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09-29-14
J 1505610143 REV-1500 EX(02-11) + OFFICIAL USE ONLY PA Department of Revenue Pennsylvania count'cone year File Number Bureau of Individual Taxes Bea+ PO BOX.280601 INHERITANCE TAX RETURN 21 10 00692 Harrisburg,PA 17128-0601 RESIDENT DECEDENT ENTER DECEDENT INFORMATION BELOW Social Security Number Date of Death Date of Birth 06 14 2010 07 26 1954 Decedent's Last Name Suffix Decedent's First Name MI POWELL RICHARD W (If Applicable)Enter Surviving Spouse's Information Beim Spouse's Last Name Suffix Spouse's First Name MI Spouse's Social Security Number THIS RETURN MUST BE FILED IN DUPLICATE WITH THE REGISTER OF WILLS FILL IN APPROPRIATE OVALS BELOW 1. Original Return 2. Supplemental Return ❑ 3. Remainder Return(Date of Death Pdorto 12-1342) ❑ 4. Limited Estate ❑ 41.Future Ineree cornpMise ❑ 5. Federal Estate Taz Return Require0 (dateddeathaeer12-12-82) Dee tDied 7681810 F eqt Main wgn Livi Tnnt ® 6. (Attach copy d Will) ❑ 7' (Anatll t,6PY of Tru S. Total Number of Safe Deposit Boxes ❑ 9. Litigation Proceeds Received ❑ t0. 3-",W4 qvDOatn ❑ 11.Election to tax under Sec.9113(A) (Attach Schedule O) CORRESPONDENT-THIS SECTION MUST BE COMPLETED,ALL CORRESPONDENCE AND CONFIDENTIAL TAX INFORMATION SHOULD BE DIRECTED TO: Name Daytime Telephone Number HEATHER D ROYER ESQ (717) 234 2401 REGISTER OF WILLS USE ONLY ry First Line of Address ° 4431 N FRONT ST 3RD FL g z n o Second Line of Address W s G7 —moo i 0 _ n N I ,-I rn CD State ZIP Code City or Poet Office DAE PILED HARRISBURG PA 17110 u `� ::3 - ?I r c� :J CC) M r Correspondent's e-mail address: hrover(Msasllp.com ti N Cn Under penaales of perjury,I declare that 1 have examined this mum,inducting aoxmpanying schedules and tdatemems,and to the best or my knowledge end befler, x is true,coned and complete.Declaration of prepaw other than the personal representative is based on all infonnason of which paperer has any knowledge. SIGNATURE OFgSON R PONSIaLE FOR G RETU N DATE Michael W. Powell 5! grf i2a • ao�5/ ADDRESS 1166 Younci Rd. Punxsutawney, PA 15767 SIG TUR OF PRE ARE ER THAN REPRESENTATIVE DA Heather D.Royer Esq. ADDRESS 4431 N. Front St.,3rd R.,Harrisburg, PA 17110 Side 1 1505610143 1505610143 1505610243 REV-1500 EX Decedent's Social Security Number Decedents Name. Powell, Richard Wayne RECAPITULATION 1. Real Estate(Schedule A)....................................................................................... 1. 159, 000 . 00 2. Stocks and Bonds(Schedule B)............................................................................. 2. 34 . 62 3. Closely Held Corporation, Partnership or Sole-Proprietorship(Schedule C)......... 3. 0 . 00 4. Mortgages&Notes Receivable(Schedule D)........................................................ 4. 5. Cash, Bank Deposits&Miscellaneous Personal Property(Schedule E)............... 5. 27 , 870 . 40 6. Jointly Owned Property(Schedule F) ❑ Separate Billing Requested............ 6. 7. Inter-Vivos Transfers&Miscellaneous N Probate Property (Schedule G) U Separate Billing Requested............ 7, 8. Total Gross Assets (total Lines 1 through 7)........................................................ 8, 186 , 905 . 02 9. Funeral Expenses and Administrative Costs(Schedule H).................................... 9. 82 , 023 . 92 10. Debts of Decedent,Mortgage Liabilities and Liens(Schedule 1)............................ 10. 436, 031 . 65 11. Total Deductions(total Lines 9 and 10)................................................................ 11. 518 , 055 . 57 12. Net Value of Estate(Line 8 minus Line 11).......................................................... 12. -331 , 150 . 55 13. Charitable and Governmental Bequests/Sec 9113 Trusts forwhich an election to tax has not been made(Schedule J)............................................... 13. 14. Net Value Subject to Tax(Line 12 minus Line 13)............................................... 14. -331 , 150 . 55 TAX COMPUTATION-SEE INSTRUCTIONS FOR APPLICABLE RATES 15. Amount of Line 14 taxable at the spousal tax rate, or transfers under Sec. 9116 15 0 . 00 (a)(1.2)X.00 16. Amount of Line 14 taxable 0 . 00 16. 0 . 00 at lineal rate X .045 17. Amount of Line 14 taxable at sibling rate X.12 0 . 00 17. 0 . 00 .1 18. Amount of Line 14 taxable 0 . 00 18. 0 . 00 4 at collateral rate X.15 19. TAX DUE................................................................................................................ 19. 0 . 00 20. FILL IN THE OVAL IF YOU ARE REQUESTING A REFUND OF AN OVERPAYMENT. Side 2 1505610243 1505610243 J REV-1500 EX Page 3 File Number 21-10-00692 Decedent's Complete Address: DECEDENT'S NAME Powell, Richard Wayne STREETADDRESS 686 Front Street CITY STATE ZIP Enola PA 17025 Tax Payments and Credits: 1. Tax Due(Page 2, Line 19) (1) 0.00 2. Credits/Payments A. Prior Payments B. Discount Total Credits(A +B) (2) 3. Interest (3) 4, If Line 2 is greater than Line 1 +Line 3,enter the difference. This is the OVERPAYMENT. (4) Check box on Page 2,Line 20 to request a refund 5, If Line 1 +Line 3 is greater than Line 2,enter the difference. This is the TAX DUE. (5) 0,00 Make Check Payable to: REGISTER OF WILLS, AGENT. PLEASE ANSWER THE FOLLOWING QUESTIONS BY PLACING AN "X" IN THE APPROPRIATE BLOCKS 1. Did decedent make a transfer and: Yes No a. retain the use or income of the property transferred;............................................ .................................. ❑ ❑ b. retain the right to designate who shall use the property transferred or its income:........ ..................- ❑ lxl c. retain a reversionary interest;or............................................................................................................... ❑ ❑x d. receive the promise for life of either payments,benefits or care?............................................................ ❑ 2. If death occurred after Dec. 12, 1982, did decedent transfer property within one year of death without receiving adequate consideration?.................................................................................................................... ❑ 0 3. Did decedent own an"in trust for" or payable upon death bank account or security at his or her death?....... ❑ 0 4. Did decedent own an individual retirement account,annuity,or other non-probate property which contains a beneficiary designation?.................................................................................................................. ❑ 0 IF THE ANSWER TO ANY OF THE ABOVE QUESTIONS IS YES,YOU MUST COMPLETE SCHEDULE G AND FILE IT AS PART OF THE RETURN. For dates of death on or after July 1, 1994 and before Jan. 1, 1995,the tax rate imposed on the net value of transfers to or for the use of the surviving spouse is 3 percent[72 P.S.§9116(a)(1.1)(i)]. For dates of death on or after January 1,1995,the tax rate imposed on the net value of transfers to or for the use of the surviving spouse is 0 percent 172 P,S.§9116(a)(1.1)(ii)]. The statute does not exempt a transfer to a surviving spouse from tax,and the statutory requirements for disclosure of assets and filing a tax return are still applicable even if the surviving spouse is the only beneficiary, For dates of death on or after July 1,2000: • The tax rate imposed on the net value of transfers from a deceased child 21 years of age or younger at death to orfor the use of a natural parent,an adoptive parent,ore stepparent of the child is 0 percent[72 P.S.§9116(a)(1.2)]. • The tax rate imposed on the net value of transfers to or for the use of the decedent's lineal beneficiaries is 4.5 percent,except as noted in[72 P.S.§9116(a)(1)]. • The tax rate imposed on the net value of transfers to orfor the use of the decedent's siblings is 12 percent[72 P.S.§9116(a)(1.3)]. A sibling is defined, under Section 9102,as an individual who has at least one parent in common with the decedent,whether by blood or adoption. Rev-1502 EX.(0110) SCHEDULE A pennsylvania REAL ESTATE DEPARTMENT OF REVENUE INHERITANCE TAX RETURN RESIDENT DECEDENT ESTATE OF FILE NUMBER Powell, Richard Wayne 21-10-00692 All real property owned solely or as a tenant in common must be reported at fair market value.Fair market value is defined as the price at which property would be exchanged between a willing buyer and a willing seller,neither being compelled to buy or sell both having reasonable knowledge of the relevant facts. Real property that is jointly-owned with right of survivorship must be disclosed on schedule F. Attach a copy of the settlement sheet if the property has been sold Include a copy of the deed showing decedent's Interest if owned as tenant in common. ITEM VALUE AT DATE NUMBER DESCRIPTION OF DEATH 1 686 Front Street, Enola, PA 17025-Value per appraisal 159,000.00 TOTAL(Also enter on Line 1, Recapitulation) 159,000.00 (If more space is needed,additional pages of the same size) Copyright(c)2010 form software only The Lackner Group, Inc. Form PA-1500 Schedule A(Rev.01-10) Rev-1503 EX+(6.68) SCHEDULE B STOCKS & BONDS COMMONWEALTH OF PENNSYLVANIA INHERITANCE TAX RETURN RESIDENT DECEDENT ESTATE OF FILE NUMBER Powell, Richard Wayne 21-10-00692 All property jointly-owned with right of survivorship must be disclosed on Schedule F. ITEM CUSIP VALUE AT DATE NUMBER NUMBER DESCRIPTION UNIT VALUE OF DEATH 1 Series EE $50 Savings Bond 25.00 Accrued interest on Item 1 through date of death 9.62 TOTAL(Also enter on Line 2, Recapitulation) 34.62 (If more space is needed,additional pages of the same size) Copyright(c)2002 form software only The Lackner Group, Inc. Form PA-1500 Schedule B(Rev. 6-98) Rey.1504 E%a(6-98) SCHEDULE C CLOSELY-HELD CORPORATION, PARTNERSHIP OR COMMONWEALTH OF PENNSYLVANIA SOLE—PROPRIETORSHIP INHERITANCE TAX RETURN RESIDENT DECEDENT ESTATE OF FILE NUMBER Powell, Richard Wayne 21-10-00692 Schedule C-1 or C-2(Inclutling all supporting information)must be attached for each closely-held corporationlpartnership interest of the decedent,other than a so proprietorship See instructions for the supporting information to be submitted for sole-proprietorships. ITEM VALUE AT DATE NUMBER DESCRIPTION OF DEATH 1 ALP Solutions, LLC -This company had no assets and has no value 0.00 2 PC and Network Associates, Inc. -Closely Held Corporation 0.00 TOTAL(Also enter on Line 3, Recapitulation) 0.00 (If more space is needed,additional pages of the same size) ' Copyright(c)2002 form software only The Lackner Group, Inc. Form PA-1500 Schedule C(Rev.6-98) REV-1505 Ex+(11-I1) pennsylvania SCHEDULE C-1 �7 DEPARTMENT OF REVENUE CLOSELY-HELD CORPORATE INHERITANCE TAX RETURN STOCK INFORMATION REPORT RESIDENT DECEDENT ESTATE OF FILE NUMBER Powell,Richard W. 2110-00692 1. Name of Corporation PC&Network Associates,Inc. State of Incorporation Pennsylvania Address 686 Front Street Date of Incorporation 10/12/19 City Enola State PA ZIP Code 17025 Total Number of Shareholders 1 2. Federal Employer ID Number 25-1847000 Business Reporting Year 2010 3. Type of Business Computer Sales&Network Maintenance Product/Service Computer Sales/Network Maintenance 4' TYPE TOTAL NUMBER OF NUMBER OF SHARES VALUE OF THE STOCK Voting/Non-Voting SHARES OUTSTANDING PAR VALUE OWNED BY THE DECEDENT DECEDENT's STOCK Common Voting 5500 1.00 5500 $ 0 Preferred $ Provide all rights and restrictions pretalning to each class of stock. 5. Was the decedent employed by the corporation? . .. .. . . .. .. . .. .. . .. .. . .. ... . .. ... . )8(Yes 0 No If yes, Position President,VP,Secretary,Teasurer Annual Salary $ 13480 Time Devoted to Business 100% 6. Was the corporation indebted to the decedent? . .. .. . . .. .. . .. .. . .. . .. .. . .. ... . ... . 0 Yes X No If yes, provide amount of indebtedness$ 7. Was there life insurance payable to the corporation upon the death of the decedent? .. .. . 0 Yes 19 No If yes,Cash Surrender Value$ Net proceeds payable$ Owner of the policy 8. Did the decedent sell or transfer stock in this company within one year prior to death or within two years if the date of death was prior to 12-31-82? 0 Yes )sl No If yes, 0 Transfer 0 Sale Number of Shares Transferee or Purchaser Consideration$ Date Attach a separate sheet for additional transfers and/or sales. 9. Was there a written shareholder's agreement in effect at the time of the decedent's death? ....0 Yes 0 No If yes,provide a copy of the agreement. 10.Was the decedent's stock sold? ..................................................... 0 Yes X No If yes,provide a copy of the agreement of sale,etc. 11. Was the corporation dissolved or liquidated after the decedent's death? .................... X Yes 0 No If yes,provide a breakdown of distributions received by the estate,including dates and amounts received. 12.Did the corporation have an interest in other corporations or partnerships? .. . .. . .. . ... . 0 Yes X No If yes, report the necessary information on a separate sheet, including a Schedule C-1 or C-2 for each interest. THE FOLLOWING INFORMATION A. Detailed calculations used in the valuation of the decedent's stock. B. Complete copies of financial statements or federal corporate income tax returns(Form 1120)for the year of death and four preceding years. C. If the corporation owned real estate,submit a list showing the complete addresses and estimated fair market value/s.If real estate appraisals have been secured,attach copies. D. List of principal stockholders at the date of death,number of shares held and their relationships to the decedent. E. List of officers,their salaries,bonuses and any other benefits received from the corporation. F. Statement of dividends paid each year.List those declared and unpaid. G. Any other Information relating to the valuation of the decedent's stock. (It more space is needed,insert additional sheets of the same size.) PC & NETWORK ASSOCIATES, INC. ASSETS: Proceeds from sale of office/computer equipment $1,804.00 PSECU Bank Account 257.63 TOTAL $2,061.63 DEBTS: Bank of America Credit Card $ 4,459.36 Chase Credit Card $10,136.31 Capital One Credit Card $17,420.99 American Express Credit Card $ 5,507.81 American Express Credit Card $22,548.95 Advanta Credit Card $17,192.08 Capital One Credit Card $ 9,350.14 Capital One Loan $31,136.49 Verizon $ 595.68 Smigel, Anderson & Sacks $ 250.00 PNC —Release fee for UCC filing $ 1,804.00 TOTAL $120,401.81 ASSETS $ 2,061.63 LESS DEBTS $120.401.81 VALUE ($118,340.18) P07000 09/09/2010 7:58 PM Form 1120S U.S. Income Tax Return for an S Corporation OMB No.1545-0130 ► Do not file this form unless the corporation has fled or is ^007 Depadment of the Treasury attaching Form 2553 to elect to be an S corporation. L Internal Revenue Service 77 See separate Instructions, For calendar year 2007 or tax year beqinning ending A S election effective date Name D Employer identification number 10/12/99 IRS PC & Network Associates Inc 25-1847000 B Business activity,code label. Number,street,and room or suite no.If a P.O.box,see instructions. E Dale incorporated number(see instructions) Other- wise, 541519 print or 1166 Young Road 10/12/1999 type. C Check if Sch.M-3 11 City or town,state,and ZIP code attached Punxsutawney PA 15767 F Total assets(see instructions) $ 32,571 G Is the corporation electing to be an S corporation beginning with this tax year? ❑ Yes ❑X No If"Yes,"attach Form 2553 if not already filed H Check if: (1) Final return (2) 11 Name change (33) El Address change (4) X Amended return Stmt 1 (5) Selection termination or revocation I Enter the number of shareholders in the corporation at the end of the tax year 1, 1 .......................................... Caution. Include only trade or business income and expenses on lines la through 21. See the instructions for more information. 1a Gross receipts or sales 1 236,7271 to Less returns and allowances I 6,125 c Bal I, 1c 230 602 y 2 Cost of goods sold(Schedule A,line 8) .............„.,,,._..._.,,..,,,....__. 2 47 983 C 3 Gross profit.Subtract line 2 from line 1c 3 182 619 ...................................................................... 0 4 Net gain(loss)from Form 4797, Part II, line 17 (attach Form 4797) ,.,, 4 ......................................... 5 Other income (loss) (see instructions—attach statement) .............................. .. 5 6 Total Income(loss). Add lines 3 through 5.................... ......... ......... ......... ....... ► 6 182 619 7 Compensation of officers ......................._........................................................... 7 37 787 8 Salaries and wages(less employment credits) ................................................................. 8 77 734 9 Repairs and maintenance ................................................................................... 9 .E 10 Bad debts ..............................................................................I.................. 10 .p` 11 Rents ..................................................................................................... 11 8 820 12 Taxes and licenses ......................................................................................... 12 9,123 13 Interest .................................................................................................... 13 43 660 14 Depreciation not claimed on Schedule A or elsewhere on return (attach Form 4562) 14 9,993 v N 15 Depletion (Do not deduct oil and gas depletion.) 15 fin 16 Advertising ................................................................................................ 16 9 956 0 17 Pension, profit-sharing, etc., plans ............................................................................ 17 18 Employee benefit programs .................................................................................. 18 19 Other deductions (attach statement) See Stmt 2 19 44 ,526 ....................... 0 20 Total deductions. Add lines 7 through 19....................... ...... Ill 20 241,599 ... ............................ 21 Ordinary business income (loss). Subtract line 20 from line 6 .................................................. 21 -58,980 22a Excess net passive income or LIFO recapture tax(see instructions) 22a ........................ b Tax from Schedule D(Farm 11205) 22b ............................................ c c Add lines 22a and 22b see instructions for addillonal taxes E 23a 2007 estimated tax payments and 2006 overpayment credited to 2007 230 b Tax deposited with Form 7004 23b ................................................ It. c Credit for federal tax paid on fuels(attach Form 4136) 23c ........................... C d Add lines 23a through 23c 2gd K 24 Estimated tax penally(see instructions). Check if Form 2220 is attached ► ❑ 24 H 25 Amount owed. 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 from line 26 Credited to 2008 estimated tax ► Refunded ► 27 Under penalties of perjury,1 declare that I have examined this return,including accompanying schedules and statements, May the IRS discuss this return with the preparer and to the best of my knowledge and belief,it is true,correct,and complete.Declaration of preparer(other than taxpayer) Sign is based on all information of which preparer has any knowledge, shown below see instructors? X Yes No Here ' ' President Signature of officer Richard Powell Dale roe Preparers Date Check if Preparers SSN or PTIN Paid aignatue 9/09/10 self-employed ❑X P00230493 Preparer's Firm's name(or Ericson Accounting Services EIN 13-4215201 Use Only yours if self-employed), 205 Hemlock Rd Phone no. address,and ZIP code New Cumberland, PA 17070-2826 717-514-0149 For Privacy Act and Paperwork Reduction Act Notice,see separate instructions. Form 1120S (2007) DAA P07000 0910972010 7:58 PM Form 11205(2007) PC & Network Associates Inc 25-1847000 Page 2 Schedule A Cost of Goods Sold see instructions 1 Inventory at beginning of year 1 16() .................................................................................. 2 Purchases 2 48,029 ................................................................................................... 3 Cost of labor ................................................................................................. 3 4 Additional section 263A costs(attach statement) .................................. q 5 Other costs(attach statement) ... ............................. ... ......... ..... Stmt 3 5 —26 .......... 6 Total. Add lines lthrough 5 ................................................................................... 6 48,183 ............. .... 7 Inventory at end of year 7 200 . ..................................................................... 8 Cost of goods sold. Subtract line 7 from line 6.Enter here and on page 1,line 2 8 47 983 .................................... 9a Check all methods used for valuing dosing inventory: (i) X Cost as described In Regulations section 1.471-3 (ii) Lower of cost or market as described in Regulations section 1.471.4 (iii) 0 Other(Specify method used and attach explanation.) ► ........................................................................ 471 .....� b Check if there was a writedown of subnormal goods as described in Regulations section 1. -2(c) .......... . ..... ► ......................... . . c Check If the LIFO Inventory method was adopted this tax year for any goods(it 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? Yes X No Y 9 g q opening g .... Yes X No f Was there an change In determining uantities,cost,or valuations between o enin and dosing inventory? ...................... It'Yes,"attach explanation. ;Schedule B Other Information see instructions Yes No 1 Check accounting method: a X Cash b Accrual c Lj Other(specify) ► ..................................... 2 See the instructions and enter the: a Business activity ► computer $ IT sere b Product or service ►.,computer & IT sery .................. 3 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 and employer Identification number (EIN), (b) percentage owned,and(c) if 100%owned,was a QSub election made? X ................................. 4 Has this corporation fled,or Is it required to file,a return under section 6111 to provide information on any reportable transaction? .................................................................................................................... X 5 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 Publicty Offered Original Issue Discount Instruments. 6 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 ............................................................... ► $ 7 Enter the accumulated earnings and profits of the corporation at the end of the tax year. $ 8 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?It"Yes"the corporation is not required to complete Schedules L and M-1. ......................................... X Schedule K Shareholders' Pro Rata Share Items Total amount 1 Ordinary business income(loss)(page 1, line 21) t 58 980 (loss) ...:.................................................... 2 — 2 Net rental real estate income loss attach Form 8825 .................................................. .. ..... .. .. . 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 y ................................................ J 4 Interest income 4 ....................................................................................... �- 5 Dividends: a Ordinary dividends Sa ........................................................................ c b Qualified dividends ......................................... 6 Royalties ................................................ 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(26%)gain (loss) gb ............................................ c Unrecaptured section 1250 gain (attach statement) gc ......................... 9 Net section 1231 gain(loss)(attach Form 4797) 9 ......................................... 10 Other income loss see Instructions .4....... Type ► 10 Forth 11205(2007) DM P07000 0910902010 7:58 PM Fom,112GS 2001 PC & Network Associates Inc 25-1847004 Pace 3 Shareholders'Pro Rata Share Items continued Total amount H 11 Section 179 deduction(attach Form 4562) ......................... 11 .................................... 12a Contributions T .. .............................. . .......... 12a b Investment Interest.expense........ ........._............... . ....... ........ ........... ........ ....................... ........ 12b g c Section 59(e)(2)expenditures (1)Type ► .............................................. (2)Amount ► 12c(2) d Other deductions see instructions _...... . Type ► 12d 13a low-Income housing credit(section 42{))(5)} ........................................................... 