 contracts & straddles Form 6781, line 1 D Mining exploration costs recapture E Cancellation of debt See Pub. 535 Form 1040, line 21 or Form 982 F Other income (loss) See the Partner s Instructions Section 179 deduction See the Partner s Instructions Other deductions } A Cash contributions (50%) B Cash contributions (30%) C Noncash contributions (50%) D Noncash contributions (30%) See the Partner s E Capital gain property to a 50% Instructions organization (30%) F Capital gain property (20%) G Cash contributions (100%) H Investment interest expense Form 4952, line 1 I Deductions royalty income Schedule E, line 18 J Section 59(e)(2) expenditures See Partner s Instructions K Deductions portfolio (2% floor) Schedule A, line 22 L Deductions portfolio (other) Schedule A, line 27 M Amounts paid for medical insurance Schedule A, line 1 or Form 1040, line 29 N Educational assistance benefits See the Partner s Instructions O Dependent care benefits Form 2441, line 12 P Preproductive period expenses See the Partner s Instructions Q Commercial revitalization deduction from rental real estate activities See Form 8582 Instructions R Pensions and IRAs See the Partner s Instructions S Reforestation expense deduction See the Partner s Instructions T Domestic production activities information See Form 8903 instructions U Qualified production activities income Form 8903, line 7 V Employer s W-2 wages Form 8903, line 13 W Other deductions See the Partner s Instructions 14. Self-employment earnings (loss) Note. If you have a section 179 deduction or any partner-level deductions, see the Partner s Instructions before completing Schedule SE. A Net earnings (loss) from self-employment Schedule SE, Section A or B B Gross farming or fishing income See the Partner s Instructions C Gross non-farm income See the Partner s Instructions 15. Credits & credit recapture A Low-income housing credit (section 42(j)(5)) Form 8586, line 4 B Low-income housing credit (other) Form 8586, line 4 C Qualified rehabilitation expenditures (rental real estate) Form 3468, line 1 D Qualified rehabilitation expenditures (other than rental real estate) E Basis of energy property Form 3468, line 1 See the Partner s Instructions F Other rental real estate credits See the Partner s Instructions G Other rental credits H Undistributed capital gains credit See the Partner s Instructions Form 1040, line 70; check box a I Credit for alcohol used as fuel See the Partner s Instructions 16. 17. Code Enter on J Work opportunity credit Form 5884, line 3 K Welfare-to-work credit Form 8861, line 3 L Disabled access credit Form 8826, line 7 M Empowerment zone and renewal community employment credit Form 8844, line 3 N Credit for increasing research activities Form 6765, line 42 O New markets credit P Credit for employer social security and Medicare taxes Q Backup withholding R Recapture of low-income housing credit (section 42(j)(5)) S Recapture of low-income housing credit (other) T Recapture of investment credit U Other credits V Recapture of other credits Foreign transactions A Name of country or U.S. possession B Gross income from all sources C Gross income sourced at partner level Form 8611, line 8 See Form 4255 See the Partner s Instructions See the Partner s Instructions Form 1116, Part I Form 1116, Part I Form 1116, Part I Foreign gross income sourced at partnership level D Passive Form 1116, Part l E Listed categories Form 1116, Part I F General limitation Form 1116, Part I Deductions allocated and apportioned at partner level G Interest expense Form 1116, Part I H Other Form 1116, Part I Deductions allocated and apportioned at partnership level to foreign source income I Passive Form 1116, Part I J Listed categories Form 1116, Part I K General limitation Form 1116, Part I Other information L Total foreign taxes paid Form 1116, Part II M Total foreign taxes accrued Form 1116, Part II N Reduction in taxes available for credit Form 1116, line 12 O Foreign trading gross receipts Form 8873 P Extraterritorial income exclusion Form 8873 Q Other foreign transactions See the Partner s Instructions Alternative minimum tax (AMT) items A Post-1986 depreciation adjustment } B Adjusted gain or loss See the Partner s C Depletion (other than oil & gas) Instructions and D Oil, gas, & geothermal gross income the Instructions for E Oil, gas, & geothermal deductions Form 6251 F Other AMT items 18. Tax-exempt income and nondeductible expenses A Tax-exempt interest income Form 1040, line 8b B Other tax-exempt income C Nondeductible expenses 19. Distributions A Cash and marketable securities B Other property 20. Other information A Investment income Form 4952, line 4a B Investment expenses Form 4952, line 5 C Fuel tax credit information Form 4136 D Look-back interest completed long-term contracts Form 8697 E Look-back interest income forecast method Form 8866 F Dispositions of property with section 179 deductions G Recapture of section 179 deduction H Special basis adjustments I Section 453(l)(3)information J Section 453A(c) information K Section 1260(b) information L Interest allocable to production expenditures M CCF nonqualified withdrawals N Information needed to figure depletion oil and gas O Amortization of reforestation costs P Unrelated business taxable income Q Other information Form 8874, line 2 Form 8846, line 5 Form 1040, line 64 Form 8611, line 8 See the Partner s Instructions See the Partner s Instructions See the Partner s Instructions See the Partner s Instructions See the Partner s }Instructions STF FED3405F.2

Department of the Treasury Internal Revenue Service Contents Introduction... 1 Publication 583 (Rev. December 2003) What New Business Owners Need To Know... 2 Forms of Business... 2 Identification Numbers... 3 Employer Identification Number (EIN)... 3 Payee s Identification Number... 4 Starting a Tax Year... 4 Business and Accounting Method... 5 Business Taxes... 5 Keeping Income Tax... 5 Self-Employment Tax... 5 Employment Taxes... 7 Records Excise Taxes... 8 Depositing Taxes... 8 Information Returns... 8 Penalties... 9 Business Expenses... 9 Business Start-Up Costs... 10 Depreciation... 10 Business Use of Your Home... 10 Car and Truck Expenses... 11 Recordkeeping... 11 Why Keep Records?.... 11 Kinds of Records To Keep... 12 How Long To Keep Records... 15 Sample Record System... 16 How To Get More Information... 24 Index... 27 Introduction This publication provides basic federal tax information for people who are starting a business. It also provides information on keeping records and illustrates a recordkeeping system. Throughout this publication we refer to other IRS publications and forms where you will find more information. In addition, you may want to contact other government agencies, such as the Small Business Administration (SBA). See page 24 to find out how to get more information. Get forms and other information faster and easier by: Internet www.irs.gov or FTP ftp.irs.gov Comments and suggestions. We welcome your comments about this publication and your suggestions FAX 703 368 9694 (from your fax machine) for www.irs.gov/efile future editions. You can email us at *taxform@irs.gov. Please put Publications Comment on the subject line. STF PUB583F.1