138 b low-income housing credit(other) .................................................................... 13b c Qualified rehabilitation expenditures (rental real estate)(attach Form 3468)................................ 13c d Other rental real estate credits(see instructions) .,__.Type ► ... .,. 13d ................................ u a Other rental credits(see instructions) ...............Type ► ,........................................ 130 f Credit for alcohol used as fuel(attach Form 6478) ................................. Other molls see Instructions .... ...... . Type ► 13 14a Name of country or U.S.Possession ► ............................................................... b Gross income from all sources 14b ....................................................................... c Gross income sourced at shareholder level ............................................................ 14c Foreign gross income sourced at corporate level d Passive category ........................................................._.,...................... 14d eGeneral category ................................................................................... 149 N f Other(attach statement) ............................... ................................ 14f Deductions allocated and apportioned at shareholder level @ g Interest expense...................... ................. 14 ............................................. ~ h Other 14h .i Deductions allocated and apportioned at corporate level to foreign source income u°. 1 Passive category ............................. 141 ) General category ................................................................................... 14 k Other(attach statement) 14k .................................................................I........... Other information _ t Total foreign taxes(check one): ► ❑ Paid ❑ Accrued 141 m Reduction in taxes available for credit(attach statement) .... ... 14m . ........................................ n Other forei n tax information attach statement ........... .. ........ ...._.... ....... ........ 153 Post-1966 depredation adjustment ...... . 158 167 i1le Adjusted gain or loss................................................................................ 15b I E r c Depletion(other than oil and gas).............. 15c E E� d OII,gas,and geothermal properties-gross income....................................................... 15d g" a Oil.gas,and geothermal properties-dedud'wns ........................................................ 15e f Other AMT items attach statement ......... ....................... ...................... ....... 15f c 16a Tax-exempt interest Income.......................................................................... 16a o,x b O#her tax-exempt income 16b .......................................................................... a Nondeductible expenses ,,.......,, .......... 16c 23 �m ..................................................... Nd Property distributions ................................................................................ 16d = e Repayment of bans from shareholders ,... .. ..... ... ...... .. 160 c 17a Investment income 17a t8 b investment expenses ,,,,. 17b 8888 P ................................. ......................................... e Dividend distributions paid from accumulated earnings and profits .. ... ... 17c d Other items and amounts attach statement Ao 18 Incomefloss reconciliation. Combine the amounts on lines 1 through 10 in the far light column.From the result, subtract the sum of the amounts on lines 11 through 12d and 141 .................. 1g Form 11205{2997) mAA P07000 09/092010 7:58 PM Fom, 11206 2007 PC 6 Network Associates Inc 25-1847000 Page 4 Schedule L Balance Sheets per Books Beginning at tax year End of tax year Assets a b c d 1 cash ................................... 17,476 1 ,405 2a Trade notes and accounts receivable It Less allowance for bad debts .............. 3 Inventories 190 200 .............................. 4 U.S.government obligations 5 Tax-exempt securities (see Instructions) .... 6 Other anent assets(attach statemenQ ............... 7 Loans to shareholders .Mortgage and real estate loans ............ 9 OU&FvesPrents(attach statenert) 10a Buildings and other depreciable assets 129,929 93 248 Is Less accumulated depreciation . .......... 53,744 76,185 ( 62,282 30,966 . 11a Depletable assets ........................ b Less accumulated depletion ............... 12 Land(net of any amortization) ............. - E__— 13a Intangible assets (amortizable only) b Less accumulated amortization 14 Other assets(attach statement) .....,,..... 15 Total assets ............................. 93,841 32 571 Liabilities and Shareholders' Equity 16 Accounts payable ........................ 17 Mortgages,miss,bonds payable in less than 1 year 182 463 226,535 18 oilwama,trabnestanamstatement) Stmt 4 1,088 1,584 19 Loans from shareholders 49 297 59 996 .................. 20 Mortgages,notes,bonds payable in 1 year or more 167 968 148 630 21 Other liabilities(attach statement) 22 Capital stock 7,500 7 500 ............................. 23 Additional paidin capital 52,202 9,006 .................. 24 Retained earnings ........................ —361 677 —420 680 25 Adjustments to sharehoders' equity(attach statement) ..................... 26 Less cost of treasury stock 27 Total liabilities and shareholders' equity' ui 93 841 32 571 _Schedule M-1_ Reconciliation of Income (Loss) per Books With Income (Loss) per Return Note: Schedule M-3 re uired instead of Schedule M-1 if total assets are$10 million or more—see instructions 1 Net Income(loss)per books 5 Income recorded on books this year not included 2 Income included on Schedule K,Imes 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 6 Deductions included on Schedule K, lines included on Schedule K,lines 1 through 12 1 through 12 and 141, not charged against and 141(itemize): book income this year(itemize): a Depredation $ a Depreciation $ b Travel and ........................... entertainment $ ,,,,, . ..............................*4'......... 7 Add lines 5 and 6 ........................................ .......................... 4 Add lines 1 throw h 3 ................... 8 Income foss Schedule line 18.Line less line 7 Analysis of Accumulated Adjustments Account, Other Adjustments Account, and Shareholders' Schedule M-2; Undistributed Taxable Income Previous) Taxed see instructions (a)Accumulated (b)Other adjustments (c)Shareholders'undistributed adjustments account account taxable Income previously taxed 1 Balance at beginning of tax year —361 677 2 Ordinary income from page 1, line 21 3 Other additions .......................... 4 Loss from page 1,line 21 58, 980 5 Other reductions Stmt 5 23 6 Combine lines 1 through 5 -420,680 7 Distributions other than dividend distributions 8 Balance at end of tax year.Subtract line 7 from line 6 —420,6801 OAA Form 1120S(2007) P07000 091092010 7:58 PM 671107 ElFinal K-1 a Amended K-1 OMB No.1545-0130 Schedule K-1 2007 part III Shareholder's Share of Current Year Income, (Form 1120S) For calendar year 2007,or tax Deductions Credits and Other Items Department of the Treasury year beginning 1/01/07 1 Ordinary business Income pass) 13 Credits Internal Revenue Service ending 12/31/07 -58, 980 Shareholders Share of Income, Deductions, 2 Net rental real estate income(loss) Credits, etc. 1 See back of form and separate instructions. 3 Other net rental income(loss) Part I Information About the Corporation 4 Interest Income A Corporation's employer Weriffication number 25-1847000 53 Ordinary dividends B Corporation's name,address,city,state.and ZIP coda PC & Network Associates, Inc Sb Qualified dividends 14 Foreign transactions 1166 Young Road 6 Royalties Punxsutawney PA 15767 C IRS Center where corporation riled return 7 Net shod-torn capital gain(loss) Cincinnati OH 45999 Part II Information About the Shareholder 8a Net long-term capital gain(loss) D Shareholoers Identifying number 8b Cullec6bles(28%)gain(loss) E Shareholders name,address,city,state,and ZJP code 8c Unrecaptured section 1250 gain Richard Powell c/o Michael Powell, Executor 9 Net section 1231 gain foss) 1166 Young Rd Punxsutawiiey PA 15767 10 Other Income(loss) 1s Motivative minimum tax(AMT)Items F Shareholders percentage of stock A 167 100.000000 % ownership for tax year I NOR 111 I 11 Section 179 deducibn 1`B* Items affecting shareholddeerr basis � �LY PR,� I�I 12 Other deductions t c O d N N K UL 17 Other Information See attached statement for additional information. For Paperwork Reduction Act Notice,see Instructions for Form 1120S. Schedule K-1 (Form 11205)2007 DAA P07000 091092010 7:58 PM Fom, 4562 Depreciation and Amortization OMB No.1545-0172 (Including Information on Listed Property) 2007 Department of the Treasury Internal Revenue Service Attachment Ill' separate instructions. D Attach to our tax return. S uence No. 67 Name(s)shown on return Identifying number PC 6 Network Associates Inc 25-1847000 Business or activity to which this forth relates Regular Depreciation LPart I_J 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 the instructions for a higher limit for certain businesses 1 125 000 ...................................... 2 Total cost of section 179 property placed in service(see instructions) 2 .............................................. 3 Threshold cost of section 179 property before reduction in limitation 3 500,000 ................................................ 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 separate see instructions ............ 5 (a) Description of property (b) Cost(business use only) (c) Elected cost 6 {+I 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 g .......................................................... 10 Carryover of disallowed deduction from line 13 of your 2006 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 2008.Add lines 9 and 10 less line 12 ► 13 1 Note: Do not use Part II or Part III below for listed property.Instead,use Part V. I Part II 1 Special Depreciation Allowance and Other Depreciation Do not include listed proDe See instructions. 14 Special allowance for qualified New York Liberty or Gulf Opportunity Zone property(other than listed property)and cellulosic biomass ethanol plant property placed in service during the tax year(see instructions) 14 15 Property subject to section 1680(1)election 15 .................................................................. 16 Other depreciation (Including ACRS ........................................................................... 15 9,326 1. Part III 1 MACRS Depreciation (Do not include listed property ) (See instructions.) Section A 17 MACRS deductions for assets placed in service in tax years beginning before 2007 � I................................I',',I 17 235 18 If you are electing to Group any assets placed in service during me tax year Into one or more general asset accounts.check here I 1 Section E-Assets Placed in Service During 2007 Tax Year Using the General Depreciation System a classification of (b) Month and (c) Basis for depredation (d) Recovery O property year placed In (businessfinvestment use (a) Convention (Q Method (g) Depredation deduction sorvice only,an instructions) period 193 3-year property b 5-year property 2,090 5.0 M-Q 20ODB 432 c 7-year property d 10-year property e 15-year property f 20-year property 25-year property 25 yrs. S/L It Residential rental 27.5 yrs. MM S/L property 27.5 yrs. MM S/L i Nonresidential real 39 Yrs. MM SIL property MM s Section C-Assets Placed In Service During 2007 Tax Year Using the Alternative Depreciation System 20a Class life �g b 12-year 12 yrs. 5!t. c 40-year 40 yrs. MM S/L I Part IV I Summa 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 insb. ............... ... 22 9, 993 23 For assets shown above and placed in service during the cement year, enter the portion of the basis attributable to section 263A costs 23 For Paperwork Reduction Act Notice, see separate Instructions. Form 4562(2007) DAA There are no amounts for Page 2 P07000 PC & Network Associates, Inc 9/9/2010 7:58 PM 25-1847000 Federal Statements FYE: 12/31/2007 Statement 1 - Form 1120S, Page 1, Item H (4) - Reason for Amended Return Description Return is amended for the following: Correct. for Incorrect value of asset purchased in 2006. The asset was price adjusted in 2007 resulting in a decrease in the basis and related depreciation: Original Basis Reported in 2006 $59, 170 2007 Price adjustment/return ( $38,781) Corrected Basis $20, 389 Depreciation was recalculated and there were other minor decreases in depreciation expense for various other assets Total Decrease in Depreciation Expense $19,512 The original return included rent expense on the 11205 for use of the shareholder's home office. This was was not a part of an accountable plan. Expenses on the return were decreased by $ 11, 477 for these items. The oroginal return included auto expenses for the shareholder which were not a part of an accountable plan. Expenses on the return decreased by $3, 922 for these items. The original return included payroll expenses that were deducted in 2006. Due to a timing difference, the last pay of the year in 2006 was recorded in the 2007 general ledger but it was correctly expensed in 2006. Expenses on the return decreased by $7, 772 for these items . Interest Expense was incensed by $1, 971 for interest expense not included on the original return. Summary: pg 1 line 21 as Originally filed ( $99, 490) Add: Correction for Depreciation $19, 512 Add: Correction for Non Accountable Plan (office) $11,477 Add: Correction for Non Accountable Plan (auto) $ 3 . 922 Add: Correction for error in Payroll $ 7, 547 Add: Non Deductible Meal & Entertainment $ 23 Less: Increase in Interest Expense { $ 1., 971) pg 1, line 21 Corrected 1120S ( $58, 980) Statement 2 - Form 1120S. Page 1. Line 19 - Other Deductions Description Amount Bank Charges $ 4, 676 Dues and Subscriptions 471 Legal & Professional 3, 155 Office Expense 4,067 Outside Services/ Contractors 4, 967 Postage 3, 875 Custodial 120 Telephone 9, 910 Web Hosting Fees 7.15 Trade Publications 21 Auto Mileage Reimb-employees 2, 565 1-2 P07000 PC & Network Associates, Inc 9/9/2010 7:58 PM 25-1847000 Federal Statements FYE: 12/3112007 Statement 2 - Form 1120S. Paae 1. Line 19 - Other Deductions (continued) Description Amount Parking $ 404 Equipment Rental 98 PSA Clearing 986 payroll processing fee 1, 048 Insurance - Workers Comp 2,234 Insurance - Liab & Business 2, 593 Continuing Education 1, 900 Travel 1, 122 Miscellaneous 175 50e of Meals & Entertainment 24 Total $ 44, 526 2 P07000 PC & Network Associates, Inc 9/9/2010 7:58 PM 25-1847000 Federal Statements FYE: 12/31/2007 Statement 3 - Form 11205. Page 2. Schedule A. Line 5 - Other Costs Description Amount inventory adjustment $ -26 Total $ -26 3 P07000 PC & Network Associates, Inc 9/9/2010 7:58 PM 25-1847000 Federal Statements FYE: 12/31/2007 Statement 4 - Form 1120S. Page 4. Schedule L. Line 18 - Other Current Liabilities Beginning End Description of Year of Year sales tax due $ 1, 088 $ 1, 584 Total $ 1, 088 $ 1, 584 Statement 5 - Form 1120S. Page 4. Schedule M-2. Line 5(a) - Other Reductions Description Amount Disallowed Entertainment Exp $ 23 Total $ 23 4-5 P07000 PC & Network Associates, Inc 9/9/2010 7:58 PM 25-1847000 Federal Statements FYE: 12/31/2007 Richard Powell 184-46-5474 Schedule K-1. Box 16, Code C - Nondeductible Expenses Description Amount Page 1 Meals/Entertainment $ 23 Total $ 23 P07000 PC & Network Associates, Inc 09/09/2010 7:58 PM 25-1847000 Federal Asset Report FYE: 12/31/2007 Form 1120S, Page 1 Date Bus Sec Basis Asset Description In Service Cost % 179Bonus for Depr Per Conv Meth Prior Current 5-year GDS Property: 31 HP 2605DN printer 1/30/07 424 424 5 MQ20ODB 0 148 32 HP 2605DN printer 1/30/07 509 509 5 MQ20ODB 0 178 33 HP LaserJet 2300 2/13/07 160 160 5 MQ20ODB 0 56 34 2 APC replacment batteries 11/07/07 333 333 5 MQ20ODB 0 17 35 Various Hardware 12/31/07 664 664 5 MQ20ODB 0 33 2,090 2,090 0 432 Prior MACRS: 21 Flash Drives 2/14/06 201 201 5 HY 20ODB 40 65 23 Linksys Router 5/09/06 143 143 5 HY 20ODB 29 45 27 Brother HL 2040 6/13/06 85 85 5 HY 20ODB 17 27 28 ulare 8125 6/27/06 403 403 7 HY 20ODB 58 98 832 832 144 235 Other Depreciation: I Acer Combo Drive 12/29/03 1,921 1,921 5 M020ODB 1,644 139 2 HP Notebook NX7 12/29/03 3,755 3,755 5 M020ODB 3,214 271 3 Proliant Tower 12/29/03 5,173 5,173 5 M020ODB 4,428 373 4 Various Hardware 12/29/03 2,802 2,802 5 M020ODD 2,398 202 5 Prior Assets 12/31/04 27,690 27,690 5 M020ODB 27,690 0 6 2004 raise equip 1101105 1,109 1,109 5 M020ODB 577 213 7 Shredder 2/21/05 349 349 5 M020ODB 182 67 8 EXB 200 Tape Drive 2/24/05 259 259 5 M020ODB 135 49 9 WDC 250 Hard Drive 3/23/05 291 291 5 M020ODB 151 56 10 Compaq Server 4/19/05 435 435 5 M020ODB 226 84 11 IBM X235 Server 4/14/05 1,075 1,075 5 M020ODB 559 206 12 17" Encvision Monitor 5/19/05 191 191 5 M020ODB 99 37 13 Hard Drives 7/21/05 300 300 5 M020ODB 156 58 14 Samsung Telephone 7/25/05 350 350 7 M020ODB 136 61 15 Sharp Copier/Fax 8115105 355 355 5 M020ODB 185 68 16 LEAPSERV 12/23/05 400 400 5 M020ODB 208 77 17 Office Chairs 3/21/05 1,547 1,547 5 M020ODB 751 319 18 Antique Chairs 4/18/05 509 509 5 M020ODB 247 105 19 Rack Shelving 5110105 384 384 5 M020ODB 187 79 20 6 Desks-Sam's 10/29/05 1,193 1,193 5 M020ODB 580 245 22 Quotewers 5/04/06 792 792 3 MO S/L 176 264 24 Kaseya Software License 5/16/06 20,389 20,389 3 MOAmort 13,149 0 25 MS Action Pack 5/31/06 299 299 3 MOAmort 66 100 26 ConnectWise Soltwrare 6/11/06 17,793 17,793 3 MOAmort 3,460 5,931 29 AVG Anti Virus 6/27/06 774 774 3 MOAmort 151 258 30 Dragon Naturally Speaking 10/01/06 191 191 3 MOAmort 16 64 Total Other Depreciation 90,326 90,326 60,771 9,326 Total ACRS and Other Depreciation 90,326 90,326 60,771 9,326 Grand Totals 93,248 93,248 60,915 9,993 Less: Dispositions 0 0 0 0 Less: Start-up/Org Expensed 0 0 0 0 Net Grand Totals 93,248 93,248 60,915 9,993 P07000 PC & Network Associates, Inc 09/09/2010 7:58 PM 25-1847000 AMT Asset Report FYE: 12/31/2007 Form 1120S, Page 1 Date Bus Sec Basis Asset Description In Service Cost % 179Bonus for Depr Per Conv Meth Prior Current 5-year GDS Property: 31 HP 2605DN printer 1/30/07 424 424 5 MQ 15ODB 0 111 32 HP 2605DN printer . 1/30/07 509 509 5 MQ 15ODB 0 134 33 HP LaserJet 2300 2/13/07 160 160 5 MQ150DB 0 42 34 2 APC replacment batteries 11/07/07 333 333 5 MQ150DB 0 12 35 Various Hardware 12/31/07 664 664 5 MQ150DB 0 25 2,090 2,090 0 324 _Prior MACRS: 6 2004 raise equip 1101105 1,109 1,109 5 HY 15ODB 449 198 8 EXB 200 Tape Drive 2/24/05 259 259 5 HY 150DB 105 46 9 WDC 250 Hard Drive 3/23/05 291 291 5 HY 15ODB 118 52 11 IBM X235 Server 4/14/05 1,075 1,075 5 HY 150DB 435 192 27 Brother HL 2040 6/13/06 85 85 5 HY 150DB 13 21 28 ulare 8125 6/27/06 403 403 7 HY 150DB 43 77 3,222 3,222 1,163 586 Other Depreciation: 1 Acer Combo Drive 12/29/03 1,921 1,921 5 M020ODB 1,644 139 2 HP Notebook NX7 12/29/03 3,755 3,755 5 M020ODB 3,214 271 3 Proliant Tower 12/29/03 5,173 5,173 5 M020ODB 4,428 373 4 Various Hardware 12/29/03 2,802 2,802 5 M020ODB 2,398 202 5 Prior Assets 12/31/04 27,690 27,690 5 MO 150DB 27,690 0 7 Shredder 2/21/05 349 349 5 MO 150DB 142 65 10 Compaq Server 4/19/05 435 435 5 MO 150DB 177 77 12 17" Envision Monitor 5/19/05 191 191 5 MO 150DB 78 34 13 Hard Drives 7/21/05 300 300 5 MO 150DB 122 53 14 Samsung Telephone 7/25/05 650 650 7 M0150DB 181 100 15 Sharp Copier/Fax 8/15/05 355 355 5 M015ODB 144 64 16 LEAPSERV 12/23/05 400 400 5 M0150DB 162 71 17 Office Chairs 3/21/05 1,547 1,547 5 M0150DB 580 298 18 Antique Chairs 4/18/05 509 509 5 M015ODB 191 96 19 Rack Shelving 5110105 384 384 5 MO 15ODB 144 72 20 6 Desks-Sam's 10/29/05 1,193 1,193 5 MO 15ODB 448 223 21 Flash Drives 2/14/06 201 201 5 MO 150DB 55 44 22 Quotewers 5/04/06 792 792 3 MO 150DB 264 264 23 Linksys Router 5/09/06 143 143 5 MO 150DB 29 34 Total Other Depreciation 48,790 48,790 42,091 2,480 Total ACRS and Other Depreciation 48,790 48,790 42,091 2,480 Grand Totals 54,102 54,102 43,254 3,390 Less: Dispositions 0 0 0 0 Less: Start-up/Org Expensed 0 0 0 0 Net Grand Totals 54,102 54,102 43,254 3,390 P07000 PC & Network Associates, Inc 09/09/2010 7:58 PM 25-1847000 Depreciation Adjustment Report FYE: 12/31/2007 All Business Activities AMT Adjustments/ Form Unit Asset Description Tax AMT Preferences MACRS Adjustments: Page l 1 21 Flash Drives 65 44 21 Page 1 1 23 Linksys Router 45 34 11 Page 1 1 27 Brother HL 2040 27 21 6 Page 1 1 28 ulare 8125 98 77 21 Page 1 1 31 HP 2605DN printer 148 111 37 Page 1 1 32 HP 2605DN printer 178 134 44 Page 1 1 33 HP LaserJet 2300 56 42 14 Page 1 1 34 2 APC replacment batteries 17 12 5 Page 1 1 35 Various Hardware 33 25 8 667 500 167 P07000 PC & Network Associates, Inc 09/09/2010 7:58 PM 25-1847000 Future Depreciation Report FYE: 12131108 FYE: 12/31/2007 Form 1120S, Page 1 Date In Asset Description Service Cost Tax AMT Prior MACRS: 21 Flash Drives 2/14/06 201 38 33 23 Linksys Router 5/09/06 143 28 24 27 Brother HL 2040 6/13/06 85 17 16 28 ulare 8125 6/27/06 403 71 61 31 HP 2605DN printer 1130/07 424 111 94 32 HP 2605DN printer 1/30/07 509 132 112 33 HP LaserJet 2300 2/13/07 160 42 35 34 2 APC replacment batteries 11/07/07 333 126 96 35 Various Hardware 12/31/07 664 253 192 2,922 818 663 Other Depreciation: 1 Aeer Combo Drive 12/29/03 1,921 138 138 2 HP Notebook NX7 12/29/03 3,755 270 270 3 Proliant Tower 12/29/03 5,173 372 372 4 Various Hardware 12/29/03 2,802 202 202 5 Prior Assets 12/31/04 27,690 0 0 6 2004 mise equip 1101105 1,109 159 185 7 Shredder 2/21/05 349 46 66 8 EXB 200 Tape Drive 2/24/05 259 35 43 9 WDC 250 Hard Drive 3/23/05 291 37 48 10 Compaq Server 4/19/05 435 53 78 11 IBM X235 Server 4/14/05 1,075 138 179 12 17" Enevision Monitor 5/19/05 191 23 32 13 Hard Drives 7/21/05 300 34 48 14 Samsung Telephone 7/25/05 350 44 81 15 Sharp Copier/Fax 8/15/05 355 41 57 16 LEAPSERV 12/23/05 400 46 56 17 Office Chairs 3/21/05 1,547 212 297 18 Antique Chairs 4/18/05 509 67 95 19 Rack Shelving 5/10/05 384 50 72 20 6 Desks-Sam's 10/29/05 1,193 147 184 22 Quotewers 5/04/06 792 264 198 24 Kaseya Software License 5/16/06 20,389 6,796 5,111 25 MS Action Pack 5/31/06 299 100 75 26 ConnectWise Softwrare 6/11/06 17,793 5,931 4,449 29 AVG Anti Virus 6/27/06 774 258 193 30 Dragon Naturally Speaking 10/01/06 191 63 48 Total Other Depreciation 90,326 15,526 12,577 Total ACRS and Other Depreciation 90,326 15,526 12,577 Grand Totals 93,248 16,344 13,240 P07000 09/09/2010 7:58 PM Retained Earnings Reconciliation Worksheet Form 1120S 2007 For calendar year 2007 or tax year beginning ending Name Employer Identification Number PC & Network Associates Inc 25-1847000 Schedule L - Retained Earnings Retained Earnings-Unappropriated 0 Accumulated Adjustments Account -420,680 Other Adjustments Account 0 Undistributed Previously Taxed Income 0 Schedule L, Line 24-Retained Earnings —420,680 Schedule M-2 - Retained Earnings Accumulated Other Undistrib ted twined Earnin s Total Adjustments Adjustments Previ usly axed UrtapP 9 riated9 Retained Account dccount �ncome Timing bi�erences Earnings Beg YrBal -361, 677 0 0 0 -361,677 Ordinary Inc(Loss) -58,980 -58,980 Other Additions Other Reductions 23 23 Distributions End Yr Bal —420,680 0 0 0 -420,680 P07000 09/09/2010 7:58 PM Form 1120S Schedule K-1 Summary Worksheet 2007 Name Employer Identification Number PC S Network Associates Inc 25-1847000 Shareholder Name ............ Column B ............ Column C ............ Column D Schedule K Column A Column B Column C Column D Sch K Total Items 1 Ordinary income —58, 980 —58,980 2 Net rental RE inc 3c Net other rental inc 4 Interest income 5a Ordinary dividends 5b Qualified dividends 6 Royalties 7 Net ST capital gain 8a Net LT capital gain 810 Collectibles 28% gain 8c Unrecap Sec 1250 9 Net Sec 1231 gain 10 Other income (loss) 11 Sec 179 deduction 12a Contributions 12b Invest interest exp 12c Sec 59(e)(2)exp 12d Other deductions 13a_ Low-inc house 42j5 13b Low-inc house other 13c Qualif rehab ex 13d Rental RE credits 13e Other rental credits 13f Fuel alcohol credit 13g Other credits 14b Gross inc all src 14d-f Total foreign inc 14g-kTotal foreign dads 141 Total foreign taxes 14m Reduct in taxes 15a Dept adjustment 167 167 15b Adjusted gain(loss) 15c Depletion 15d Incoil/qas/geoth 15e Dedoillgas/geoth 15f Other AMT items 16a Tax-exempt interest 16b Other tax-exempt 16c Nonded expense 23 23 16d Total property dist 16e Shr loan repmts 17a Investment income 17b Investment expense 18 Income (loss) -58f980 -58f980 P07000 09/09/2010 7:58 PM Form 1120S Two Year Comparison Worksheet Page 1 2006 & 2007 Name Employer Identification Number PC S Network Associates Inc 25-1847000 2006 2007 Differences Gross profit percentage 66.0404 79.1923 13.1519 ................................... Gross receipts less returns and allowances 286,826 230 602 —56,224 ................. Cost of goods sold 97,405 47 ,983 —49 422 ....................................... Income Gross profit 189,421 182,619 —6 802 ............................................. Net gain or(loss)from Form 4797 ......................... Other income(loss) 237 —237 ...................................... Total income loss 189, 658 182,619 —7 039 Compensation of officers 37,787 37 ,787 ................................. Salaries and wages less employment credits ....... 118,784 77,734 —41 050 ......... Repairs and maintenance 320 —320 ................................. Bad debts ............................................... Rents 25,620 8,820 —16,800 .................................................. Taxes and licenses 14,613 9 123 —5-149-0— ...................................... Deductions Interest 25,845 43,660 17,815 ................................................. Depreciation 13 999 9 993 —4 006 ............................................ Depletion ............................................... Advertising 23 619 9,956 —13 663 .............................................. Pension, profit-sharing, etc., plans ......................... Employee benefit programs 2,364 —2,364 ............................... Other deductions 45,059 44,526 —533 ........................................ Total deductions 308,010 241,599 —66f411 .income loss —118,352 —58,980 59,372 Excess net passive income or LIFO recapture tax ........... Tax from Schedule D ..................................... Total tax 0 0 0 ............................................... Estimated tax and prior year overpayment credited .......... Tax deposited with Form 7004 ............................ Credit for federal tax paid on fuels ......................... Tax and Credit for federal telephone excise tax paid ................. Payments Refund applied for on Form 4466 .......................... Total payments and credits ............................. Tax due(overpayment) 0 0 0 .................................. Estimated tax penalty from Form 2220 ..................... Penalties and interest .................................... Net tax due(overpayment) 0 0 0 .............................. Amt of overpaymet credited to next year's estimated tax Amount of overpayment refunded P07000 09/09/2010 7:58 PM Form 1120S Two Year Comparison Worksheet Page 2 2006 & 2007 Name Employer Identification Number PC & Network Associates inc 25-1847000 2006 2007 Differences Ordinary business income (loss) —118,352 —58 980 59,372 ........................... Net rental real estate income(loss) ........................ Other net rental income (loss) ............................. Interest income .......................................... Income Dividend income ......................................... (Loss) Royalties ............................................... Net short-term capital gain (loss) .......................... Net long-ten capital gain (loss) ........................... Net Section 1231 gain(loss) .............................. Other income loss Section 179 deduction .................................... Other Charitable contributions .................................. Deductions Investment interest expense .............................. Section 59(e)(2)expenditures ............................. Other deductions Low-income housing credit(Section 420)(5)) ................ Low-income housing credit (other) ......................... Qualified rehab expenditures (rental real estate) ............. Credits Other rental real estate credits ............................ Other rental credits ...................................... Credit for alcohol used as fuel ............................. Other credits Total foreign gross income ................................ Foreign Total foreign deductions Transactions .'.............................. Total foreign taxes ....................................... Reduction in taxes available for credit Post-1986 depreciation adjustment 4 167 163 ........................ Adjusted gain or loss ..................................... AMT Depletion (other than oil and gas) .......................... Items Oil, gas, and geothermal properties-gross income ........... Oil,gas,and geothermal properties-deductions .............. Other AMT items Tax-exempt interest income ............................... Items Other tax-exempt income ................................. Affecting Nondeductible expenses 272 23 —249 S/H Basis Property distributions .................................. ..................................... Repayment of loans from shareholders Investment income ....................................... Other Investment expenses Information . . ..id.fro ............................. Dividend distributions paid from accum E8P Income loss if Sch M-1 is required) —118,352 —58,980 59 372 P07000 091098010 7:58 PM Form 1120S Two Year Comparison Worksheet Page 3 2006 & 2007 Name Employer Identification Number PC & Network Associates Inc 25-1847000 2006 2007 Differences Beginning assets 22 818 93 841 71 023 ........................................ Schedule Beginning liabilities and equity 22,818 93,841 71,023 ............................. L Ending assets 56,595 32,571 —29 024 ........................................... Ending liabilities and equity 56,595 3-2- 571 —24,024 ....................... ............ Net Income per books —118,616 —59,006 59,610 . Taxable income not on books ............................. Schedule Book expenses not deducted 272 -272 .............................. M-t Income on books not on return ............................ Return deductions not on books 8 -8 ........................... Income per retum —118,352 —58, 980 59,372 Balance at beginning of year -245,195 —361,677 —116,482 .............................. Schedule Ordinary income poss)from page t, line 21 —118,352 —58, 980 59,372 M-2 Other additions .......................................... AAA Other reductions 272 23 -249 ......................................... Distributions other than dividend distributions ............... Balance at end of year —363 819 —420,680 —56,861 Balance at beginning of year .............................. Schedule Other additions .......................................... M-2 Other reductions ......................................... OAA Distributions other than dividend distributions ............... Balance at end of year ................................... Schedule Balance at beginning of year .............................. M-2 Distributions other than dividend distributions ............... PTI Balance at end of year Total Income (loss)items: Income(loss)per income statement ...................... Temporary difference ................................... Permanent difference .................................. Income(loss)per tax return ............................. Total expenseldeduction items: Expense per income statement .......................... Temporary difference ................................... Schedule Permanent difference M-3 .................................. Deduction per tax return ................................ Other items with no differences: Income(loss)per Income statement ...................... Income(loss)per tax return ............................. Reconciliation totals: Income(loss)per Income statement ...................... Temporary difference ................................... Permanent difference .................................. Income loss per tax return P07000 09/0912010 7:58 PM Shareholder's Basis Worksheet Page 1 Form 1120S 2007 Schedule K-1 For calendar year 2007 or tax year beginning ,ending Name PC & Network Associates, Inc Taxpayer Identification Number 25-1847000 Richard Powell Stock Basis 1. Beginning of year stock basis 0 ............................................................................................. 2. Capital contributions ..................................................................................................... Additions: 3. Ordinary business income ........................................................................ 4. Net rental real estate income ..................................................................... 5. Other net rental income .......................................................................... 6. Interest, dividends and royalties ................................................................... 7. Net capital gains ................................................................................ 8. Net section 1231 gain ........................................................................... 9. Tax-exempt interest and other income ............................................................. 10. Other income .. ...... ...... ........................................................ 11. Other increases Additional PIC 4,318 12. Subtotal (Add line 1 through line 11) ....................................................................................... 4,318 Subtractions: 13. Distributions ............................................................................................................ 14. Total losses and deductions applied against stock basis (See Shareholders Basis Worksheet Page 2) 4,318 15. Other decreases 16. Amount used to restore loan basis ........................................................................................ 17. End of year stock basis (Subtract the sum of lines 13 through 16 from line 12). 0 ................................................. Loan Basis 18. Beginning of year loan basis 0 .............................................................................................. 9. Loans to corporation .................................................................................................... 41,249 20. Loan basis restored-amount used in prior years to offset losses ............................................................. 21. Other increases 22. Loan repayments ....................................................................................................... 23. Total losses and deductions applied against loan basis (See Shareholders Basis Worksheet Page 2) 41,249 24. Other decreases 25. End of year loan basis (Subtract the sum of lines 22 through 24 from the sum of lines 18 through 21) 0 ............................. 26. End of year stock and loan basis (Add line 17 and line 25) 0 Gain Recognized on Excess Distributions 27. Distributions ............................................................................................................ 28. Stock basis before distributions and loss items 29. Gain recognized on excess distributions (Subtract line 28 from line 27) ..._..._.___..._._......... .. .. .................... Gain Recognized on Repayment of Shareholder Loan 30. Loan basis at beginning of tax year........................................................................................ 31. Basis restored-amount used in prior years to offset losses 32. Loan basis before loan repayment (Add line 30 and line 31) .................................................................. 33. Face amount of shareholder loan at beginning of tax year 34. Loan repayments to shareholder during tax year 35. Nontaxable return of loan basis ((Line 32 divided by line 33)multiplied by line 34)) 36. Gain recognized on repayment of shareholder loan (Subtract line 35 from line 34) ............................................ Note to shareholder: This worksheet was prepared based on corporation records. Please consult with your tax advisor for adjustments. M io m c r N N in N a m dO o m 0 b i oH � N N N Ho M M M n NJ H H H � O U C a N Ol Ol J y N N N J v C v O Q 0 O 2 2 O O O y a rn o .y ro m O .Nd a m rn rn C u H M M M N = J ac a 0 E � v C E (L M N M N m Y u N Ol O\ m a y 0 o N N M N y N d J y ` O o o' O 0 < m M O a O O O1 O O t5 y c o N G 2 o rn o o r Q N c O O i N N H 0 J o o m m m 0 J N rl 'i d d N L 2 a N aOD m o g c O O E N e J m CO 0 N J u) UI ul `o m a ro U 0 m w 3 $4 N m o a a m r N $ o 0 o d m Ep o a o a x n 3 U C d L N E y V N O W C C '? ? O N O O m O � 6 y N y EL 0 N m '� .0 E w d m `� `5 o y m E E 2 `�' E a r p U r d W a m y O N U J a O E r� t rn m o $ 2 n i OE 16 W 0 L O m m O z 0 n 0 E E z 0 U U z z U U m a m N E c r 0, ii o m m z 0 F o Z I I I I Z P07000 PC & Network Associates, Inc 9/9/2010 7:58 PM 25-1847000 Federal Statements FYE: 12/31/2007 Form 1120S. Page 1. Line 1a - Gross Receipts Description Amount Gross Sales $ 237, 334 Less: Sales Tax -607 Total $ 236, 727 Form 1120S. Page 1. Line 1b - Returns and Allowances Description Amount $ 6, 125 Total $ 6, 125 Form 1120S. Page 1. Line 12 - Taxes and Licenses Description Amount payroll taxes $ 9, 123 Total $ 9, 123 Form 1120S. Page 1. Line 13 - Interest Description Amount Loan Interest $ 21, 916 Credit Card Interest/Finance 21,744 Total $ 43, 660 P07000 PC & Network Associates, Inc 9/9/2010 7:58 PM 25-1847000 Federal Statements FYE: 12/31/2007 Form 1120S. Page 3. Schedule K. Line 16c - Nondeductible Expenses Description Amount Page 1 Meals/Entertainment $ 23 Total $ 23 P07000 PC & Network Associates, Inc 9/9/2010 7:58 PM 25-1847000 Federal Statements FYE: 12/31/2007 Form 1120S. Page 4. Schedule L. Line 3 - Inventories Beginning End Description of Year of Year Inventory $ 180 $ 200 Total $ 180 $ 200 Form 1120S. P4. Sch L. Line 17 - Mortgages. Notes Bonds Pay in Less Than One Yr Beginning End Description of Year of Year Credit Cards - PCNAI & RWP $ 135, 652 $ 175, 666 Line of Credit - RWP 50, 174 50, 869 Licenses Note 1, 364 Adjustment -4, 727 Total $ 182, 463 $ 226, 535 Form 11205. Page 4. Schedule L. Line 19 - Loans from Shareholders Beginning End Description of Year of Year Loan from RWP $ 44, 297 $ 59, 996 Total $ 44, 297 $ 59, 996 Form 1120S. P4. Sch L. Line 20 - Mortgages. Notes Bonds Pay in One Year or More Beginning End Description of Year of Year SBA loans $ 167, 968 $ 148, 630 Total $ 167, 968 $ 148, 630 Form 11205. Page 4. Schedule L. Line 23 - Additional Paid-In Capital Beginning End Description of Year of Year Additional PIC $ 6, 829 $ 9, 006 Additional PIC 45, 373 Total $ 52, 202 $ 9, 006 P07000 09/0912010 7:21 PM Foml 1120S U.S. Income Tax Return for an S Corporation OMB No.15450130 ► Do not file this form unless the corporation has filed or is 2008 Department of the Treasury attaching Form 2553 to elect to be an S corporation. v Internal Revenue Service ► See separate instructions. For calendar year 2008 or tax ear be innin ,ent in A S election effective sate Name D Employer identification number 10/12/99 IRS PC & NETWORK ASSOCIATES INC 25-1847000 B Business activity code label. Number,street,and room or suite na.If a P.O.box,see instructions. E Date incorporated number(see instructions) Other- wise, 541519 print or 1166 YOUNG ROAD 10/12/1999 C Check if Sch.M-3 type. City or[own,state,and ZIP code F Total assets(see instructions) attached ❑ PUNXSUTAWNEY PA 15767 $ 18, 010 G Is the corporation electing to be an S corporation beginning with this tax year? ❑ Yes ❑X No If"Yes,"attach Form 2553 if not already fled H Check if: (1) Final return (2) ❑ Name change (3) ❑ Address change (4) eX Amended return STMT 1 (5) ❑ S election termination or revocation I Enter the number of shareholders who were shareholders during any pad of the tax year 11, 1 .................................................... Caution. Include only trade or business income and expenses on lines la through 21. See the instructions for more information. Is Gross receipts or sales 324, 3641 b Less returns and allowances I 3, 102 cBat► tc 321 262 10 2 Cost of goods sold(Schedule A,line 8) ...................................................................... 2 79 042 0 3 Gross profit.Subtract line 2 from line lc ..................................................................... 3 242 220 C 4 Net gain(loss)from Form 4797, Part II,line 17(attach Form 4797) 4 5 Other income (loss) (see instructions—attach statement) 5 ...................................................... 6 Total income(loss). Add lines 3 through 5.............................................................— ► 6 242, 220 7 Compensation of officers ................................................................................... 7 37, 787 8 Salaries and wages(less employment credits) ................................................................ 8 36, 669 9 Repairs and maintenance .................................................................................. 9 A10 Bad debts ........................—...................................................................... 10 11 Rents ...................._.............................................................................. 11 12 Taxes and licenses ........................................................................................ 12 8, 233 z13 Interest ................................................................................................... 13 41 001 m 14 Depreciation not claimed on Schedule A or elsewhere on return (attach Form 4562) 14 20, 310 A 15 Depletion (Do not deduct oil and gas depletion.) 15 in 16 Advertising 16 1 076 ............................................................................................... 0 17 Pension, profit-sharing, etc., plans 17 ........................................................................... u 18 Employee benefit programs 1s ............................................................... ......... 19 Other deductions (attach statement) SEE STMT 2 19 48, 371 0 20 Total deductions. Add lines 7 through 19 , ... ... ........ ......... ,,,.,,, ► 20 19 3 447 21 Ordinary business income (loss). Subtract line 20 from line 6 ................................................. 21 4 8 773 22a Excess net passive income or LIFO recapture tax(see instructions) 22a b Tax from Schedule D(Form 1120S) 22b ........................................... c Add lines 22a and 22b(see instructions for additional taxes) ......... ........__..._.... 22c ............................. . E23a 2008 estimated tax payments and 2007 overpayment credited to 2008 23a Ab Tax deposited with Form 7004 ................................................ 23b d c Credit for federal tax paid on fuels(attach Form 4136) 23c ........................... v d Add lines 23a through 23c 23d C .......................................................................... A 24 Estimated tax penalty(see instructions).Check if Form 2220 is attached ► ❑ 24 K ...a.......................... � 25 Amount owed. 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 from line 26 Credited to 2009 estimated tax► Refunded ► 27 Under penalties of pequry,I declare that I have examined this retum,including accompanying schedules and statements, May the IRS diswss this hi wAh the preparer and to the best of my knowledge and belief,it is true,correct,and complete.Declaration of preparer(other than taxpayer) Sign is based on all information of which preparer has any knowledge. sham been see instructions? X Yes No Here ' ' PRESIDENT Signature of officer RICHARD POWELL Date Title Preparers Date Check if Preparers SSN or PTIN Paid signature MONIQUE M. ERICSON 9/09/10 salt-employed 0 P00230493 Preparees Firms name ERICSON ACCOUNTING SERVICES FIN 13-4215201 Use Only yours if self-employed), 2 05 HEMLOCK RD Phone no address,and ZIP code NEW CUMBERLAND PA 17070-2826 717-514-0149 For Privacy Act and Paperwork Reduction Act Notice,see separate instructions. Form 1120S(2008) DA P07000 0910912010 721 PM Form 11205(2008) PC & NETWORK ASSOCIATES, INC 25-1847000 Page 2 Schedule A Cost of Goods Sold see instructions 1 Inventory at beginning of year................................................................................. 1 200 2 Purchases .................................................................................................. 2 7 9 042 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 79, 242 ............................. ............................................... 7 Inventory at end of year ...................................................................................... 7 200 8 Cost of goods sold. Subtract line 7 from line 6.Enter here and on page 1,line 2 8 79, 042 ................................... 9a Check all methods used for valuing dosing inventory: (1) ❑ Cost as described in Regulations section 1.471-3 (ii) Lower of cost or market as described in Regulations section 1.4714 (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 Forth 970) ..................................... ► d If the LIFO inventory method was used for this tax year,enter percentage(or amounts)of dosing Inventory computed under LIFO ................................................................................ I 9d e If property is produced or acquired for resale,do the rules of section 263A apply to the corporation? . . . ............... Yes X No f Was there any change in determining quantities, cost,or valuations between opening and dosing inventory? Yes X No If"Yes,*attach explanation. Schedule B Other Information see instructions Yes No 1 Check accounting method: a X Cash b Accrual c U Other(specify) ► ...................................... 2 See the instructions and enter the: a Business activity ► .....COMPUTER $ IT SERV b Product or service ► COMPUTER & IT SERV 3 At the end of the tax year,did the corporation own,directty or indirectly,50%or more of the voting stock of a domestic corporation?(For rules of attribution, we section 267(c).) If"Yes,"attach a statement showing: (a)name and employer identification number (EIN), (b) percentage owned,and(c)if 100%owned,was a OSub election made? X ................................. 4 Has this corporation filed,or is it required to file,a return under section 6111 to provide information ortab on any reportable bansaction? .................................................................................................................... X 5 Check this box if the corporation issued publicly offered debt instruments with original issue discount ............................. ► ❑ If checked,the corporation may have to file Forth 8281, Information Return for Publicly Offered Original Issue Discount Instruments. 6 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 recognlzed bullt-In gain from prior years ......................................................................................... ► $ ......................... 7 Enter the accumulated earnings and profits of the corporation at the end of the tax year. $ 8 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. ........................................ LL ,,Schedule K Shareholders' Pro Rata Share Items Total amount 1 Ordinary business income(loss)(page 1,line 21) ........................................................ 1 48, 773 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 M 0 4 Interest Income ....................................................................................... 4 2 6 mJ 5 Dividends: a Ordinary dividends 5a ........................................................................ E b Oualified dividends 5b a ......................................... u E 6 Royalties ............................................................................................ 5 7 Net short-term capital gain(loss)(attach Schedule D(Form 11208)) ........................................ 7 8a Net long-term capital gain (less)(attach Schedule D(Form 11205)) ..................................... .. 6a b Collectibles(28%)gain (loss) ............................................ Bb m c Unrecaptured section 1250 gain (attach stateent) Bc 9 Net section 1231 gain(low)(attach Form 4797) .......................................................... 9 10 Other income loss see instructions T ► 10 Form 11205(2oo8) DM P07000 09/09/2010 7:21 PM Form 1120S2008 PC & NETWORK ASSOCIATES INC 25-1847000 Page Shareholders' Pro Rata Share hems(continued) Total amount 11 Section 179 deduction(attach Form 4562) 11 ..................................... 0 12a Contnbutions 12a ....................................................................................... a' b Investment interest expense ................................... o c Section 59(e)(2) expenditures (1)Type ► (2)Amount ► 12c 2 d Other deductions see instructions ................ T e► 12d 13a Low-income housing credit(section 42(j)(5)) ............... _ ,,...._.._..__..............,_ __ 13a b Low-income housing credit (other) ..... - 13b ............................................................... 2 c Qualified rehabilitation expenditures (rental real estate) (attach Form 3468) 13c d d Other rental real estate credits(see instructions) Type► 13d .................. tL) a Other rental credits(see instructions) Type► 13e f Alcohol and cellulosic biofuel fuels credit(attach Form 6478) 13f Other credits see instructions .................... Type ► 13 14a Name of country or U.S. possession ► b Gross income from all sources 14b ....................................................................... c Gross income sourced at shareholder level ............................................................ 14c Foreign gross income sourced at corporate level d Passive category ....................._............................................................ 14d e General category 14e 9 ................................................................._................ 0 If Other(attach statement) ............................................................................. 14f m Deductions allocated and apportioned at shareholder level c 9 Interest expense .................................................................................... 1 c� h Other.............................................................................................. 14h Deductions allocated and apportioned at corporate level to foreign source income LL i Passive category ................................................................................... 14i jGeneral category ................................................................................... 14 k Other(attach statement) ............................................................................. 14k Other information 1 Total foreign taxes(check one): ► ❑ Paid ❑ Accrued 141 m Reduction in taxes available for credit(attach statement) 14m n Other foreign tax information attach statement ........................................................ 15a Post-1986 depreciation adjustment ................................................................... 15a 155 b Adjusted gain or loss ................................................................................ 15b m E= c Depletion(other than oil and gas) 15c EECd Oil, gas, and geothermal properties-gross income ,,,,,,,,,,,,,,,,,,,_._...__._..._..__.._._.._..._._. 15d 6 ¢ a Oil,gas,and geothermal properties-deductions 15e ......................................................... f Other AMT items attach statement .................................................................. 15f 16a Tax-exempt interest income 16a _m .................................................................... Ty+2 m b Other tax-exempt income 16b N,FL ............................................................................ Q m c Nondeductible expenses ............................................................................. 16c 12 E=m d Property distributions ............ ..._ ...................................... w °= a Repayment of loans from shareholders .......................... c 17a Investment income - 17a 26 ................................................................................. 0% b Investment expenses ...................................... 17b S o c Dividend distributions paid from accumulated earnings and profits 17c d Other items and amounts attach statement)EE TATEMENT 3 0 3�7'a 18 Incomelloss reconciliation. 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 141 .._. __.._... 18 48, 799 Form 1120$(2008) DA4 P07000 09N92010 7:21 PM Form 112052006 PC & NETWORK ASSOCIATES INC 25-1847000 Page Schedule L Balance Shaets per Books Beginning of tax year End of ax year Assets a b c d 1 Cash ......................._.......... 1 405 524 - -- - - --- 2a Trade notes and accounts receivable to Less allowance for bad debts .............. 3 Inventories 200 2 0 0 .............................. 4 U.S.government obligations ............... 5 Tax-exempt securities(see instructions) 6 War anent asset(attach satennM) ............... 7 Loans to shareholders .................... 8 Mortgage and real estate loans ............ 9 Q*h'.estevt(attach statement) ................ _ _ -- 10a Buildings and other depreciable assets 93, 248 99, 878 b Less accumulated depreciation 62 282 30, 966 82, 592 17, 286 ............ tta Deplelable assets ........................ - Is 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 ............................. 32 571 18, 010 Liabilities and Shareholders' Equity 16 Accounts payable ........................ 17 Mortgages,notes,bonds payable in less than 1 year 226, 535 202, 309 1e Omar aamnt lawks(adarh downentl STMT 4 1 584 1 654 .............. 19 Loans from shareholders 59, 996 .................. 20 Mortgages,notes,bonds payable:, ayable in 1 year a more 148, 630 127 517 21 Other liabilities(attach statement) .............. 22 Capital stock 7, 500 7, 500 ............................. 23 Additional paidin capital 9 006 50 923 .................. 24 Retained earnings ,...,...,............... —420 680 —371 893 25 Adjustments to shareholders' equity(attach statement) ..................... 26 Less cost of treasury stock ................ 27 Total liabilities and shareholders' equity ..... 32 571 18, 010 Schedule_ M-1, Reconciliation of Income (Loss) per Books With Income (Loss) per Return Note: Schedule M-3 moui red instead of Schedule M-1 if total assets are$10 million or morn—see instructions 1 Net income(loss)per books 4$ 7 8 6 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,Be.9,and 10,not recorded on books this a Tax-exempt interest $ ....................... year(itemize): ........................ 3 Expenses recorded on books this year not 6 Deductions included on Schedule K, lines included on Schedule K,lines 1 through 12 1 through 12 and 141,not charged against and 141(itemize): book income this year(itemize): a Depreciation $ 1 a Degradation $ ........................ to 7ra.el end en erainment $ .................... 12 ............. 13 7 Add lines 5 and 6 4 Add lines 1 tbrou n 3 48, 7 9 9 8 Income Schedule line 1e.Lim 4 less line 7 48, 799 ;Schedule M-2; Analysis of Accumulated Adjustments Account, Other Adjustments Account, and Shareholders' Undistributed Taxable Income Previous) Taxed see instructions (a)Accumulated (b)Other adjustments (c)Shareholders'undistributed adjustment account acaoum taxable Income previously laced 1 Balance at beginning of tax year —420 680 2 Ordinary income from page 1,line 21 48, 773 3 Other additions STMT 5 26 .......................... 4 Loss from page 1,line 21 5 Other reductions STMT 6 12 ......................... 6 Combine lines 1 through 5 —371, 893 7 Distributions other than dividend distributions 8 Balance at end of tau year.Subtract line 7 from line 6 —37 1 8 93 DAA Form 11205(2008) P07000 09109/2010 721 PM 671108 ElFinal K-1 Amended K-1 OMB No.1515-0130 Schedule K-1 2008 Part Ill Shareholder's Share of Current Year Income, (Form 1120S) For calendar year 2009,or tax Deductions Credits and Other Items Department of the Treasury year begtnni g 1 Ordinary business Income(loss) 13 Credits Internal Revenue Service ending 48, 773 2 Net rental real estate Income(loss) Shareholder's Share of Income, Deductions, Credits, etc. k Sao back of form and separate Instructions. 3 Other net rental Income(loss) Part I Information About the Corporation a Interest income A Corporation's empkryer Identification number 26 25-1847000 Sa Ordinary dividends B Corporation's name,address,city.state,and ZIP code PC & NETWORK ASSOCIATES, INC 51, Qualified dividends 14 Foreign transactions 1166 YOUNG ROAD 8 Royalties PUNXSUTAWNEY PA 15767 C IRS Center where corporation filed return 7 Net short-term capital gain(loss) CINCINNATI OH 45999 FP—a—ri-1111 Information About the Shareholder 9a Net long-term capital gain(loss) D Shareholders E Shareholders name,address,city,state,and ZIP code 8c Unrecaptured section 1250 gain RICHARD POWELL C/O MICHAEL POWELL, EXECUTOR 9 Net section 1231 gain(loss) 1166 YOUNG RD PUNXSUTAWNEY PA 15767 10 Other Income(loss) 15 Alternative minimum tax(AMT)items F Shareholders percentage of stock A 155 ownorship for tax year 100. 000000 % ' 11 Section 179 deduction 16 Items affecting shareholder basis 1 12 Omer deductions C* 12 r 0 m ' D LL 17 Other information A 26 T* STMT " See attached statement for additional information. For Paperwork Reduction Act Notice,see Instructions for Form 11205. Schedule K-1 (Form 1120S)2008 DAA P07000 091092010 7:21 PM Fora, 4562 Depreciation and Amortization rAnUaChment o.1545-0172 (Including Information on Listed Property) 008 Department of the Treasury Internal Revenue Service 67 (99) ► See separate instructions. ►Attach to our tax return. ce No. Name(s)shown on return Identifying number PC & NETWORK ASSOCIATES INC 25-1847000 Business or activity to which this form relates REGULAR DEPRECIATION L Part I 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 the instructions for a higher limit for certain businesses .... .... ....... .. .. 1 250, 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(see instructions) 3 800, 000 4 Reduction in limitation. Subtract line 3 from line 2. If zero or less,enter-0- 4 .......................................... 5 Dollar limitaton for tax year.Subtract lure 4 from lure 1.If zero or less enter�.8 married filing separately,see inshations ............ 5 (a)Desorption of property (b)Cost(business use only) (c)Elected cost 6 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 2007 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 mom than line 11 ,,,,, .. 12 13 Carryover of disallowed deduction to 2009.Add lines 9 and 10 less line 12 ► 13 Note: Do not use Part It or Part III below for listed property.Instead,use Part V. i Part 11 1 Special Depreciation Allowance and Other Depreciation Do not include listed proDe . Be S instructions. 14 Special depredation allowance for qualified property(other than listed property)placed in service during the tax year(see instructions) ........................................................................... 14 3, 317 15 Property subject to section 168(f)(1)election .................................................................... 15 16 Other depreciation (including ACRS ........................................................................... 16 15 526 I Part III I MACRS Depreciation (Do not include listed property.) (See instructions.) Section A 17 MACRS deductions for assets placed in service in tax years beginning before 2008 ,,,.,,....,ou,,,,,,,,,,,,,,,,,, 17 818 18 If you are electing to group any assets placed in service during the tax year into one or more general asset aCNUnis,check here► I 1 Section B—Assets Placed in Service During 2008 Tax Year Using the General Depreciation System (b) Month and (c) Bash far depredation d Recovery (a) Classification of property yeas pl M (bunessbn Instruction) ( )period (o) Convention (f) Method (g) Depreciation deduction Or 19a 3-year property b 5-year ro 3, 109 5 .0 HY 20ODB 619 C 7-year property 204 7 .0 HY 20ODB 30 d 10 ear property e 15 ear property f 20-year property 25-year property 25 yrs. S/L In Residential rental 27.5 M. MM S/L property 27.5 yrs. S/L i Nonresidenfial real 39 MM S/L property MM S/L Section C—Assets Placed in Service During 2008 Tax Year Using the Alternative Depreciation System 20a Class life S2 b 12-year 12 yrs. S/L c 40-year 40 yrs. MM S/L M Part IV I Summa 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 20, 310 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 45612(2W8) DAA THERE ARE NO AMOUNTS FOR PAGE 2 P07000 PC & Network Associates, Inc 9/9/2010 7:21 PM 25-1847000 Federal Statements FYE: 12/31/2008 Statement 1 - Form 1120S. Page 1. Item H 141 - Reason for Amended Return Description THE RETURN IS BEING AMENDED FOR THE FOLLOWING: DECREASE IN DEPRECIATION EXPENSE RESULTING FROM AN ASSET PURCHASED IN 2006 WHERE THE PRICE WAS LATER ADJUSTED IN 2007 . ALSO OTHER ASSETS WERE CAPIALIZED AS PART OF IS AMENDMENT. NET DECREASE IN DEPRECIATION EXPENSE: $8, 157 THE ORIGINAL RETURN INCLUDED RENT EXPENE FOR A NON ACCOUNTABLE PLAN. THE AMENDED RETURN REDUCES RENT EXPENSE. DECREASE IN RENT EXPENSE: $13, 595 THE ORIGINAL RETURN REPORTED INCORRECT WAGES AND PAYROLL TAXES. THE SHAREHOLDERS WAGES WERE ERRONEOUSLY INCLUDED IN BOTH LINE 1 AND LINE 2. ADDITIOANLLY PAYROLL TAXES AND PROCESSING FEES ARE SEPARATELY REPORTED IN THE AMENDED RETURN. DECREASE IN WAGE EXPENSE: $37, 787 THE SHAREHOLDER INCLUDED INTEREST EXPENSE ON SHAREHOLDER LOANS WHERE THE INTEREST WAS NOT PAID TO THE SHAREHOLDER BY THE CORPORATION AND PRINCIPAL PAYMENTS WERE EXPENSED AS INTEREST IN ERROR. DECREASE IN INTEREST EXPENSE: $4, 147 THE ORIGINAL RETURN INCLUDED UTILITIES EXPENSE OF THE SHAREHOLDER THAT WAS NOT PART OF AN ACCOUNTABLE PLAN. DECREASE IN UTILITIES EXPENSE: $8, 509 THE ORIGINAL RETURN INCLUDED OTHER EXPENSES (NON ACCOUNTABLE) THAT COULD NOT BE DOCUMENTED IN THE AMOUNT OF $10, 510. OTHER DECREASE IN EXPENSES: $10,510 SUMMARY OR ADJUSTMENTS: PG 1, LINE 21 ORIGINALLY REPORTED LOSS ( $33, 932) ADD: DECREASE IN DEPRECIATION EXPENSE $ 8, 157 ADD: DECREASE IN RENT EXPENSE $13, 595 ADD: DECREASE IN SALARIES AND WAGES $33, 787 ADD: DECREASE IN INTEREST EXPENSE $ 4, 147 ADD: DECREASE IN UTILITIES EXPENSE $ 8, 509 ADD: OTHER DECREASE IN EXPENSES $10, 510 PG 1, LINE 21, AMENDED RETURN INCOME $48,773 Statement 2 - Form 1120S. Page 1. Line 19 - Other Deductions Description Amount BANK CHARGES $ 4,234 DUES AND SUBSCRIPTIONS 455 LEGAL & PROFESSIONAL 13, 196 OFFICE EXPENSE 3, 426 1-2 P07000 PC & Network Associates, Inc 9/9/2010 7:21 PM 25-1847000 Federal Statements FYE: 12/31/2008 Statement 2 - Form 11205. Page 1. Line 19 - Other Deductions (continued) Description Amount OUTSIDE SERVICES/ CONTRACTORS $ 9, 341 POSTAGE 548 TELEPHONE 4, 648 WEB HOSTING FEES 25 TRADE PUBLICATIONS 37 AUTO MILEAGE REIMB 4, 002 PARKING 14 EQUIPMENT RENTAL 82 PSA CLEARING 3, 995 PAYROLL PROCESSING FEE 974 INSURANCE - WORKERS COMP 547 INSURANCE - LIAB & BUSINESS 2,230 TOLLS 70 MISCELLANEOUS 534 50% OF MEALS & ENTERTAINMENT 13 TOTAL $ 48,371 2 P07000 PC & Network Associates, Inc 9/9/2010 7:21 PM 25-1847000 Federal Statements FYE: 12/31/2008 Statement 3 - Form 1120S. Page 3. Schedule K. Line 17d - Other Items and Amounts Description Amount INTEREST FROM U.S. OBLIGATIONS $ 26 3 P07000 PC & Network Associates, Inc 9/9/2010 7:21 PM 25-1847000 Federal Statements FYE: 12/31/2008 Statement 4 - Form 1120S. Paae 4. Schedule L. Line 18 - Other Current Liabilities Beginning End Description of Year of Year SALES TAX DUE $ 1, 584 $ 1, 654 TOTAL $ 1, 584 $ 1, 654 Statement 5 - Form 1120S. Paae 4. Schedule M-2. Line 3(a) - Other Additions Description Amount INTEREST INCOME $ 26 TOTAL $ 26 Statement 6 - Form 1120S. Page 4. Schedule M-2. Line 5(a) - Other Reductions Description Amount DISALLOWED ENTERTAINMENT EXP $ 12 TOTAL $ 12 4-6 P07000 PC & Network Associates, Inc 9/9/2010 7:21 PM 25-1847000 Federal Statements FYE: 12/31/2008 Richard Powell Schedule K-1. Box 16,Code C - Nondeductible Expenses Description Amount PAGE 1 MEALS/ENTERTAINMENT $ 12 TOTAL $ 12 Schedule K-1, Box 17, Code T - Other Information Shareholder Description Amount GAIN ON REPAYMENT SHR LOAN 25, 100 INTEREST FROM U.S. OBLIGATIONS 26 P07000 PC & Network Associates, Inc 09/09/2010 7:21 PM 25-1847000 Federal Asset Report FYE: 12/31/2008 Form 1120S, Page 1 Date Bus Sec Basis Asset Description In Service Cost %0 1796onus for Depr PerConv Meth Prior Current 5-year GDS Property: 36 Buffalo 320 GB NAS 1/10/08 159 X 79 5 HY 20ODB 0 95 37 Buffalo 500 GB NAS 1/13/08 259 X 129 5 HY 20ODB 0 155 38 Compaq ML 370 3/13/08 500 X 250 5 BY 20ODB 0 300 39 Unisys e-action Ent Server 3/25/08 750 X 375 5 HY 20ODB 0 450 40 Unisys E-action ent server 4/15/08 850 X 425 5 HY 20ODB 0 510 41 Maxtor 750 GB USB Crive 4/15/08 117 X 58 5 HY 20ODB 0 70 44 Seagate ITB USB Drive 12/10/08 140 X 70 5 HY 20ODB 0 84 45 Unisys Dell 7/30/08 1,200 X 600 5 HY 20ODB 0 720 46 HPD530 7/30/08 553 X 276 5 HY 20ODB 0 332 47 Hp D515 (3) 7/30/08 1,694 X 847 5 HY 20ODB 0 1,016 6,222 3,109 0 3,732 7-year GDS Property: - 42 Portable AC Unit 6/28/08 260 X 130 7 HY 20ODB 0 149 43 Portable AC Unit 7/06/08 148 X 74 7 HY 20ODB 0 85 408 204 0 234 Prior MACRS: 21 Flash Drives 2/14/06 201 201 5 HY 20ODB 105 38 23 Linksys Router 5/09/06 143 143 5 HY 20ODB 74 28 27 Brother HL 2040 6/13/06 85 85 5 HY 20ODB 44 17 28 ulare 8125 6/27/06 403 403 7 HY 20ODB 156 71 31. HP 2605DN printer 1/30/07 424 424 5 MQ20ODB 148 111 32 HP 2605DN printer 1/30/07 509 509 5 MQ20ODB 178 132 33 HP LaserJet 2300 2/13/07 160 160 5 MQ20ODB 56 42 34 2 APC replacment batteries 11/07/07 333 333 5 MQ20ODB 17 126 35 Various Hardware 12/31/07 664 664 5 MQ20ODB 33 253 2,922 2,922 811 818 Other Depreciation: 1 Acer Combo Drive 12/29/03 1,921 1,921 5 M020ODB 1,783 138 2 HP Notebook NX7 12/29/03 3,755 3,755 5 M020ODB 3,485- 270 3 Proliant Tower 12/29/03 5,173 5,173 5 M020ODB 4,801 372 4 Various Hardware 12/29/03 2,802 2,802 5 M020ODB 2,600 202 5 Prior Assets 12/31/04 27,690 27,690 5 M020ODB 27,690 0 6 2004 raise equip 1/01/05 1,109 1,109 5 M020ODB 790 159 7 Shredder 2/21/05 349 349 5 M020ODB 249 46 8 EXB 200 Tape Drive 2/24/05 259 259 5 M020ODB 184 35 9 WDC 250 Hard Drive 3123/05 291 291 5 M020ODB 207 37 10 Compaq Server 4/19/05 435 435 5 M020ODB 310 53 11 IBM X235 Server 4/14/05 1,075 1,075 5 M020ODB 765 138 12 17" Encvision Monitor 5/19/05 191 191 5 M020ODB 136 23 13 Hard Drives 7/21/05 300 300 5 M020ODB 214 34 14 Samsung Telephone 7/25/05 350 350 7 M020ODB 197 44 15 Sharp Copier/Fax 8/15/05 355 355 5 M020ODB 253 41 16 LEAPSERV 12/23/05 400 400 5 M020ODB 285 46 17 Office Chairs 3/21/05 1,547 1,547 5 M020ODB 1,070 212 18 Antique Chairs 4/18/05 509 509 5 M020ODB 352 67 19 Rack Shelving 5/10/05 384 384 5 M020ODB 266 50 20 6 Desks-Sam's 10/29/05 1,193 1,193 5 M020ODB 825 147 22 Quotewers 5/04/06 792 792 3 MO S/L 440 264 24 Kaseya Software License 5/16/06 20,389 20,389 3 MOAmort 13,149 6,796 25 MS Action Pack 5/31/06 299 299 3 MOAmort 166 100 26 ConnectWise Softwmre 6/11/06 17,793 17,793 3 MOAmort 9,391 5,931 29 AVG Anti Virus 6/27/06 774 774 3 MOAmort 409 258 30 Dragon Naturally Speaking 10/01/06 191 191 3 MOAmmt 80 63 Total Other Depreciation 90,326 - 90,326 70,097 15,526 Total ACRS and Other Depreciation 90,326 90,326 70,097 15,526 P07000 PC & Network Associates, Inc 09/09/2010 7:21 PM 25-1847000 Federal Asset Report FYE: 12/31/2008 Form 1120S, Page 1 Date Bus Sec Basis Asset Description In Service Cost %0 1796onus for Depr PerConv Meth Prior Current Grand Totals 99,878 96,561 70,908 20,310 Less: Dispositions 0 0 0 0 Less: Start-up/Org Expense 0 0 0 0 Net Grand Totals 99,878 96,561 70,908 20,310 P07000 PC & Network Associates, Inc 09/09/2010 7:21 PM 25-1847000 Bonus Depreciation Report FYE: 12/31/2008 Date In Tax Bus Tax Sec Current Prior Tax-Basis Asset Property Description Service Cost Pct 179 Exp Bonus Bonus for Depr Activity, Form 1120S.Page 1 36 Buffalo 320 GB NAS 1/10/08 159 0 80 0 79 37 Buffalo 500 GB NAS 1/13/08 259 0 130 0 129 38 Compaq ML 370 3/13/08 500 0 250 0 250 39 Unisys e-action Ent Server 3/25/08 750 0 375 0 375 40 Unisys E-action ent server 4/15/08 850 0 425 0 425 41 Maxtor 750 GB USB Crive 4/15/08 117 0 59 0 58 42 Portable AC Unit 6/28/08 260 0 130 0 130 43 Portable AC Unit 7/06/08 148 0 74 0 74 44 Seagate 1TB USB Drive 12/10/08 140 0 70 0 70 45 Unisys Dell 7/30/08 1,200 0 600 0 600 46 HPD530 7/30/08 553 0 277 0 276 47 Hp D515(3) 7/30/08 1,694 0 847 0 847 Form 1120S, Page 1 6,630 0 3,317 0 3,313 Grand Total 6,630 0 3,317 0 3,313 P07000 PC & Network Associates, Inc 09/09/2010 7:21 PM 25-1847000 AMT Asset Report FYE: 12/31/2008 Form 1120S, Page 1 Date Bus Sec Basis Asset Description In Service Cost %0 179Bonus for Depr PerConv Meth Prior Current 5-year GDS Property: 36 Buffalo 320 GB NAS 1/10/08 159 X 79 5 HY 20ODB 0 95 37 Buffalo 500 GB NAS 1/13/08 259 X 129 5 HY 20ODB 0 155 38 Compaq ML 370 3/13/08 500 - X 250 5 HY 20ODB 0 300 39 Unisys e-action Ent Server 3/25/08 750 X 375 5 HY 20ODB 0 450 40 Unisys E-action ent server 4/15/08 850 X 425 5 HY 20ODB 0 510 41 Maxtor 750 GB USB Crive 4/15/08 117 X 58 5 HY 20ODB 0 70 44 Seagate ITB USB Drive 12/10/08 140 X 70 5 HY 20ODB 0 84 45 Unisys Dell 7/30/08 1,200 X 600 5 HY 20ODB 0 720 46 HPD530 7/30/08 553 X 276 5 HY 20ODB 0 332 47 Hp D515 (3) 7/30/08 1,694 X 847 5 HY 20ODB 0 1,016 6,222 3,109 0 3,732 7-year GDS Property: 42 Portable AC Unit 6/28/08 260 X 130 7 HY 20ODB 0 149 43 Portable AC Unit 7/06/08 148 X 74 7 HY 20ODB 0 85 408 204 0 234 Prior AC S: 6 2004 misc equip 1/01/05 1,109 1,109 5 HY ISODB 647 185 8 EXB 200 Tape Drive 2/24/05 259 259 5 HY 15ODB 151 43 9 WDC 250 Hard Drive 3/23/05 291 291 5 HY 15ODB 170 48 11 IBM X235 Server 4/14/05 1,075 1,075 5 HY 150DB 627 179 27 Brother HL 2040 6/13/06 85 85 5 HY 150DB 34 16 28 ulare 8125 6/27/06 403 403 7 HY 150DB 120 61 31 HP 2605DN printer 1/30/07 424 424 5 MQ 15ODB 111 94 32 HP 2605DN printer 1/30/07 509 509 5 MQ 150DB 134 112 33 HP LaserJet 2300 2/13/07 160 160 5 MQ 15ODB 42 35 34 2 APC replacment batteries 11/07/07 333 333 5 MQ 150DB 12 96 35 Various Hardware 12/31/07 664 664 5 MQ150DB 25 192 5,312 5,312 2,073 1,061 Other Depreciation: 1 Acer Combo Drive 12/29/03 1,921 1,921 5 M020ODB 1,783 138 2 HP Notebook NX7 12/29/03 3,755 3,755 5 M020ODB 3,485 270 3 Proliant Tower 12/29/03 5,173 5,173 5 M020ODB 4,801 372 4 Various Hardware 12/29/03 2,802 2,802 5 M020ODB 2,600 202 5 Prior Assets 12/31/04 27,690 27,690 5 MO 150DB 27,690 0 7 Shredder 2/21/05 349 349 5 MO 150DB 207 66 10 Compaq Server 4/19/05 435 435 5 MO 150DB 254 78 12 17"Encvision Monitor 5/19/05 191 191 5 MO 150DB 112 32 13 Hard Drives 7/21/05 300 300 5 MO 150DB 175 48 14 Samsung Telephone 7/25/05 650 650 7 MOISODB 281 81 15 Sharp Copier/Fax 8/15/05 355 355 5 MO I5ODB 208 57 16 LEAPSERV 12/23/05 400 400 5 MO 15ODB 233 56 17 Office Chairs 3/21/05 1,547 1,547 5 MO 15ODB 878 297 18 Antique Chairs 4/18/05 509 509 5 MO 150DB 287 95 19 Rack Shelving 5/10/05 384 384 5 MO 150DB 216 72 20 6 Desks-Sam's 10/29/05 1,193 1,193 5 MO 150DB 671 184 21 Flash Drives 2/14/06 201 201 5 MO 15ODB 99 33 22 Quotewers 5/04/06 792 792 3 MO 15ODB 528 198 23 Linksys Router 5/09/06 143 143 5 MO 150DB 63 24 Total Other Depreciation 48,790 48,790 44,571 2,303 Total ACRS and Other Depreciation 48,790 48,790 44,571 2,303 P07000 PC & Network Associates, Inc 09/09/2010 7:21 PM 25-1847000 AMT Asset Report FYE: 12/31/2008 Form 1120S, Page 1 Date Bus Sec Basis Asset Description In Service Cost % 179Bonus for Depr PerConv Meth Prior Current Grand Totals 60,732 57,415 46,644 7,330 Less:Dispositions 0 0 0 0 Net Grand Totals 60,732 57,415 46,644 7,330 P07000 PC & Network Associates, Inc 09/09/2010 7:21 PM 25-1847000 Depreciation Adjustment Report FYE: 12/31/2008 All Business Activities AMT Adjustments/ Form Unit Asset Description Tax AMT Preferences MACRS Adiustments: Page 1 1 21 Flash Drives 38 33 5 Page 1 1 23 Linksys Router 28 24 4 Page 1 1 27 Brother HL 2040 17 16 1 Page 1 1 28 ulare 8125 71 61 10 Page 1 1 31 HP 2605DN printer 111 94 17 Page 1 1 32 HP 2605DN printer 132 112 20 Page 1 1 33 HP LaserJet 2300 42 35 7 Page 1 1 34 2 APC replacment batteries 126 96 30 Page 1 1 35 Various Hardware 253 192 61 Page 1 1 36 Buffalo 320 GB NAS 95 95 0 Page 1 1 37 Buffalo 500 GB NAS 155 155 0 Page 1 1 38 Compaq ML 370 300 300 0 Page 1 1 .39 Unisys e-action Ent Server 450 450 0 Page 1 1 40 Unisys E-action ent server 510 510 0 Page 1 1 41 Maxtor 750 GB USB Crive 70 70 0 Page 1 1 42 Portable AC Unit 149 149 0 Page 1 1 43 Portable AC Unit 85 85 0 Page 1 1 44 Seagate 1TB USB Drive 84 84 0 Page 1 1 45 Unisys Dell 720 720 0 Page 1 1 46 HPD530 332 332 0 Page 1 1 47 Hp D515 (3) 1,016 1,016 0 4,784 4,629 155 P07000 PC & Network Associates, Inc 09/09/2010 7:21 PM 25-1847000 Future Depreciation Report FYE: 12/31/09 FYE: 12/31/2008 Form 1120S, Page 1 Date In Asset Description Service Cost Tax AMT Prior MACRS: 21 Flash Drives 2/14/06 201 23 33 23 Linksys Router 5/09/06 143 16 24 27 Brother HL 2040 6/13/06 85 9 14 28 ulare 8125 6/27/06 403 50 49 31 HP 2605DN printer 1/30/07 424 66 70 32 HP 2605DN printer 1/30/07 509 80 84 33 HP LaserJet 2300 2/13/07 160 25 27 34 2 APC replacment batteries 11/07/07 333 76 68 35 Various Hardware 12/31/07 664 151 134 36 Buffalo 320 GB NAS 1/10/08 159 26 26 37 Buffalo 500 GB NAS 1/13/08 259 42 42 38 Compaq ML 370 3/13/08 500 80 80 39 Unisys e-action Ent Server 3/25/08 750 120 120 40 Unisys E-action ent server 4/15/08 850 136 136 41 Maxtor 750 GB USB Crive 4/15/08 117 19 19 42 Portable AC Unit 6/28/08 260 31 31 43 Portable AC Unit 7/06/08 148 18 18 44 Seagate 1TB USB Drive 12/10/08 140 22 22 45 Unisys Dell 7/30/08 1,200 192 192 46 HPD530 7/30/08 553 88 88 47 Hp D515(3) 7/30/08 1,694 271 271 9,552 1,541 1,548 Other Depreciation: 1 Acer Combo Drive 12/29/03 1,921 0 0 2 HP Notebook NX7 12/29/03 3,755 0 0 3 Proliant Tower 12/29/03 5,173 0 0 4 Various Hardware 12/29/03 2,802 0 0 5 Prior Assets 12/31/04 27,690 0 0 6 2004 misc equip 1/01/05 1,109 160 185 7 Shredder 2/21/05 349 46 65 8 EXB 200 Tape Drive 2/24/05 259 34 43 9 WDC 250 Hard Drive 3/23/05 291 38 49 10 Compaq Server 4/19/05 435 54 77 11 IBM X235 Server 4/14/05 1,075 138 179 12 17" Encvision Monitor 5119105 191 23 33 13 Hard Drives 7/21/05 300 33 49 14 Samsung Telephone 7/25/05 350 31 80 15 Sharp Copier/Fax 8/15/05 355 38 57 16 LEAPSERV 12/23/05 400 34 55 17 Office Chairs 3/21/05 1,547 212 298 18 Antique Chairs 4/18/05 509 68 95 19 Rack Shelving 5/10105 384 51 72 20 6 Desks-Sam's 10/29/05 1,193 121 185 22 Quotewers 5/04/06 792 88 66 24 Kaseya Software License 5/16/06 20,389 444 2,129 25 MS Action Pack 5/31/06 299 33 31 26 ConnectWise Softwrare 6/11/06 17,793 2,471 1,853 29 AVG Anti Virus 6/27/06 774 107 97 30 Dragon Naturally Speaking 10/01/06 191 48 36 - Total Other Depreciation 90,326 4,272 5,734 Total ACRS and Other Depreciation 90,326 4,272 5,734 Grand Totals 99,878 5,813 7,282 P07000 091092010 721 PM Retained Earnings Reconciliation Worksheet Porn, 1120S 2008 For calendar year 2008 or tax year beginning ending Name Employer Identification Number PC & NETWORK ASSOCIATES INC 25-1847000 Schedule L-Retained Earnings Retained Earnings-Unappmpriated 0 Accumulated Adjustments Account —371, 893 Other Adjustments Account 0 Undistributed Previously Taxed Income 0 . Schedule L,Lima 24-Retained Earnings -371,8 9 3 Schedule M-2 -Retained Earnings pc umutaVed Other Undistrib ted Veined EBmin s Total A tustmants Adjustments Previ usly axed U app 0 rtatedl� Retained ccount Account 4nodme Tim,ng br erences Earnings B"yr Sal -420, 680 0 0 0 -420, 680 Ordinary Inc(Loss) 48, 773 48, 773 Other Additions 26 26 Other Reductions 12 12 Distribution End Yr Bat -371, 893 0 0 0 -371, 893 P07000 09/0912010 7:21 PM Form 1120S Schedule K-1 Summary Worksheet 1 2008 Name Employer Identification Number PC & NETWORK ASSOCIATES INC 25-1847000 Shareholder Name SSNIEIN Column RICHARD POWELL ............ Column B ............ Column C ............ Column D Schedule K Column A Column B Column C Column D SCH K TOTAL Items 1 Ordinary income 48, 773 48, 773 2 Net rental RE inc 3c Net other rental inc 4 Interest income 26 26 5a Ordinary dividends 5b Qualfed dividends 6 Royalties 7 Net ST capital gain 8a Net LT capital gain 8b Collectibles 28%gain 8c Unrecap Sec 1250 9 Net Sec 1231 gain 10 Other Income(loss) 11 Sec 179 deduction 12a Contributions 12b Invest interest exp 12c Sec 59(eM2)exp 12d Other deductions 13a,c Low-inc house 4215 13b dLow-inc house other 13c Qualif rehab exp 13f Rental RE credits 13g Other rental credits 13h Fuel alwhol credit 131 Other credits 14b Gross inc all am 14d-f Total foreign inc 14g-kTotal foreign dads 141 Total foreign taxes 14m Reduct in taxes 15a Depr adjustment 155 155 15b Adjusted gain (loss) 15C Depletion 15d Inc-0oMgastgwth 15e Ded-oftastaeoth 15f Other AMT items 16a Tax-exempt interest 16b Other tax-exempt 16c Nonded expense 12 12 16d Total property dst 16o Shr loan repmts 17a Investment income 26 26 17b Investment expense 18 Income(foss) 48, 799 P07000 49!0912010 721 PM F m, 1120S Two Year Comparison Worksheet Page 1 2007 8t 2008 Name Employer Identification Number PC & NETWORK ASSOCIATES INC 25-1847000 2007 2008 Differences Gross profit percentage 79.1923 75 .3964 —3. 7959 Gross receipts less returns and allowances 230 602 321,262 90�660 Cost of goods sold 47, 983 79, 042 31, 059 ...................................... Income Gross profit 182, 619 242 220 59 601 Net gain(loss)from Form 4797 ........................... Other income(loss) ........... ......................... Total income loss 18:21 .6-19— 242,220 59 601 Compensation of officers 37 787 37 787 salaries and wages less employment credits 77 734 36, 669 —41 065 Repairs and maintenance .,. .---- '— Bad debts ................ -- Rents ---- 8 820 —8 820 ....... �_- -- Taxesandlicenses 9, 123. 8 233 —89 Deductions Interest ...... _._ 41 689 41 001 —688 .......................... ....... . . Depreciation 9 993 20 310 10 31 Depletion ...................................... ..... ..... 8 880 Adverfising ............................................. 9 956 1 076 — Pension, profit-sharing, etc„ plans , Employee benefit programs ............._............... Otherdeducions 44 526 48 371 3, 845 ....................................... Total deductions ,..,.. 239, 628 193 447 —46 1 1 ordinary business income toss —57 009 48, 773 105 782 Excess net passive income or LIFO recapture tax --� --- Tax from Schedule D ----- - .................................... Total tax 0 ---_ 0 .............................................. Estimated tax and prior year overpayment credited __— Tax deposited with Form 7004 Tax and Credit for federal tax paid on fuels Payments Refund applied for on Form 4466 . Total payments and credits Tax due(overpayment) ......__............. 0 0 Estimated tax penalty from Form 2220 .................... Penalties and interest ,......._......................... Not tax due{overpayment) 0 0 0 Overpayment credited to next year's estimated tax ... Overpayment refunded P07000 09109/2010 7:21 PM Form 1120S Two Year Comparison Worksheet Page 2 2007 & 2008 Name Employer Identification Number PC & NETWORK ASSOCIATES INC 25-1847000 2007 2008 Differences Ordinary business income (loss) -5v' 009 48, 773 105, 782 Net rental real estate income(loss) ....................... Other net rental income (loss) ............................ Interest income 26 26 Income Dividend income ........................................ (Loss) Royalties ............................................... Net short-term capital gain (loss) ......................... Net long-term capital gain (loss) .......................... Net Section 1231 gain (loss) ............................. Other income loss Section 179 deduction Charitable contributions .................................. Deductions Investment interest expense ............................. Section 59(e)(2)expenditures ............................ Other deductions Low-income housing credit (Section 420)(5)) ............... Low-income housing credit(other) ........................ Qualified rehabilitation expenditures (rental real estate) Credits Other rental real estate credits ...............:............. Other rental credits ...................................... Alcohol and cellulosic biofuel fuels credit ................... Other credits Total foreign gross income ............................... Foreign Total foreign deductions ................................. Transactions Total foreign taxes ...................................... Reduction in taxes available for credit Post-1986 depreciation adjustment 167 155 —12 ....................... Adjusted gain or loss .................................... AMT Depletion (other than oil and gas) ......................... Items Oil, gas, and geothermal properties-gross income .......... Oil,gas,and geothermal properties-deductions ............. Other AMT items Tax-exempt interest income .............................. Items Other tax-exempt income ................................ Affecting Nondeductible expenses 23 12 —11 S/H Basis ................................. Properly distributions Repayment of loans from shareholders Investment income 26 26 ...................................... Other Investment expenses Information Dividend distributions paid from accumulated E&P Income loss if Schedule M-1 is required) —57, 009 48, 799 105, 808 P070M 09Wr2D10 7:21 PM I Form 1120S Two Year Comparison Worksheet Page 3 2007 & 2008 Name PC & NETWORK ASSOCIATES INC Employer Identification Number 25-1847000 2007 2008 Differences Beginning assets 93, 841 32 571 —61 270 Schedule Beginning liabilities and equity H ............................ 93 841 32 571 —61 270 Ending assets 32 571 18 010 —14 561 . .. . .. . . Ending liabilities and. .u... ... ..... ............ . ...eg i 32, 571 18 010 —14 561 Net income(loss)per books —57 035 48, 786 105 821 Taxable income not on books ............................ Schedule Book expenses not deducted 2 6 13 —13 M-1 ............................. Income on books not on return ........................... Rehm deductions not on books .......................... Income loss per return —57, 009 48 799 105 808 Balance at beginning of year —363 819 —420 680 —56 861 Schedule Ordinary income(loss)from page 1,line 21 .......... .... —57 009 48 773 105 782 . . M.2 Other additions A 26 261 ....................... ..................M Other reductions . ... ........... 23 12 —11 ....................... . . Distributions other than dividend distributions .............. Balance at end of year —420 851 —371 893 48 958 Balance at beginning of year ............................. Schedule Other additions ......................................... M•2 Other retludions OAA ........................................ Distributions other than dividend distributions Balance at and of year ................................... Schedule Balance at beginning of year ............................. M•2 Distributions other than dividend distributions PTI B .............. Balance at end of year Total income(loss)Items: Income(loss)per income statement ..................... Temporary difference .................................. Permanent difference Income(loss)per tax return ............................ Total expense/deduction items: Expense per Income statement ......................... Temporary difference Schedule .................................. M3 Permanent difference .................................. Deduction per tax return ............................... Other items with no differences: Income(loss)per Income statement .............. Income(loss)per tax return ....... ............................ Recendliation totals: Income(loss)per income statement ..................... Temporary difference ........................... . Permanent difference .... .. .................................. Income loss r tax return ' P07000 09/09/2010 7:21 PM Shareholder's Basis Worksheet Page 1 Fern, 1120S 2008 Schedule K-1 I For calendar year 2008 or tax year beginning ,ending Name PC & NETWORK ASSOCIATES, INC Taxpayer Identification Number 25-1847000 RICHARD POWELL Stock Basis 1. Beginning of year stock basis .. .......................................... ................................................. 0 2. Capital contributions ..................................................................................................... Additions: 3. Ordinary business income 48, 773 .................................................. 4. Net rental real estate income 5. Other net rental income 6. Interest, dividends and royalties ......................... __.__....,, 26 7. Net capital gains ......................................................:......................... 8. Net section 1231 gain ........................................................................... 9. Tax-exempt interest and other income o. Other income ................................................................................... 48, 799 11. Other increases 12. Subtotal (Add line 1 through line 11) ....................................................................................... 48, 799 Subtractions: 13. Distributions ............................................................................................................ 14. Total losses and deductions applied against stock basis (See Shareholders Basis Worksheet Page 2) 48, 799 15. Other decreases 16. Amount used to restore loan basis ........................................................................................ 17. End of year stock basis (Subtract the sum of lines 13 through 16 from line 12) 0 .................................................. Loan Basis 18. Beginning of year loan basis 0 .............................................................................................. 19. Loans to corporation ..................................................................................................... 20. Loan basis restored-amount used in prior years to offset losses ............................................................. 21. Other increases 22. Loan repayments 23. Total losses and deductions applied against loan basis (See Shareholders Basis Worksheet Page 2) . ............................. 24. Other decreases 25. End of year loan basis (Subtract the sum of lines 22 through 24 from the sum of lines 18 through 21) 0 ............................. 26. End of year stock and loan basis (Add line 17 and line 25) 0 Gain Recognized on Excess Distributions 27. Distributions ............................................................................................................ 28. Stock basis before distributions and loss items ............................................................................. 29. Gain recognized on excess distributions (Subtract line 28 from line 27) Gain Recognized on Repayment of Shareholder Loan 30. Loan basis at beginning of tax year ........................................................................................ 31. Basis restored-amount used in prior years to offset losses .................................................................. 32. Loan basis before ban repayment (Add line 30 and line 31) .................................................................. 33. Face amount of shareholder loan at beginning of tax year .................................................................... 34. Loan repayments to shareholder during tax year ............................................................................ 35. Nontaxable return of loan basis ((Line 32 divided by line 33)multiplied by line 34)) .............................................. 36. Gain recognized on repayment of shareholder loan (Subtract line 35 from line 34) Note to shareholder: This worksheet was prepared based on corporation records. Please consult with your tax advisor for adjustments. co co \\\ 3 . }� 2 m \ \ �/ m to k a \ . 2 k )] , - ■ � 0 2 2 - _ ; _ \ 0 k � � { k � 6 � \ k ! B ) / ° MIMI \ ` % , \ \ ( \ ® � � ` � iC (A » ° ! ` R § / ! § \ r { { ) } � k � . : ) / � � � � ® ` ~ Z' � a \ \ { - - � 2 / ) � } f ! £ r ) { ) ` ! t / ) « Z ; { \ $ ! ko / i ] ! ) ) « f ) ! y � . � ! ■ , _ ! { ) / \ ! / ! { ! ! / } ) Uzzo 0 \ ƒ \ ) \ / \ ) { / � \ P07000 PC & Network Associates, Inc 9/9/2010 7:21 PM 25-1847000 Federal Statements FYE: 12/31/2008 Form 11205 Page 1 Line 1a - Gross Recei is Description Amount GROSS SALES $ 264,257 KIZ SALE 59, 333 LESS: SALES TAX _489 OTHER INCOME 1,263 TOTAL $____324, 364 Form 1120S Page 1 Line 1b - Returns and Allowances Description Amount $ 3, 102 TOTAL $____3, 102 Form 1120S. Pane 1 Line 12 - Taxes and Licenses Description Amount PAYROLL TAXES $ 8, 233 TOTAL $ 8,233 Form 1120S Page 1 Line 13 - Interest Description Amount LOAN INTEREST $ 11, 625 CREDIT CARD INTEREST/FINANCE 29, 376 TOTAL P07000 PC & Network Associates, Inc 9/9/2010 7:21 PM 25-1847000 Federal Statements FYE: 12/31/2008 Form 1120S. Page 2 Schedule K Line 4 Interest Income Description Amount INTEREST INCOME $ 26 TOTAL $ 26 P07000 PC $ Network Associates, Inc 25-1847000 Federal Statements 9/9/2010 7:21 PM FYE: 12/31/2008 Form 1120S Pa e 3 Schedule K Line 16c - Nondeductible Expenses Description Amount PAGE I MEALS/ENTERTAINMENT $ 12 TOTAL $ 12 Form 1120S Page 3 Schedule K Line 17a - Investment Income Description Amount INTEREST INCOME $ 26 TOTAL $ 26 F25-1847000 Network Associates, Inc 9!9!2010 7:21 PM Federal Statements 8 Form 11205 Page 4 Schedule L L ine 3 Inventories scription Beginning End of Year of Year $ 200 $ 200 $ 200 $ 200 Form 1120S. P4,.&—h L Line 17 - Mortgages. Notes Bonds Pav in Less Than One Yr Beginning End Description of Year of Year CREDIT. CARDS - PCNAI & RWP $ 175, 666 $ 256, 664 LINE OF CREDIT 50,$69 45, 645 TOTAL $ 226,535 $ 202, 309 Form 1120S Pane 4 Schedule L.gLine 19 Loan from Shareholders Description $o Year g End o f of Year LOAN FROM RWP $ 59, 996 $ TOTAL $ 59, 996 $ 0 Form 1120S. P4 Sch L Line 20 - Mortgages Notes Bonds Pay in Qne Year or More Beginning End Description of Year of Year SBA LOANS $ 248, 630 $ 127,517 TOTAL $ 148, 630 $ 127, 517 Form 11205 Page 4 Schedule L Line 23 Additional Paid4n Capital Beginning End Description of Year of Year $ 9,006 $ 50, 923 TOTAL $ 9, 006 $ 50, 923 P070M 09tt5/n20705:56 PM Form 7004 Application for Automatic Extension of Time To File Certain Business Income Tax, Information, and Other Returns OMB No,1545-0233 (Rev,Derembar 2008} Department of the Treasury ► File a separate application for each return. into=!Revenue Service ► See separate Instructions. Name Ider40ying number Type or PC 6 Network Associates, Inc Print 25-1847000 File by the due Number,street,and roam or suite no.(If P.O,box,see Instructions.) date for the return for which 1166 Young Road an extension is requested. See City,town,state,and ZIP code(If a foreign aooress,enter city,province m state,and country(follow the eountrys practice for entering instruaiwts, t:ostal code)). Punxsutawney PA 15767 Note. See instructions before completing this form. Part 1 Automatic 5-Month Extension Complete if Filing Form 1065, 1041, or 8804 1a Enter the form code for the return that this agioliCation is tot see below , Application Form Application Form Is For: Code Is For; Code Form 1065 09 Form 1041 estate 04 Form 8804 31 Form 1041 1 Wst 05 Part II Automatic 6-Month Extension Complete if Filing Other Forms b Enter the form code for the return that this avoticatiorn is for see below ..... ..... Application Form Application form Is For: Code Is For: Code Form 706-GS(D) 01 Form 1120-PC 21 Fort 706-GS 02 Form 1120-POL 22 Form 1041-N 06 Form 7120-REIT 23 Form 1041-OFT 07 Form 1120-RIC 24 Form 1042 08 Form 1120-S 25 Form 1065E K 1 Form 20 26 Form 1066 1 Fortn 520- 27 Form 1120 NOOF L111111111 Le,am 1 Fenn 28 Form 1120-C 34 Form 8613 29 Form 1120-F 15 Form 8725 30 Form 1120-FSC 16 Farm 8831 32 Form 1120+1 17 Form 8876 33 Form 1120-L 18 Form 8924 35 Form 1120•ND 19 Form 8928 36 Form 1120-ND section 4951 taxes 20 2 if the organization Is a foreign corporation that does not have an office or place of business in the United States, check hem ► .................................................................................................................... 3 If the organization is a corporation and is the common parent of a group that intends to file a consolidated return, check here If checked,attach a schedule,listing the name,address,and Employer identification Number(EIN)for each member covered by this application. I Part III All Filers Must Complete This Part 4 If the organization is a corporation or partnership that qualifies under Regulations section 1.6081-5,check here ► Sa The application is for calendar year 20 .... ,or tax year beginning ............... .and ending ................ to Short tax year. If this tax year is less than 12 months,check the reason: 11 Initial return Final return Change in accounting period Consolidated return to be filed 6 Tentative total tax 6 0 ............................................................................................ 7 Total payments and credits(see instructions) ........................ ............. ......,.....,......,. 7 0 8 Balance due.Subtract line 7 from line 6. Generally,you must deposit this amount using the Electronic Federal Tax Payment System(EFTPS),a Federal Tax Deposit(FTD)Coupon,or Electronic Funds Withdrawal E see instructions for exceptions) 8 0 For Privacy Act and Paperwork Reduction Act Notice,see separate Instructions. Form 7004(Rev.12-2008) DAA P07000 09/09010 5:56 PM Form 1124S U.S. Income Tax Return for an S Corporation OMB hlo.1W-0130 ► Do not file this form unless the corporation has filed or is 20U9 Department of the Treasury attaching Form 2553 to eleM to be an S corporation. L 9 Internal Revenue Service ► Sea, rate instructions. For calendar year 2009 or tax year boom ,ending A S election effective date Name D Employer identification number 10/12/99 IRS PC & Network Associates Inc 25-1847000 B Business activity code label. Number,street,and room or suite no.If a P.O.box,see instructions. E Date incorporated number(sea insbudi ns) Other- 541519 wise, 1166 Young Road 10/12/1999 P rint or C Check if Sch.M3 type. City or town,stale,and 21P code F Total assets(sae instructions) aaa�a ❑ Punxsutawney PA 15767 g 19,325 G is the corporation electing to be an S corporation beginning with this tax year? ❑ Yes 0 No If"Yes;'attach Farm 2553 if not already filed H Check if. (1) 8 Final return (2) 11 Amended change (33) F] Address change (4) Amended return (5) S election termination or revocation i Enter the number of shareholders who were shareholders during any part of the tax year ► 1 Caution. Include only trade or business income and expenses on lines la throucih 21. See the instructions for more information. to Gross receipts or sales 1 216 038 1 b Less returns and allowances 2421 c Bal 1 1c 215,796 2 Cost of goods sold(Schedule A,line 8) ........... ........................................................ 2 28,385 O 3 Gross profit.Subtract line 2 from line 1c 3 187,411 C 4 Net gain(loss)from Form 4797, Part II, line 17(attach Form 4797) 4 ....................................... 5 Other income (loss) (see instructions—attach statement) 5 6 Total Income floss). Add lines 3 through 5. ........ .......— ► 6 187,411 7 Compensation of officers .........................................._....................................... 7 37,787 8 Salaries and wages(less employment credits) ........................_...................................... 8 23,400 9 Repairs and maintenance ..........................................._..................................... 9 110 10 Bad debts .... ............. _.............................................................. 10 11 Rents ................._..........................,........,............,,......,........................ 11 12 Taxes and licenses .................._.__......................_....,_............................. 12 6,339 2 13 Interest ......_......_... ... .... NT4. .... .... .. .. 13 24,746 14 Depredation not chimed on hedule or el 2 14 6,603 15 Depletion (Do not deduct oil t n . ..... �..... ..................................... a 16 Advertising 16 p 17 Pension, profit-sharing, etc., plans 17 0 18 Employee benefit programs 18 .................... .......... w 19 Other deductions (attach statement) .................................See.. Stmt 1 19 40,253 20 Total deductions. Add lines 7 through 19..........................._......__......................... ► 20 139,238 21 Ordinary business income(loss). Subtract line 20 from line 8................................................. 21 48,173 22a Excess net passive income or LIFO recapture tax(see instructions) to Tax from Schedule D(Form 1120S) 22b ........................................... c Add lens 22a and 22b(see instructions for addifiona3 ties) ........... ............ ..... ...................... 22c 23a 2009 estimated tax payments and 2008 overpayment credited to 2009 23a b Tax deposited with Form 7004 23b ............................................ IL c Credit for federal tax paid on fuels(attach Form 4136) 23c ........................... C d Add lines 23a through 23c 23d N 24 Estimated tax penalty(see instructions). Check if Form 2220 is attached ► 24 K ............................... 25 Amount owed. If line 23d is smaller then 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 ar cunt overpaid ........................ 26 27 Enter amount from line 26 Credited to 2010 estimated tax► Refunded ► 27 Under penalties of perjury,I declare that I have examined this return,including accompanying schedules and statements, May be IRS discuss this realm wM the prepare and to the best of my knowledge and belief,it is true,corect,and complete.Declaration of preparer(other than taxpayer) Sign is based on all infon ation of which preparer has any knowledge, sl—below less kscn&b l X Y. No Here C President Signature or officer Richard Powell Date Tine Preparers Date Check If sslf- Preparers SSN or PTIN Paid sgnature Monique M. Ericson 09/09/10 employed © P00230493 Preparer's Firm's name for Ericson Accounting Services EIN 13-4215201 Use Only yours if self-employed), IF 205 Hemlock Rd Phone no. address,and ZIP code New Cumberland, PA 17070-2826 717-514-0149 For privacy Act and Paperwork Reduction Act Notice,sea separate instructions. Form 11200 gaos) DAA P07000 09/09/2010 5:56 PM Fom,1126S(tan) PC 6 Network Associates, Inc 25-1847600 Page 2 Schedule A Cost of Goods Sold see instructions I Inventory at beginning of year................................................................................. 1 200 2 Purchases 2 30,265 ..................................................._................................._.......... 3 Cost of labor................................................................................................ 3 4 Additional Section 263A costs{attach statememt) ..........._................................................... d 5 Other costs(attach statement) .....................................................__....................... 5 6 Total. Add tines 1 through 5 ....................................................................._........... 6 30,465 7 Inventory at end of year ................._.........._..............._........... 7 2,080 6 Cost of goods sold. Subtract line 7 from line 6.Enter hem and on page 1,line 2 ... .,._.. ,, 8 28,385 9a Check all methods used for valuing dosing inventory: (1) © Cost as described in Regulations section 1,4713 (ii) 8 Lower of cost or market as described in Regulations section 1.471-4 (iii) Other(Specify,method used and attach explanation.) ► ....._..............:.......................................................... b Check if them was a writedown of subnormal goods as described in Regulations section 1.471-2(c) ► c Check 9 the LIFO inventory method was adopted this tax year far any goods(H checked,attach Form 970) ,,,,,,,,,,,,,,,,,,,,,,,, ,,,,,,,,,,,, ► d If the LIFO inventory method was used for this tax year,enter percentage(or amounts)of dosing inventory computed under LIFO 9d ............................... ... .. ............................................ e If property is produced or acquired for resale,do the rules of section 263A apply to the corporation? ..__............... Yes IX No f Was them any change in determining quantities,cost,or valuations between opening and dosing inventory? ... .... ..... ...... Yes X No if'Yes,"attach explanation. Schedule B Other Information See instructions Yes No I Check accounting method: a Cash le Accrual c Lj Other(specify) ► ........._........................... 2 See the instructions and enter the: a Business activity ► ..., 4 9U b Product or service ► ,._cotnputer.. b,.IT sere...,._ 3 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 Wes,"attach a statement showing: (a)name and employer Identification number(EIN),(b) percentage owned,and(c)if lo0^/o owned,was a OSub election made? X ................................. 4 Has this corporation filed,or is it required to file,a return under section 6111 to provide information on any reportable transaction? ...,............_....................._.........._........................................._..............._... X 5 Check t box if the on F11ye t tm P t i ............. ► ❑ If check:,Check this the he cor corporation my awe to 6 F e for Pu O8e Odg nt Instruments. 6 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 ......................................................................................... ► $ .-1.-1.....I.—...... 7 Enter the accumulated earnings and profits of the corporation at the end of the tax year. $ 8 Are the corpombon's total receipts(see instructions)for the tax year and its total assets at the end of the tax year less than$250,0007 if'Yes.*the corporation is mot required to complain Schedules L and M-1. . .. .... .... .. ... .. X (Schedule K Shareholders' Pro Rata Share Items Total amount I Ordinary business intone(toss)(page 1,line 21) ..... . ..... t 48,173 2 ,Not rental real estate income (loss)(attach Form 8825) __ . ................................ .... 2 — 3a Other gross rental income(loss) ............. 3a b Expenses from other rental acthrtties(attach statement) ................ 3tr c Other net rental income(loss).Subtract tine 3b from line 3a.. .... .. ............... .................. .. 3c m 4 interest Income 4 $ o .................._................................_................................. d 5 DMdentls: a Ordinary dividentls ....................................................... Sa Eo b Qualified dividends .................._..................... 56 6 Royalties ......................_.................................................................... 6 7 Net short-term capital gain(loss)(attach Schedule D(Form 1120S)) ........................................ 7 ea Not long-term capital gain(loss)(attach Schedule D(Form 1120S)) ..................._................... 8a b Collectibles(280!)gain(loss) ............................................ 8b c Unrecaptured section 1250 gain(attach statement) 8. 9 Net section 1231 gain(IM)(attach Form 4797) .......................................................... 9 40 Other income loss see instmetlons Type► 10 Foram 1120S(zoos) DAA P070DO 09/0942010 5:56 PM Fonn ims 20o9 PC 6 Network Associates Inc 25-1847000 Page 3 Shareholders'Pro Rata Share hems continued Total amount 11 Section 179 deduction(attach Form 4562) .... .... ...... ... .. 11 ................................... 12a 12a Contributions ..............__......._................................__......._...._......... to Investment interest expense ...__,, ....,_. 1213 ................ Section 59(e)(2)expenditures (1)Type► ..............................................P)Amount ► 12c(2) of Other deductions see instructions . Type► 12d t3a law-income housing credit(section 420)(5)} ........................................................... 13a b low-income housing credit(other) .................................................................... 13b c Qualified rehabilitation expenditures (rental real estate) (attach Form 3468) , 13c d Other rental real estate credits(see instructions) .... Type► ..................... .................... 13d u a Other rental credits(see instructions) .............. Type► .............._.........__............. 13e f Alcohol and oefiulosic Nofuel fuels credit(attach Form 6478) 13f ............................................. Other credits see instructions ............... Type► 13 14a Name of country or U.S.possession ► b Gross income from ail sources 14b ....................................................................... c Gross income sourced at shareholder level ............................................................ 14c Foreign gross income sourced at corporate level d Passive category ................................................................ 14d ................... eGeneral category ................................................................................... 14e f Other attach statement 14f Deductions allocated and apportioned at shareholder level _ g Interest expense ........................................... ........... 1 c h Other 14h m .............................................................................................. 'm Deductions allocated and apportioned at corporate level to foreign source income tro. 1 Passive category 14i 7 General category ................................................................................... 14 k Other(attach statement) ................................................:............................ 14k Other information I Total foreign taxes( o P 141 m Reduction in taxes avai lots fo it(a t _ ,.. 14m n Other forei n tax infonna tt t .. . .... .. ........ 15a Post-1986 depredation adjustment ....._............................................................ 15a 26 y1!E to Adjusted gain or ...... ............... ... loss ..................................................... 1513 . . . Y]z c Depletion(other than oil and gas)..................................................................... 15c off d Oil,gas.and geothermal properties--gross income ........................... a Oil, eM1 ........... 15d g.r gas, geothermal propedes—deductions ............... 15e ....................................................... IF Other AMT Items attach statement ................................................ ....... ......... 15f �� 16a Tax-exempt interest income 16e Hh m b Other tax-exempt income ............................................................................ 166 Q u c Nondeductible expenses i6c 13 ............................................................................. 9y d Property distributions ...................................... 16d .......................................... r a Repayment of loans from shareholders ,,,, .... ........ ...... ..... 16e 0 17a Investment income 17a 8 ................................................................................. c n Is Investment expenses 1713 ............................................................................... 6.p c Dividend distributions paid from accumulated earnings and profits 17c E — d Other items and amounts attach statement See Statement 2 �D 18 Income/loss reconciliation. 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 141 ,, ,,,,,,, 18 48 181 Form 11205{2009) DAA P070M 09/09n010 5:56 PM Form 11205 2009 PC S Network Associates Inc 25-1847000 Page 4 Schedule L Balance Sheets per Books Beginning of tax year End of tax year Assets a b c it i cash 524 5,283 2a Trade rotes and accounts receivable b Less allowance for bad debts .............. 3 Inventories .............................. 4 U.S.government obligations ............... 5 Tax-exempt securities(see instructions) 6 Ober ansm assets(attadt statement) ............... 7 Loans to shareholders .................... 6 Mortgage and real estate bans ............ 9 01m iTC5trrents(ouch statement) - 10a Buildings and other depreciable assets 99,878 _ 101,157 _ b Less accumulated depreciation .. .._ 82,592 17,286 ( 89,195 11,962 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 Toalassets --........................ 1$ 010 19,325 Liabilities and Shareholders Equity 16 Accounts payable ........................ 17 Mortgages,notes,bonds payable in less than 1 year 20-2—,3-0-9— 174,615 i9 der amen sesoes track stwonent) Stmt 3 1,654 704 .............. 19 Loans from shareholders .................. 20 Mortgages,notes,bonds payable in 1 year or more 127,517 103,335 21 Other liabilities(attach Statement) _ zz Capital a p _ 7,500 23 Addition alpaidincapital Q 92 56 896 24 Retained earnings ........... .... —323 725 25 Adjustments to shareholders' - epuity(attach statement) ..................... 26 Less cost of treasury stock - ................ 27 Total liabilities and shareholders'equity 18 010 19,325 tSchedule M-1_ Reconciliation of Income (Loss) per Books With Income (Loss) per Return Note: Schedule M-3 rmeoull red instead of Schedule M•1 K total assets are$10 million or more—see instructions i Net income(loss)per books .,,,..._. .. 48,176 5 Income recorded on books this year not inputted 2 Income inducted on Schedule K,lines 1,2,3c,4, on Schedule K,lines 1 through 10(itemize): So,6,7,8a,%and 10,not recorded on books this a Tax-exempt interest $ yew(demlze): ........................... . ......................................... 3 Expenses recorded on books this year not 6 Deductions included on Schedule K. lines included on Schedule K,lines 1 through 12 1 through 12 and 141,not charged against and 141(itemize): book income this year(demize}, a Depredation $ ........................ a Depredation $ 8 b Traver nd ........................... entertarMoo $ ....................13 ......................................... 8 13 7 Add lines 5 and 6 8 4 Add tines 1 through 3 48,189 6 Income s Schedule K line i8.Line d le 65 r 7 48 181 S__c_heduie M-72 Analysis of Accumulated Adjustments Account, Other Adjustments Account, and Shareholders' Undistributed Taxable Income Previous) Taxed see instructions (a)Acamurated (b)other wilustmonts (c)Shareholders'undistributed adjustments atcoum account taxable Income previously taxed 1 Balance at beginning of tax year —371 893 2 Ordinary Income from page 1,line 21 48 173 3 Other additions Stint 4 8 — -_ .......................... - 4 Loss from page 1,line 21 _ 5 Other reductions Stmt 5 13 ..........Combine lines 1 through 5...... ......._.. —323,725 7 Distributions other than dividend distributions 8 Balance at end of tax year.Subtract line 7 from line 6 —323,7251 OAA Form 11205(2oog) P07000 0910912010 5:56 PM 671109 Final K-1 Amended K-1 OMa No,1545-0130 Schedule K-1 2UU9 Part III Shareholder's Share of Current Year Income, (Form 1120S) For calendar year 2009,ortax _ Deductions Credits and Other Items DeparUrent of the Treasory Year Deng 1 Ordinary thninc es income(loss) 13 Credits Internet Revenue Service ending 48,173 ' 2 Not rental real estate income(loss) Shareholder's Share of Income, Deductions, 3 oft,act rental,Kp a tloaa) Credits, etc. See back of fort and separate Instructions. Part i Information About the Corporation 4 Interest Income A Corporation's employer identification number 5a Ordinary dividends 25-1847000 8 Corporeton's name,address.city.staid,and ZIP code 56 OuakSed dividends 14 Foreign tmnaacdons PC & Network Associates, Inc 6 Royalties 1166 Young Road Punxsutawney PA 15767 7 Net stmt-term capital gain loss) C IRS Center where corporation filed return Be Net long-temr caplial gain(loss) Cincinnati OH 45999 FP—a—rtII1 htformation About the Shareholder aD cdnecgDles(28%)gain(losa) D Shareholder's Identifying number 8c Unrecephired secion 1250 gain E Shammoitlets name,address,city,state,and ZIP code 9 Net section 1231 gain(loss) Richard Powell c/o Michael Powell Executor 10 Other income(loss) 15 AtlemaOve minimum Vac(AMT)items 1166 Young Rd 26 Punxsutawney Pixsutawn tawney A 1 5 E N F Shareheidees pdrsamage of stack 100 .00(]000 % ownership for tax year # t M1 11 Section 779 deduction 16 Items affecting sharehtNtldr basis C* 13 12 Omer deductions 2. ,_ 0 it koi 17 Other information A 8 U* STMT See attached statement for additional information. For Paperwork Reduction Act Notice,sea instructions for Fonn 11205. Schedule K•1 (Form 11205)2009 DAA I P070M 09/092010 5:56 PM Form 4562 depreciation and Amortization OMB No.1545-0172 (Including information on Listed Property) 2aas Department of the Treasury letemal Revenue Service Attachment 67 (98) 110, Sao separate Instructions. 11.Attach to our tax return. uence No. Names)shaven on return identifying number PC S Network Associates Inc 25-1847000 Business or advIly to which this form relates Regular Depreciation LPart I_J 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 the instructions for a higher limit for certain businesses 1 250,000 ...................................... 2 Total cost of section 179 property placed in service(see Instructions) 2 .............................................. 3 Threshold cost of section 179 property before reduction in limitation(see instructions) 3 800 000 ................... Reduction In limitation.Subtract line 3 from line 2. If zero or less,enter-0- 4 .......—................................. 5 Dollar limitation for tar year.Subtract One 4 from lute t If zero or less enter-&.It married fd separately.see Instructions ............ 5 6 (a)Description of property (b)cost(misiness use orty). (0)Elected cost 7 Listed property. Enter the amount from tine 29 1 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 2008 Form 4562 10 11 Business income fimdation.Enter the smaller of business income(Trot 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 2010.Add lines 9 and 10 less line 12 . ► 13 Note: Do not use Part it or Part III below for listed property.instead,use Part V, I Part 11 1 Special Depreciation Allowance and Other Depreciation fDo not include listed prope See instr. 14 Special depredation albvrance for qualified property(other than listed property)placed in service during the tax year(see instructions 14 640 ..—.. .. 15 Property subject to section 168{ e n 15 16 Other depreciation(including A S . . ..... . ...,, 1 16 1 4,594 I Part 111 I MACRS De reci std r e s n Section A 17 MACRS deductions for assets placed in service in tax years beginning before 2009 ,,,....._,,,......_,..,,_..,..r�1 t7 1,273 18 If you are electing to group any assets placed In senl0e during the tax year Into one or none consist asset accounts check here► I I I Section 13--Assets Placed in Service During 2009 Tax Year Using the General Depreciation System (b) Month and year (o) Basis for depredation (d)Recovery (a) Otnuffivation of property placed In (ousinessfinves'Uram use (e) Convention (f) Method (g) Depredation deduction seMCO on In nctiors period 19a 3-year property b 5-year 481 5.0 HY 20ODB 96 c 7-year prog2rty, d 10-year property e 15 ear property If 20-year property ear property 25 S2 It Residential rental 27.5 MM S/L property 27.5 MM S/L i Nonresidential real 39 MM S/L property MM S/L Section Cr-Assets Placed In Service During 2009 Tax Year Using the Alternative Depreciation System 20a Class lilt I I SA. In 12-year 12 ties. I I SA. c 40-year 40 vrs MM S/L I Part IV I Summa 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(9),and fine 21.Enter here and on the appropriate lines of your return. Partnerships and S corporations—see instructions ........ 22 6,603 ... ........ 23 For assets she=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(2009) Drs There are no amounts for Page 2 P07000 PC & Network Associates, Inc 9/9/2010 5:56 PM 25-1847000 Federal Statements FYE: 12/31/2009 Statement 1 - Form 11205. Page 1. Line 19 - Other Deductions Description Amount Bank Charges $ 3,834 Dues and Subscriptions 1, 541 Legal & Professional 4, 642 Office Expense 3,300 Website Registration 315 Postage 299 Telephone 3,927 Web Hosting Fees 60 Trade Publications 19 Auto Mileage Reimb 3, 858 Parking 28 PSA Clearing 2,072 payroll processing fee 909 Insurance - Workers Comp 476 Insurance - Liab & Business 1, 01.6 Tolls 21.0 Employee Reimb 2, 607 Travel 147 Home Office Occupancy 8,897 Miscellaneous 784 Outside Services 1,298 50% of Meals & Entertainment 14 X90, Total CLIE N U ,/1 !"rW1 /' 1 P07000 PC & Network Associates, Inc 9/9/2010 5:56 PM 25-1847000 Federal Statements FYE: 12/31/2009 Statement 2 - Form 11205 Page 3 Schedule K Line 17d - Other Items and Amounts Description Amount Interest from U.S. Obligations $ $ CLIENT COPY 2 P07000 PC & Network Associates, Inc 9/9/2010 5:56 PM 25-1847000 Federal Statements FYE: 12/31/2009 Statement 3 Form 11205 Page 4 Schedule L Line 18 Other Current Liabilities Beginning End Description of Year of Year sales tax due $ 1, 654 $ 704 Total $ 1, 654 $ 744 Statement 4 Form 11205 Page 4 Schedule M-2. Line 3fal Other Additions Description Amount Interest Income $ 8 Total $ g Statement 5 Form 11205 Page 4 Schedule M-2. Line 5(a) Other Reductions Description Amount Disallowed Entertainment Exp $ 13 Total $ 13 CLIENT COPY 3-5 P07000 PC & Network Associates, Inc 9/9/2010 5:56 PM 25-1847000 Federal Statements FYE: 12/31/2009 Richard Powell Schedule K-1. Box 16, Code C - Nondeductible Expenses Shareholder Description Amount Page 1 Meals/Entertainment $ 13 Total $ 13 Schedule K-1. Box 17, Code U - Other Information Shareholder Description Amount Gain on Repayment Shr Loan 8, 919 Interest from U.S. Obligations 8 CLIENT COPY . . P07000 PC & Network Associates, Inc 09/09/2010 5:56 PM 25-1847000 Federal Asset Report FYE: 12/31/2009 Form 1120S, Page 1 Date Bus Sec Basis Asset Description In Service Cost % 179 Bonus for Depr PerConv Meth Prior Current 5-year GDS Pronerty: 34 APC Battery 6/11/09 128 X 64 5 BY 20ODB 0 77 36 DL 585 2/15/09 834 X 417 5 BY 20ODB 0 500 962 481 0 577 Prior MACRS: 37 2 APC replacement batteries 11/07/07 333 333 5 BY 20ODB 143 76 38 various hardware 12/31/07 664 664 5 BY 20ODB 286 151 39 Buffalo 320 GB NAS 1/10/08 159 X 79 5 BY 206DB 95 26 40 Buffalo 500 GB NAS 1/13/08 259 X 129 5 BY 20ODB 155 42 41 compaq ML 370 3/13/08 500 X 250 5 BY 20ODB 300 80 42 Unisys e-action Ent Server 3/25/08 750 X 375 5 BY 20ODB 450 120 43 Unisys E-action Ent Server 4/15/08 850 X 425 5 BY 20ODB 510 136 44 Maxtor 750 GB USB Drive 4/15/08 117 X 58 5 HY 20ODB 70 19 45 Seagate 1 TB USB Drive 12/10/08 140 X 70 5 BY 20ODB 84 22 46 Unisys Dell 7/30/08 1,200 X 600 5 BY 20ODB 720 192 47 HPD 530 7/30/08 553 X 276 5 BY 20ODB 332 88 48 HP D515(3) 7/30/08 1,694 X 847 5 BY 20ODB 1,016 271 49 Portable AC Unit 6/28/08 260 X 130 7 BY 20ODB 149 32 50 Portable Ac Unit 7/06/08 148 X 74 7 BY 20ODB 85 18 7,627 4,310 4,395 1,273 Other Depreciation: 1 HP Notebook NX7000 12/29/03 3,755 3,755 5 M020ODB 3,755 0 2 Proliant Tower ML350 12/29/03 5,173 5,173 5 M020ODB 5,173 0 3 Various Hardware 2000B 2,802 0 4 Acer Combo Drive CLIENT,:6? 92 0200DB 1,921 0 5 prior misc equip \ j M020ODB 918 19] 6 prior assets `/ �/ ,690 5 M020ODB 27,690 0 7 SHREDDER 2/21/05 349 349 5 M020ODB 261 75 8 exb220 tape drive 2/24/05 259 259 5 M020ODB 215 38 9 Office Chairs 3/21/05 1,547 1,547 7 M020ODB 1,064 149 10 WDC 250 Hard Drive 3/23/05 291 291 5 M020ODB 241 40 11 IBM X235 Server 4/17/05 1,075 1,075 5 M020ODB 889 140 12 6 Chairs 4/18/05 509 509 7 M020ODB 350 48 13 Compaq Server 4/19/05 435 435 5 M020ODB 360 56 14 Rack Shelving 5110105 384 384 7 M020ODB 264 36 15 17' envision Monitor 5/19/05 191 191 5 M020ODB 158 23 16 Hard Drives 7/21/05 300 300 5 M020ODB 248 33 17 Samsung Telephone 7/25/05 350 350 7 M020ODB 241 31 18 Sharp Copier/Fax 8/15/05 355 355 5 M020ODB 294 39 19 6 desks-Sam's 10/29/05 1,193 1,193 7 M020ODB 820 107 20 Leapsery 12/23/05 400 400 5 M020ODB 331 35 21 Flash Drives 2/14/06 201 201 5 M020ODB 143 28 22 Quotewerx 5/04/06 792 792 3 MOAmort 704 88 23 Linksys Router 5/09/06 143 143 5 M020ODB 102 18 24 Kaseys Software License 5/16/06 20,389 20,389 3 MOAmort 19,945 444 25 MS Action Pack 5/31/06 299 299 3 MO S/L 266 33 26 ConnectWise CRM Software System 6/11/06 17,793 17,793 3 MOAmort 15,322 2,471 27 Brother HL-2040 Printer 6/13/06 85 85 5 M020ODB 60 10 28 Cingular 8125 6/27/06 403 403 5 M020ODB 227 70 29 AVG Antivirus 6127/06 774 774 3 MOAmort 666 108 30 Dragon Naturally Speaking 10/01/06 191 191 3 MOAmort 144 47 31 HP 2605DN 1/30/07 424 424 5 M020ODB 221 81 32 HP 2605 DN printer 1/30/07 509 509 5 M020ODB 265 98 33 HP LaserJet 2300 2/13/07 160 160 5 M020ODB 83 31 35 MS Action Pack 7/22/09 317 X 158 3 MOAmort 0 185 Total Other Depreciation 92,568 92,409 86,143 4,753 Total ACRS and Other Depreciation 92,568 92,409 86,143 4,753 P07000 PC & Network Associates, Inc 09/09/2010 5:56 PM 25-1847000 Federal Asset Report FYE: 12/31/2009 Form 1120S, Page 1 Date Bus Sec Basis Asset Description In Service Cost % 179 Bonus for Depr PerConv Meth Prior Current Grand Totals 101,157 97,200 90,538 6,603 Less: Dispositions and Transfers 0 0 0 0 Less: Start-up/Org Expense 0 0 0 0 Net Grand Totals 101,157 97,200 90,538 6,603 CLIENT COPY P07000 PC & Network Associates, Inc 09/09/2010 5:56 PM 25-1847000 Bonus Depreciation Report FYE: 12/31/2009 Date In Tax Bus Tax Sec Current Prior Tax-Basis Asset Property Description Service Cost Pct 179 Exp Bonus Bonus for Dept Activity: Form 1120S.Psee 1 35 MS Action Pack 7/22/09 317 0 159 0 158 34 APC Battery 6/11/09 128 0 64 0 64 36 DL 585 2/15/09 834 0 417 0 417 39 Buffalo 320 GB NAS 1/10/08 159 0 0 80 79 40 Buffalo 500 GB NAS 1/13/08 259 0 0 130 129 41 compaq ML 370 3/13/08 500 0 0 250 250 42 Unisys a-action Ent Server 3/25/08 750 0 0 375 375 43 Unisys E-action Ent Server 4/15/08 850 0 0 425 425 44 Maxtor 750 GB USB Drive 4/15/08 117 0 0 59 58 45 Seagate 1 TB USB Drive 12/10/08 140 0 0 70 70 46 Unisys Dell 7/30/08 1,200 0 0 600 600 47 HPD 530 7/30/08 553 0 0 277 276 48 HP D515(3) 7/30/08 1,694 0 0 847 847 49 Portable AC Unit 6/28/08 260 0 0 130 130 50 Portable Ac Unit 7/06/08 148 0 0 74 74 Form 1120S,Page 1 7,909 0 640 3,317 3,952 Grand Total 7,909 0 640 3,317 3,952 CLIENT COPY P07000 PC & Network Associates, Inc 09/09/2010 5:56 PM 25-1847000 AMT Asset Report FYE: 12/31/2009 Form 1120S, Page 1 Date Bus Sec Basis Asset Description In Service Cost % 179Bonus for Depr PerConv Meth Prior Current 5-year GDS Property: 34 APC Battery 6/11/09 128 X 64 5 BY 20ODB 0 77 36 DL 585 2/15/09 834 X 417 5 BY 20ODB 0 500 962 481 0 577 Prior MACRS: 37 2 APC replacement batteries 11/07/07 333 333 5 BY 150DB 108 68 38 various hardware 12/31/07 664 664 5 BY 150DB 217 134 39 Buffalo 320 GB NAS 1/10/08 159 X 79 5 BY 20ODB 95 26 40 Buffalo 500 GB NAS 1/13/08 259 X 129 5 BY 20ODB 155 42 41 compaq ML 370 3/13/08 500 X 250 5 BY 20ODB 300 80 42 Unisys e-action Ent Server 3/25/08 750 X 375 5 BY 20ODB 450 120 43 Unisys E-action Ent Server 4/15/08 850 X 425 5 BY 20ODB 510 136 44 Maxtor 750 GB USB Drive 4/15/08 117 X 58 5 BY 20ODB 70 19 45 Seagate 1 TB USB Drive 12/10108 140 X 70 5 BY 20ODB 84 22 46 Unisys Dell - 7/30/08 1,200 X 600 5 BY 20ODB 720 192 47 HPD 530 7/30/08 553 X 276 5 BY 20ODB 332 88 48 HP D515 (3) 7/30/08 1,694 X 847 5 BY 20ODB 1,016 271 49 Portable AC Unit 6/28/08 260 X 130 7 BY 20ODB 149 31 50 Portable Ac Unit 7/06/08 148 X 74 7 HY 20ODB 85 18 7,627 4,310 4,291 1,247 Other Depreciation: 1 HP Notebook NX7000 12/29/03 3,755 3,755 5 MO 15ODB 3,755 0 2 Proliant Tower ML350 12/29/03 5,173 5,173 5 MO 15ODB 5,173 0 3 Various Hardware 1 150DB 2,802 0 4 Various Combo Drive //'''�' I 1,9 92 0150DB 1,921 0 5 2004 Combo equip \ * L N 1 1 \ O MO 150DB 832 277 6 prior assets `/ 7,6 \/ ,690 5 MO 150DB 27,690 0 7 SHREDDER 2/21/05 349 349 5 MO 150DB 261 75 8 exb220 tape drive 2/24/05 259 259 5 MO 150DB 194 56 9 Office Chairs 3/21/05 1,547 1,547 7 MO 150DB 884 204 10 WDC 250 Hard Drive 3/23/05 291 291 5 M0150DB 222 55 11 IBM X235 Server 4/17/05 1,075 1,075 5 MO 150DB 806 202 12 6 Chairs - 4/18/05 509 509 7 MO 150DB 287 67 13 Compaq Server 4/19/05 435 435 5 MO 15ODB 326 82 14 Rack Shelving 5/10/05 384 384 7 MO 150DB 219 50 15 IT' envision Monitor 5/19/05 191 191 5 M015ODB 144 33 16 Hard Drives 7/21/05 300 300 5 MO 15ODB 225 47 17 Samsung Telephone 7/25/05 350 350 7 MO 15ODB 200 42 18 Sharp Copier/Fax 8/15/05 355 355 5 MO 150DB 266 56 19 6 desks-Sam's 10/29/05 1,193 1,193 7 MO 150DB 681 134 20 Leapsery 12/23/05 400 400 5 MO I50DB 300 50 21 Flash Drives 2/14/06 201 201 5 MO 150DB 117 40 23 Linksys Router 5/09/06 143 143 5 MO I50DB 84 25 25 MS Action Pack 5/31/06 299 299 3 MO S/L 266 33 27 Brother HL-2040 Printer 6/13/06 85 85 5 MO 150DB 50 14 28 Cingular 8125 6/27/06 403 403 5 MO 150DB 181 89 31 HP 2605DN 1/30/07 424 424 5 MO 150DB 172 82 32 HP 2605 DN printer 1/30/07 509 509 5 MO 150DB 206 98 33 HP Lasedet 2300 2/13/07 160 160 5 MO 150DB 65 31 Total Other Depreciation. 52,312 52,312 48,329 1,842 Total ACRS and Other Depreciation 52,312 52,312 48,329 1,842 Grand Totals 60,901 57,103 52,620 3,666 Less: Dispositions and Transfers 0 0 0 0 Net Grand Totals 60,901 57,103 52,620 3,666 P07000 PC & Network Associates, Inc 09/09/2010 5:56 PM 25-1847000 Depreciation Adjustment Report FYE: 12/31/2009 All Business Activities AMT Adjustments/ Form Unit Asset Description Tax AMT Preferences MACRS Adjustments: Page 1 1 - 34 APC Battery 77 77 0 Page 1 1 36 DL 585 500 500 0 Page 1 1 37 2 APC replacement batteries 76 68 8 Page 1 1 38 various hardware 151 134 17 Page 1 1 39 Buffalo 320 GB NAS 26 26 0 Page 1 1 40 Buffalo 500 GB NAS 42 42 0 Page 1 1 41 compaq ML 370 80 80 0 Page 1 1 42 Unisys e-action Ent Server 120 120 0 Page 1 1 43 Unisys E-action Ent Server 136 136 0 Page 1 1 44 Maxtor 750 GB USB Drive 19 19 0 Page 1 1. 45 Seagate 1 TB USB Drive 22 22 0 Page 1 1 46 Unisys Dell 192 192 0 Page 1 1 47 HPD 530 88 88 0 Page 1 1 48 HP D515 (3) 271 271 0 Page 1 1 49 Portable AC Unit 32 31 1 Page 1 1 50 Portable Ac Unit 18 18 0 1,850 1,824 26 CLIENT COPY P07000 PC & Network Associates, Inc 09/09/2010 5:56 PM 25-1847000 Future Depreciation Report FYE: 12/31/10 FYE: 12/31/2009 Form 1120S, Page 1 Date In Asset Description Service Cost Tax AMT Prior MACRS: 34 APC Battery 6/11/09 128 20 20 36 DL 585 2/15/09 834 134 134 37 2 APC replacement batteries 11/07/07 333 46 63 38 various hardware 12/31/07 664 91 125 39 Buffalo 320 GB NAS 1/10/08 159 15 15 40 Buffalo 500 GB NAS 1/13/08 259 25 25 41 compaq ML 370 3/13/08 500 48 48 42 Unisys e-action Ent Server 3/25/08 750 72 72 43 Unisys E-action Ent Server 4/15/08 850 82 82 44 Maxtor 750 GB USB Drive 4/15/08 117 11 11 45 Seagate 1 TB USB Drive 12/10/08 140 14 14 46 Unisys Dell 7/30/08 1,200 115 115 47 HPD 530 7/30/08 553 53 53 48 HP D515 (3) 7/30/08 1,694 163 163 49 Portable AC Unit 6/28108 260 22 23 50 Portable Ac Unit 7/06/08 148 13 13 - 8,589 924 976 Other Denreciation: 1 HP Notebook NX7000 12/29/03 3,755 0 0 2 Proliant Tower ML350 12/29/03 5,173 0 0 3 - Various Hardware 12/29/03 2,802 0 0 4 Acer Combo Drive 12/29/03 1,921 0 0 5 2004 misc equip O1/0 1,10 0 6 prior assets /0 27 0 7 SHREDDER CLIE 0 49 O] Y13 8 ez6220 tape drive 24 9 9 9 Office Chairs 21/ 1, 14 204 10 WDC 250 Hard Drive 3/23/05 291 10 14 11 IBM X235 Server 4/17/05 1,075 46 67 12 6 Chairs 4/18/05 509 47 66 13 Compaq Server 4/19/05 435 19 27 - 14 Rack Shelving 5110105 384 36 49 15 17" envision Monitor 5/19/05 191 10 14 16 Hard Drives 7/21/05 300 19 28 17 Samsung Telephone 7/25/05 350 30 42 18 Sharp Copier/Fax 8/15/05 355 22 33 19 6 desks-Sam's 10/29/05 1,193 94 133 20 Leapsery 12/23/05 400 34 50 21 Flash Drives 2/14/06 201 28 41 22 Quotewerx 5/04/06 792 0 0 23 Linksys Router 5/09/06 143 17 26 24 Kaseys Software License 5/16/06 20,389 0 0 25 MS Action Pack 5/31/06 299 0 0 26 ConnectWise CRM Software System 6/11/06 17,793 0 0 27 Brother HL-2040 Printer 6/13/06 85 11 15 28 Cingular 8125 6/27/06 403 70 89 29 AVG Antivirus 6/27/06 774 0 0 30 Dragon Naturally Speaking 10/01/06 191 0 0 31 HP 2605DN 1/30/07 424 59 81 32 HP 2605 DN printer 1/30/07 509 70 99 33 HP LaserJet 2300 2/13/07 160 22 31 35 MS Action Pack 7/22/09 317 53 0 Total Other Depreciation 92,568 864 1,131 Total ACRS and Other Depreciation 92,568 864 1,131 Grand Totals 101,157 1,788 2,107 P07000 09/0912010 5:56 PM Retained Earnings Reconciliation Worksheet Form 1120S 2009 For calendar year 2009 or tax year beginning ending Name Employer Identification Number PC & Network Associates Inc 25-1847000 Schedule L - Retained Earnings Retained Earnings-Unappropriated 0 Accumulated Adjustments Account —323,725 Other Adjustments Account 0 Undistributed Previously Taxed Income 0 Schedule L,Line 24-Retained Earnings —323,725 Schedule M-2 - Retained Earnings 1Ac umulated Other UndistfibYed fbtained Earnivs To=al justments Adaustments Previ us axed pappdq nate Retained ccount ccount Qncb"me Timing i erences Eamings Beg yr Bel —371,893 0 0 0 —371,893 Ordinary Inc(Loss) 48,173 48,173 Other Additions 8 8 Other Reductions 13 13 Distributions �� End Vr Bal —3 7 NET 0 !�� T 0 —323,725 ■�■ � ■Sri �r�'—Y� P07000 09/09/2010 5:56 PM Y Form 1120S Schedule K-1 Summary Worksheet 2009 Name Employer Identification Number PC & Network Associates Inc 25-1847000 Shareholder Name SSN/EIN Column A Richard Powell ............ Column B ............ Column C ............ Column D Schedule K Column A Column B Column C Column D .Sch K Total Items 1 Ordinary income 48,173 48,173 2 Net rental RE inc 3c Net other rental inc 4 Interest income 8 8 5a Ordinary dividends 5b Qualified dividends 6 Royalties 7 Net ST capital gain 8a Net LT capital gain 8b Collectibles 28% gain 8c Unrecap Sec 1250 9 Net Sec 1231 gain 10 Other income (loss) 11 Sec 179 deduction 12a Contributions ti 12b Invest interest exp �� ji l I I _I I F� Y 'N i ■ ■ ■ ■ v ■ ". s 12c Sec 59(e)12j exp �* � ■ � ■ s ■ �r r/ ■ ■ 12d Other deductions 13a,c Low-inc house 4215 13b,d Low-inc house other 13e Qualif rehab exp 13f Rental RE credits 13g Other rental credits 13h Fuel alwhol credit 13i Other credits 14b Gross inc all src 14d-f Total foreign inc 14g-k Total foreign dads 141 Total foreign taxes Urn Reduct in taxes 15a Depradjustment 26 26 15b Adjusted gain (loss) 15c Depletion 15d Inc-oil/gas/geoth 15e Ded-oil/gas/geoth 15f Other AMT items 16a Tax-exempt interest 16b Other tax-exempt 16c Nonded expense 13 13 16d Total roperty dist the Shr loan repmts 17a Investment income 8 8 17b Investment expense 18 Income(loss) 48,181 48,181 P07000 09/092010 5:56 PM Form 1120S Two Year Comparison Worksheet Page 1 2008 & 2009 Name Employer Identification Number PC 6 Network Associates Inc 1 25-1847000 2008 2009 Differences Gross profit percentage 75.3964 86. 8464 11.4500 .................................. Gross receipts less return s and allowances 321,262 215,796 —105 466 ................ Cost of goods sold ___... 79,042 28,385 —50 657 Income Gross profit 242,220 187,411 —54,809 ............................................ Net gain(loss)from Form 4797 ........................... Other income(loss) ..................................... Total income loss 242,220 187,411 —54 809 Compensation of officers 37,787 37,787 ................................ Salaries and wages less employment credits 36,669 23,400 —13,269 Repairs and maintenance 110 110 ................................ Bad debts .............................................. Rents Taxes and licenses 8 233 6,339 —1,894 ..................................... Deductions Interest 37,973 24,746 —13,227 ................................................ Depreciation 20,310 6,603 —13 707 ........................................... Depletion .............................................. Advertising 1,076 —1 076 ............................................. Pension, profit-sharing, etc., plans ........................ Employee benefit programs .............................. Other deductions 48, 643 40,253 —8 390 ....................................... Total deductions 190,691 139,238 —51,453 ....................................... Ordinary business income loss 51,529 48,173 —3,356 Excess net passive income or LIFO recapture tax Tax from Schedule D Total Estimated tax and priGUEN. .. 0 O Tax deposited with Form 7004 ............................ Tax and Credit for federal tax paid on fuels ........................ Payments Refund applied for on Form 4466 ......................... Total payments and credits ............................. Tax due(overpayment) 0 0 0 ................................. Estimated tax penalty from Form 2220 .................... Penalties and interest ................................... Net tax due(overpayment) .................. ........... 0 0 0 Overpayment credited to next year's estimated tax Overpayment refunded P07000 09109/2010 5:56 PM Form 1120S Two Year Comparison Worksheet Page 2 2008& 2009'. Name Employer Identification Number PC & Network Associates Inc 25-1847000 2008 2009 Differences Ordinary business income (loss) 51,529 48,173 —3 356 Net rental real estate income(loss) Other net rental income(loss) ............................ Interest income 26 8 —18 ......................................... Income Dividend income ........................................ (Loss) Royalbes ............................................... Net short-tens capital gain (loss) ......................... Net long-tens capital gain (loss) .......................... Net Section 1231 gain(loss) ............................. Other income loss Section 179 deduction ................................... Charitable contributions .................................. Deductions Investment interest expense ............................. Section 59(e)(2)expenditures ............................ Other deductions Low-income housing credit(Section 420)(5)) ............... Low-income housing credit(other) ........................ Qualified rehabilitation expenditures (rental real estate) Credits Other rental real estate credits ............................ Other rental credits ...................................... Alcohol and cellulosic biofuel fuels credit ................... Other credits Total foreign gross income Foreign Total foreign deducbo Transactions Total foreign taxes . Reduction in taxes ava o LMIENT Name NW0111" Post-1986 depreciation adjustment 155 26 —129 Adjusted gain or loss .................................... AMT Depletion(other than oil and gas) ......................... Items Oil, gas, and geothermal properties-gross income .......... Oil,gas, and geothermal properties-deductions ............. Other AMT items Tax-exempt interest income .............................. Items Other taxexempt income ................................ Affecting Nondeductible expenses 12 13 1 S/H Basis ................................. Property distributions ......... .......................... Repayment of loans from sharehol. ders Investment income 26 8 —18 ...................................... Other Investment expenses .................................... Information Dividend distributions paid from accumulated E&P Income loss if Schedule M-1 is required) 51,555 48,181 1 —3 374 P070W 09MM10 5:56 PM Form 1120S Two Year Comparison Worksheet Page 3 2008 8t 2009 Name Employer Identification Number PC s Network Associates Inc 25-1847000 2008 2009 Differences Beginning assets ....................................... 32,570 18,010 —14,560 Schedule Beginning liabilities and equity 32,570 18,010 —14,560 L Ending assets .............. 18,010 19,325 1,315 ..liabilities and equity 18,010 19,325 1,315 Net income(loss)per looks 51,542 48,176 —3,366 Taxable income not on books ............................ Schedule Book expenses not deducted 13 13 ............................. M-1 Income on books not on return Return deductions not on books 8 8 .......................... Income loss per return 51,555 48,181 —3,374 Balance at beginning of year -420,851 —371 893 48,958 Schedule Ordinary income(loss)from page 1, line 21 51,529 48,173 —3,356 M_2 Other additions ......................................... 26 8 —18 AAA Other reductions 12 13 1 ........................................ Distributions other than dividend distributions .............. Balance at end of year .... —369 308 —323,725 45,583 Balance at beginning of year ............................. Schedule Other additions ......................................... M-2 Other reductions ........................................ OAA Distributions other than dividend distributions .............. Balance at end of year................................... Schedule Balance at beginning of year M-2 Distributions other t distri ti s PTI Balance at end of e Total Income(loss)ite Income(loss)per income statement ..................... Temporary difference .................................. Permanent difference .................................. Income(loss)per tax return ............................ Total expense/deduction items: Expense per income statement ......................... Temporary diference .................................. Schedule Permanent difference Ma .................................. Deduction per tax return ............................... Other Items with no differences: Income(loss)per income statement ..................... Income(loss)per tax return ............................ Reconciliation totals: Income(loss)per income statement ..................... Temporary difference .................................. Permanent difference .................................. Income loss r tax return P070M 09109r1010 5:56 PM Shareholder's Basis Worksheet Page 1 Form 1120S 2009 Schedule K-1 I For calendar year 2009 or tax year beginning ,ending Name PC & Network Associates, Inc Taxpayer Identification Number 25-1847000 Richard Powell Stock Basis 1. Beginning of year stock basis 0 ............................................................................................. 2. Capital contributions ..................................................................................................... Additions: 3. Ordinary business income 48,173 ........................................................................ 4. Net rental real estate income ..................................................................... 5. Other net rental income .......................................................................... 6. Interest,dividends and royalties ................................................................... 8 7. Net capital gains ................................................................................ 8. Net section 1231 gain ........................................................................... 9. Tax-exempt interest and other income ............................................................. 10. Other income 48,181 .. ........ .. ............................................................ 11. 0therincreases Increase PIC 6,073 12. Subtotal (Add line 1 through line 11) ....................................................................................... 54,254 Subtractions: , 13. Distributions ............................................................................................................ 14. Total losses and deductions applied against stock basis (See Shareholder's Basis Worksheet Page 2) ............................ 54,254 15. Other decreases 16. Amount used to restore ban basis ........................................................................................ 17. End of year stock basis (Subtract the sum of lines 13 through 16 from line 12) 0 ................................................. wL an asls COPY 18. Beginning of year loan Dasis ...C.� � � ■\ T ........... 19. Loans to corporation ..................................................................................................... 20. Loan basis restored-amount used in prior years to offset losses ............................................................. 21. Other increases 22. Loan repayments ....................................................................................................... 23. Total losses and deductions applied against loan basis (See Shareholder's Basis Worksheet Page 2) ...... 24. Other decreases 25. End of year loan basis (Subtract the sum of lines 22 through 24 from the sum of lines 18 through 21) 0 26. End of year stock and loan basis (Add line 17 and line 25) 0 Gain Recognized on Excess Distributions 27. Distributions ............................................................................................................ 28. Stack basis before distributions and loss items ............................................................................. 29. Gain recognized on excess distributions (Subtract line 28 from line 27) Gain Recognized on Repayment of Shareholder Loan 30. Loan basis at beginning of tax year ........................................................................................ 31. Basis restored-amount used in prior years to offset losses .................................................................. 32. Loan basis before ban repayment (Add line 30 and line 31) ................................................................. 33. Face amount of shareholder loan at beginning of tax year.................................................................... 34. Loan repayments to shareholder during tax year ............................................................................ 35. Nontaxable return of loan basis ((Line 32 divided by line 33)multiplied by line 34)) 36. Gain recognized on repayment of shareholder loan (Subtract line 35 from line 34) .......................................... Note to shareholder. This worksheet Was prepared based on corporation records.Please consult with your tax advisor for adjustments. M m m N a H N O n T U) `m p N N N n O 0 0 rn rnrn y O N N N K N J r O V B J d N O ;J O Q g 01 O O y a rn o .y m d o Lo m H m m a ld )d )d C d l0 3� d rn rn rn C N l0 m C E R a Y o w � o O (9 d N ` 40/ C Q N m .6 Q % +�+ O cn O (p t0 c o o, o 'o V d T m0 d O 0 O O 3 d C m m m $ TM M N O a o m m m R P U) M M fq 0 m N H C N J N v V Y S a M c c O m . a to y N N r r b n MM U gJ m mm a 0 N y 3 m FI o 0 0 o g ^ m a s 0 Za a a O dox- ca C o o X "t N N m o ° m 4 ac oaa o E y a s o L~E 3`m m o E Ti o Q E N o rn m o N LL m C P N L L O m t L m m m O O m m 0 0 > m m i� Eo y� L O F O E p $ O Z O to J Z O O m U U Z O Z 0 0 0 a a S O w a C) �' O LL S m Z Z ❑ H Z P07000 PC & Network Associates, Inc 9/9/2010 5:56 PM 25-1547000 Federal Statements FYE: 12/31/2009 Form 1120S. Pane 1. Line is - Gross Receipts Description Amount Gross Sales $ 214,750 Other income 1,288 Total $ 216, 038 Form 1120S. Page 1. Line 1b - Returns and Allowances Description Amount $ 242 Total $ 242 Form 1120S. Pane 1. Line 12 - Taxes and Licenses Description Amount payroll taxes $ 6,339 Total $ 6, 339 Form 1120S. Page 1. Line 13 - Interest Descriptior� ' ' r\ ' �iYnouSt Loan Interest $�i Credit Card Interest/Finance 18, 750 Total $ 24, 746 P07000 PC & Network Associates, Inc 9/9/2010 5:56 PM 25-1847000 Federal Statements FYE: 12/31/2009 Form 1120S. Page 2. Schedule K. Line 4 - Interest Income Description Amount interest income $ 8 Total $ 8 CLIENT COPY P07000 PC & Network Associates, Inc 9/9/2010 5:56 PM 25-1847000 Federal Statements FYE: 12/31/2009 Form 11205. Page 3. Schedule K. Line 16c - Nondeductible Expenses Description Amount Page 1 Meals/Entertainment $ 13 Total $ 13 Form 1120S. Page 3. Schedule K. Line 17a - Investment Income Description Amount Interest Income $ 8 Total $ 8 CLIENT COPY P07000 PC & Network Associates, Inc 9/9/2010 5:56 PM 25-1847000 Federal Statements FYE: 12/31/2009 Form 11205. Page 4. Schedule L. Line 3 - Inventories Beginning End Description of Year of Year Inventory $ 200 $ 2, 080 Total $ 200 $ 2, 080 Form 1120S. P4. Sch L. Line 17 - Mortaaaes. Notes Bonds Pay in Less Than One Yr Beginning End Description of Year of Year Credit Cards - PCNAI & RWP $ 156, 664 $ 137, 663 Line of Credit 45, 645 36, 952 Total $ 202,309 $ 174, 615 Form 1120S. Page 4. Schedule L. Line 19 - Loans from Shareholders Beginning End Description of Year of Year Loan from RWP $ $ Total $ 0 $ 0 1 1117777 K M11, Form 1120S.%4. L ti r.'20 1 Mg&es Ate AtesAud OTe _Y2ilr or More Beginning End Description of Year of Year SBA loans $ 127,517 $ 103, 335 Total $ 127,517 $ 103, 335 Form 1120S. Page 4. Schedule L. Line 23 - Additional Paid-In Capital Beginning End Description of Year of Year $ 50, 923 $ 56, 896 Total $ 50, 923 $ 56, 896 P07000 09/13/2011 2:00 PM Fo m 8879S IRS a-file Signature Authorization OMB No.1545.1863 for Form 1120S 2010 Department of the Treasury For calendar year 2010,or tax year beginning ,ending Internal Revenue Service ► See instructions.Do not send to the IRS.Kee for our records. Name of corporation Employer identification number PC 6 NETWORK ASSOCIATES INC 25-1847000 Part I Tax Return Information Whole dollars only) 1 Gross receipts or sales less returns and allowances(Form 1120S, line tc) ................................... 1 60, 664 2 Gross profit(Forth 1120S, line 3) .....................................................I..I............... 2 48,017 3 Ordinary business income(loss) (Form 1120S, line 21) ..............................I...........I......... 3 927 4 Net rental real estate income(loss)(Form 11205,Schedule K,line 2)........................................ 4 5 Income loss reconciliation Forth 11205, Schedule K, line 18 ............................................. 5 929 I Part 11 Declaration and Signature Authorization of Officer (Be sure to get a copy of the corporation's return) Under penalties of perjury, I declare that I am an officer of the above corporation and that I have examined a copy of the corporation's 2010 electronic income tax return and accompanying schedules and statements and to the best of my knowledge and belief,it is true, correct,and complete. I further declare that the amounts in Part I above are the amounts shown on the copy of the corporation's electronic income tax return. I consent to allow my electronic return originator(ERO), transmitter, or intermediate service provider to send the corporation's return to the IRS and to receive from the IRS(a) an acknowledgement of receipt or reason for rejection of the transmission, (b)the reason for any delay in processing the return or refund,and(c)the date of any refund.If applicable,I authorize the U.S.Treasury and its designated Financial Agent to initiate an electronic funds withdrawal (direct debit)entry to the financial institution account indicated in the tax preparation software for payment of the corporation's federal taxes owed on this return, and the financial institution to debit the entry to this account.To revoke a payment, I must contact the U.S.Treasury Financial Agent at 114M353-4537 no later than 2 business days prior to the payment(settlement)date. I also authorize the financial institutions involved in the processing of the electronic payment of taxes to receive confidential information necessary to answer inquiries and resolve issues related to the payment. I have selected a personal identification number(PIN)as my signature for the corporation's electronic income tax return and, if applicable,the corporation's consent to electronic funds withdrawal. Officer's PIN: check one box only ❑R I authorize ERICSON ACCOUNTING SERVICES, LLC to enter my PIN 47000 as my signature on thew oration's 2 e Lfa incom um. ao As an officer of the ce� s e ign ure on thra1 lelectrionicily fled income tax return. Officers signature ► Date► Title► PRESIDENT RICHARD POWELL t Part III Certification and Authentication ERO's EFINIPIN. Enter your six-digit EFIN followed by your five-digit self-selected PIN. 2 37 0 902 04 93 do not enter all zeros I certify that the above numeric entry is my PIN,which is my signature on the 2010 electronically fled income tax return for the corporation indicated above. I confrtn that I am submitting this return in accordance with the requirements of Pub.3112, IRS a-file Application and Participation, and Pub.4163, Modernized a-File (MeF) Information for Authorized IRS a-file Providers for Business Returns. ERO's signature ► MONIQUE M. ERICSON Data 01 09/13/11 ERO Must Retain This Form —See Instructions Do Not Submit This Form to the IRS Unless Requested To Do So For Paperwork Reduction Act Notice, see instructions. Farts 8879-S (2010) DAA P07WO 09/132011 2:00 PM 7��4 Application for Automatic Extension of Time To File Certain Forth Business Income Tax Information and Other Returns (Rev.December 2008) r ' OMB No.1545-0233 Department of the Treasury ► File a separate application for each return. Internal Revenue Service I ► See separate Instructions. Name Identifying number Type or PC S NETWORK ASSOCIATES, INC Print 125-1847000 File by the due Number,street and mom or suite no.(if P.O.box,see insbuctions.) date for the return for which 1166 YOUNG ROAD re extension is City,town,state,and ZIP code a e foreign address,enter d try(follow the countrys pmc5ce for entering requested. See ( 19 city,Province or state,and country instructions. postal code)). PUNXSUTAWNEY PA 15767 Note. See instructions before completing this form. Part I Automatic 5-Month Extension Complete if Filirlg Form 1065, 1041, or 8804 to Enter the form code for the return that this aDDfication is for see below Application Form Application Form Is For: Code Is For. Coda Forth 1065 09 Forth 1041 estate 04 Forth 8804 31 Forth 1041 trust 05 Part 11 Automatic 6-Month Extension Complete if Filing Other Forms b Enter the form code for the return that this application is for see below ....... ........ Application Forth Application Form Is For: Code Is For: Code Forth 706-GS(D) 01 Form 1120-PC 21 Forth 706-GS 02 Forth 1120-POL 22 Forth 1041-N 06 Forth 1120-REIT 23 Forth 1041-OFT 07 Form 1120-RIC 24 Form 1042 08 Form 1120-S 25 Form 1065-B 1 Forth 20- 26 Forth 1066 Forth 5 27 Form 1120 Forth 28 Forth 112DC 34 Form 8613 29 Form 1120-F 15 Forth 8725 30 Forth 1120-FSC 16 Form 8831 32 Forth 1120+1 17 Forth 8876 33 Form 1120-L 18 Forth 8924 35 Forth 1120-ND 19 Forth 8928 36 Form 112D-ND section 4951 taxes 20 2 If the organization is a foreign corporation that does not have an office or place of business in the United States, checkhere ............................................................................................................. ► ❑ 3 If the organization is a corporation and is the common parent of a group that intends to file a consolidated return, checkhere ............................................................................................................. ► El if checked, attach a schedule,listing the name,address,and Employer Identification Number(EIN)for each member covered by this application 'Part III All Filers Must Complete This Part 4 If the organization is a corporation or partnership that qualifies under Regulations section 1.6081-5, check here..................... ► Li 5a The application is for calendar year 20 ,or tax year beginning .. ,and ending b Short tax year. If this tax year is less than 12 months,check the reason: ❑ Initial return ❑ Final return ❑ Change in accounting period ❑ Consolidated return to be filed 6 Tentative total tax ..................................................................................... 6 0 7 Total payments and credits(see instructions) 8 Balance due. Subtract line 7 from line 6. Generally,you must deposit this amount using the Electronic Federal Tax Payment System(EFTPS), a Federal Tax Deposit(FTD) Coupon,or Electronic Funds Withdrawal E see instructions for exceptions) 8 0 For Privacy Act and Paperwork Reduction Act Notice,see separate Instructions. Form 7004(Rev.12-2008) DAA P07000 09/132011 2:00 PM Fonm 1 1 20S U.S. Income Tax Return for an S Corporation OMB No.1545-0130 ► Do not file this form unless the corporation has filed or is 2U1 O Department of the Treasury attaching Form 2553 to elect to be an S corporation. 1 Internal Revenue Service ► See separate instructions. For calendar year 2010 or tax year be i ranq ending A S election effective date Name D Employer identification number 10/12/99 PC 6 NETWORK ASSOCIATES INC 25-1847000 B Business activity code TYPE Number,street,and room or suite no.If a P.O.box,see instructions. E Date incorporated number(see instructions) OR 541519 PRINT 1166 YOUNG ROAD 10/12/1999 C Check if Sch.M-3 City or town,state,and ZIP code F Total assets(see instructions) attached ❑ PUNXSUTAWNEY PA 15767 $ 11,843 G Is the corporation electing to be an S corporation beginning with this tax year? ❑ Yes ❑X No If"Yes,"attach Form 2553 if not already fled H Check if:(1) Final return (2) ❑ Name change (3) ❑ Address change (4) B Amended return (5) ❑ S election termination or revocation I Enter the number of shareholders who were shareholders during any part of the tax year 11 2 Caution. Include onl trade or business income and ex enses on fines 1a throw h 21. See the instructions for more information. 1a Gross receipts or sale 60,664 b Less mluin and allowances c Bal► 1c 60,664 d 2 Cost of goods sold (Schedule A, line 8) ................................ 2 12,647 6 3 Gross profit. Subtract line 2 from line lc .................. 3 48 017 .......................... v 4 Net gain(loss)from Forth 4797, Part II,line 17(attach Forth 4797) ...................................... 4 c 5 Other income(loss)(see instructions—attach statement) ,,,,,_._. 5 6 Total income(loss). Add lines 3 through 5 ......................................................... ► 6 48 017 7 Compensation of officers ............................................................................ 7 13,480 0 8 Salaries and wages(less employment credits) ..............................--....................... 8 5,400 N 9 Repairs and maintenance .. 9 .......................................................................... E10 Bad debts .......................................................................................... 10 11 Rents 0 12 Taxes and licenses 12 2,908 ................................................................................. � 13 905 13 Interest ............... .... ........ .. .. 14 Depreciation not claimed Schad e A o el n t ( ach Fort 4562 14 581 15 Depletion (Do not deduct a ........................ ....... ................... 15 C 16 Advertising .............. .. 16 O 17 Pension, profit-sharing, etc., plans ........................................I........................... 17 v 18 Employee benefit programs ,,._ ........ 18 .............................................................. 19 Other deductions (attach statement) . . ........__..... . ..............SEE STMT 1 19 9,8f6— 020 Total deductions. Add lines 7 through 19 „_........................................................► 20 47 090 ................. 21 Ordinary business income (loss). Subtract line 20 from line 6 .......................................... 21 927 22a Excess net passive income or LIFO recapture tax(see instructions) ..............._. 22a b Tax from Schedule D(Forth 11205) 22b C c Add lines 22a and 22b(see instructions for additional taxes) ._.... . ............... .. .............. 22c E23a 2010 estimated tax payments and 2009 overpayment credited to 2010 23a R b Tax deposited with Form 7004 .......... 23b .................................. d c Credit for federal tax paid on fuels(attach Form 4136) 23c Cd Add lines 23a through 23c ......................................................................... 23d A 24 Estimated tax penalty(see instructions).Check if Form 2220 is attached ► ❑ 24 K 25 Amount owed. 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 from line 26 Credited to 2011 estimated tax► Refunded ► 27 Under penalties of perjury,I declare that I have examined this return,including accompanying schedules and state me y the IRS discuss this return with the preparer and to the best of my knowledge and belief,it is true,correct,and complete.Declaration of preparer(other than is in Sign is based on all infomration of which preparer has any knowledge. shown below see inshuc5ons 7 X yes No Here ' I , PRESIDENT Signature of officer RICHARD POWELL Dale Title Print/rype preparer's name Preparers signature Date Check if PTIN Paid MONIQUE M. ERICSON MONIQUE M. ERICSON 09/13/11 sett�mpbyed P00230493 Preparer Firms name ► ERICSON ACCOUNTING SERVICES LLC Firm's FIN► 13-4215201 Use Only Firm's address► 205 HEMLOCK RD NEW CUMBERLAND PA 17070-2826 Phone no.717-514-0149 For Paperwork Reduction Act Notice,see separate instructions. Form 11205(2010) DAA P07000 09/13/2011 2:00 PM Form 1120S(2010) PC & NETWORK ASSOCIATES INC 25-1847000 Page 2 Schedule A Cost of Goods Sold see instructions 1 Inventory at beginning of year ....,... 1 2 080 ...................................................... 2 Purchases ........................................................................................... 2 1-0,774 3 Cost of labor .......................................................................................... 4 Additional section 263A costs (attach statement) ........................ .. 4 5 Other costs(attach statement) ..............................................................STMT 2 5 1 873 6 Total. Add lines 1 through 5 ............................................................................ 6 14 727 7 Inventory at end of year ................................................................................ 7 2 ,080 8 Cost of goods sold. Subtract line 7 from line 6.Enter here and on page 1,line 2 ... ..... ...... 8 1 12,647 9a Check all methods used for valuing dosing inventory: (i) ® Cost as described in Regulations section 1.471-3 (ii) 8 4 Lower of cost or market as described in Regulations section 1.471 (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 dosing inventory computed under LIFO ......................................................................... 9d e If property is produced or acquired for resale,do the rules of section 263A apply to the corporation? ........................ Yes X No f Was there any change in determining quantities,cost,or valuations between opening and closing inventory? Yes X No If"Yes"attach explanation. Schedule B Other Information see instructions Y No 1 Check accounting method: a X Cesh b Accrual c Other(specify) ► ................................... 2 See the instructions and enter the: a Business activity ► ...COMPUTER $ IT SERVb Product or service ► ..COMPUTER S.. IT SERV j 3 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 and employer identification number(EIN),(b) percentage owned,and(c) if 1D0%owned,was a qualified subchapter S subsidiary election made? ...................................................................................I....................... 4 Has this corporation fled,or is it required to file, Form 8918, Material Advisor Disclosure Statement, to provide information on any reportabl n? .. .....jf�n .. .... ... ... ... ....a X 5 Check this box if the corpo on �ssu puDli m is vnth ginal is a cis u ► If checked,the corporation rri h' rrr ion etum for li final Issue iscount Instruments. 6 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 the basis of the asset(or the basis of any other property)in the hands of a C corporation and(b) has net unrealized built-in gain 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(see instructions) ..................................... ....................................... ► $........................ 7 Enter the accumulated earnings and profits of the corporation at the end of the tax year. $.............. ......... 8 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 ........................................ X 9 During the tax year,was a qualified subchapter S subsidiary election terminated or revoked? If"Yes'we instructions ............... X ISchedule K Shareholders' Pro Rata Share Items Total amount 1 Ordinary business income(loss)(page 1,line 21) ......... 1 927 2 Net rental real estate income(loss)(attach Form 8825) ................. ................... 2 38 Other gnus rental income(loss) 3a ..................................... b Expenses from other rental activities(attach statement) ..... .. c Other net rental income(low). Subtract line 3b from line 3a ,.„............................... 3c 4 Interest income ,,,,,,,.. 4 2 m 5 Dividends:a Ordinary dividends .................................................................. a E b Qualified dividends 5b ...................................... c6 Royalties ..............................................................I....................... 6 7 Net short-tern capital gain(loss)(attach Schedule D(Forth 11205)).................................. 7 8a Net long-term capital gain(loss)(attach Schedule D(Forth 11205)) .................................. 88 b Collectibles(28%)gain (loss) ............. Bb c Unrecaptured section 1250 gain (attach statement) ..................... Bc 9 Net section 1231 gain (loss)(attach Forth 4797) .................... 9 10 Other Income loss see instructions) . T ► 10 Form 11205(2010) DM P07000 09/13/2011 200 PM Form 11205 2010 PC & NETWORK ASSOCIATES INC 25-1847000 Page 3 Shareholders' Pro Rata Share ttemis continued Total amount 11 Section 179 deduction(attach Form 4562) 11 ....................................................... 12a Contributions 12a v' b Investment interest expense c Section 59(e)(2)expenditures (1)Type► .......................................... (2)Amount ► 12c(2) d Other deductions see instructions ............. Type► 12d 13a Low-income housing credit (section 426)(5)) ... . ............... 13a b Low-income housing credit(other) ................................ 13b +rj c Qualified rehabilitation expenditures (rental real estate) (attach Form 3468) 13c it Other rental real estate credits(see instructions) Type► ............. 13d U e Other rental credits(see instructions) . Type► ................ 13e f Alcohol and cellulosic biofuel fuels credit(attach Form 6478) .............. 13f Other credits see instructions ................. Type► 13 14a Name of country or U.S.possession No b Gross income from all sources .................................................................. 141b c Gross income sourced at shareholder level ....................................................... 14c Foreign gross income sourced at corporate level d Passive category .............................................................................. ce General category .............................................................................. 14e u f Other(attach statement) ....................................................................... w c Deductions allocated and apportioned at shareholder level Hg Interest expense .............................................................................. 14 a h Other ....................................................................................... .120 Deductions allocated and apportioned at corporate level to foreign source income U. i Passive category .............................................................................. 14i j General category .............................................................................. 14j k Other(attach statement) ....................................................................... Other information _ I Total foreign taxes( eck : ► aid ru 141 M Reduction in taxes ilabl f credi a 14m .. ........ n Other forei n tax info at ENT... ........... ..... .... ......... .. 158 Post-1986 depreciation adjustment 15a -25 .............................................................. Et-E b Adjusted gain or loss 15b .................................................................. m Emz c Depletion(other than oil and gas) 15c ,E� it Oil, gas,and geothermal properties-gross income ............. 15d 4Q a Oil, gas,and geothermal properties-deductions .._ .... 15e f Other AMT items attach statement 15f cd 116a Tax-exempt interest income 16a "c a b Other tax-exempt income ................................................................... 16b m c Nondeductible expenses ..................... ....... .... ...................................... 16c 1 518 Em d Distributions (attach statement if required) (see instructions) ................ 16d 5,284 :20 e Repayment of loans from shareholders .......................................................... 16e c 17a Investment income ...._.._._ 17a 2 .................................... d - b Investment expenses .................--................................................. 17b p€ c Dividend distributions paid from accumulated earnings and profits ............................ 17, it Other items and amounts attach statement I cp �'f 18 Incomelloss reconciliation. 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 141 ,,., 18 929 Form 1120S(2010) DAA P07000 09113r2011 2:00 PM Form 11206 2010 PC & NETWORK ASSOCIATES INC 25-1847000 Page 4 Schedule L Balance Sheets per Books Beginning o:tax year End of tax year Assets a b c d 1 Cash 5,283 ................... co .... 2a Trade notes and acunts receivable b Less allowance for bad debts .,..,..,..., 3 Inventories 2,080 2,080 ............................ 4 U.S.government obligations 5 Tax-exempt securities(see instructions) . 6 Omer wrens assets(albich statement) ............. 7 Loans to shareholders 8 Mortgage and real estate loans ,..,_,,, 9 Omer inles6nen6 labor statement) 10a Buildings and other depreciable assets 101,157 161,157 b Less aortmulated depredation ....., 90,813 10,340 91,394 9,763 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 ........................... 17 707 1-1,843 Liabilities and Shareholders' Equity 16 Accounts payable 17 Mortgages,notes,bonds payable in lass than 1 yea 174 ,615 176,322 18 Omer mnaa liabilities(attach statem l)STMT. 3. 704 19 Loans from shareholders 20 Mortgages,notes,bonds payable in t year ar more 103,335 21 Other liabilities(attach statement) 22 Capital stock ENI 7 500 23 Additional paid-in capital 5 89 56,896 24 Retained earnings ........... —331 216 25 Adjustments to shareholders equity(attach statement) ................... 26 Less cost of treasury stock ,.... 27 Total liabilities and shareholders ui 17 707 11,843 [Schedule Reconciliation of Income (Loss) per Books With Income (Loss) per Return Note: Schedule M-3 reouii red instead of Schedule M-1 if total assets are$10 million or more—see instructions 1 Net income(loss)per books —611 5 Income recorded on books this year not included 2 Irtcane included on Schedule K,lines 1,2,3c,4, on Schedule K lines 1 through 10(itemize): 5a,6,7,8a,9,and 10,rat recorded on books this a Tax-exempt Interest $ ,,,,,,,,,,,,,,,,,,,,, year(itemize): 3 Expenses recorded on books this year not 6 Deductions included on Schedule K,lines induced on Schedule K,lines 1 through 12 1 through 12 and 141,not charged against and 141(itemize): book income this year(itemize): a Depredation $ 22 a Depredation $ ......................... . b ei�ei ainmerd $....................... ............................. STMT. 4 ............. 1.r518. 1,5401 7 Add lines 5 and 6.., 4 Add lines 1 lhrou h 3 929 a Income loss Schedule K line 18.Lire b less line 7 929 Schedule M_-2 Analysis of Accumulated Adjustments Account, Other Adjustments Account, and Shareholders' Undistributed Taxable Income Previous) Taxed see instructions (a)Accumulated (b)Other adjustments (c) Sharehdders undistributed adjustments account account taxable income previously taxed 1 Balance at beginning of tax year —325,343 2 Ordinary income from page 1,line 21 927 - 3 Other additions STMT 5 2 ......................... 4 Loss from page 1,line 21 5 Other reductions STMT .6 1 518 6 Combine lines 1 through 5 —325 932 7 Distributions other than dividend distributions 5 284 8 Balance at end of tax r.Subtract line 71rom line —331 216 DAA Form 1120S(2o10) P07000 09/1312011 2.100 PM SECTION 1377 (A) (2) ELECTION MADE 671110 Final K-1 Amended K-1 OMB No.1545-0130 Schedule K-1 2010 Part III Shareholder's Share of Current Year Income, (Form 1120S) For calendar year 2010,or tax Deductions Credits and Other Items Department or the Treasury year beginning 1 Ordinary business income(loss) 13 Credits Internal Revenue Service 927 ending 2 Net rental real estate income(loss) Shareholder's Share of Income, Deductions, 3 Other net rental income(loss) Credits, etc. �See back of forth and separate Instructions Part I Information About the Corporation 4 Interest income 2 A Corporation's employer identification number 5a Ordinary dMdends 25-1847000 B Corporations name,address,city,slate,and ZIP coda 5b Qualified dividends 14 Foreign transactions PC 6 NETWORK ASSOCIATES, INC 6 Royalties 1166 YOUNG ROAD PUNXSUTAWNEY PA 15767 7 Net start-term capital gain Boss) C IRS Center where corporation filed return 8a Net longterm capital gain(loss) E-FILE FP—ayt-111 Information About the Shareholder en Collectibles(28%)gain(loss) D Shareholders identifying number 8c Unrecaptured sedan 1250 gain 184-46-5474 E Shareholders name,address,city,state,and ZIP code 9 Net section 1231 gain(ass) RICHARD POWELL 1166 YOUNG ROAD 10 Other Income Ooaa 15 Anemative minimum tax(AMT)its C LPJEN ' -25 PUNXSUTAWNEY F Sh areholders percentage of stock q5.205479 ownerslhhiip,for tax year IllllryJ: I f�� �byj�I�f�'K'y0 �1 III Rattached deduction 1G8 Items affecting shareholder 518 basis r[�IgllY�tf I�Iy!{V'�[yC EQM1�5RyY IIIRrII,']44Sy11 I�h�rg)gy?�NCf h1�1yY'lI��RR�RPII""��i�il��'yy9yRy111I�R!��'LL99�y.. Other D 5,006 r 0 0 m w 7 N K p 17 Other information A 2 U* S for additional information. For Paperwork Re duction Act Notice,see Instructions for Fortn 1120S. Schedule K-1 (Form 11205)2010 DAA P07000 0911312011 2:00 PM SECTION 1377 (A) (2) ELECTION MADE 671110 El Final K-1 Amended K-1 OMB No.1545-013D Schedule K-1 2010 part Ill Shareholders Share of Current Year Income, (Form 11205) For calendar year 2010,or tan Deductions Credits and Other Items Department of the Treasury year beginning 1 Ordinary business Income toss) 13 1 Credits Internal Revenue Service ending 2 Net rental real estate income(loss) Shareholder's Share of Income, Deductions, 3 Other net rental Income(loss) Credits, etc. 1 Soo back of form and separate instructions PaR I Information About the Corporation 4 Interest Income A Corporation's employer identification number Sa Ordinary dividends 25-1847000 B Corporation's name,address,city,state,and ZIP code 5b Qualified dividends 14 Foreign transactions PC S NETWORK ASSOCIATES, INC 6 Royalties 1166 YOUNG ROAD PUNXSUTAWNEY PA 15767 7 Net short-term capital gain toss) C IRS Center where corporation filed return 88 Net long-tens capital gain toss) E-FILE Bb Collectibles(28%)gain(loss) PaR 11 Information About the Shareholder D Shareholders identifying number Sc Unmcaptured section 1250 gain 27-6730044 E Shareholders name,address,city,state,and ZIP code 9 Not section 1231 gain(loss) ESTATE OF RICHARD W. POWELL 1166 YOUNG ROAD 10 Other Income(loss) 15 Alternative minimum tax(AMT)item PUNXSUTAWNEY CLIENT-COr F Shareholders percentage of stork ownershlpp�for lax year ���1 11,111 54.794521 % IKyy1 11 1IN 11 Otherd du deduction 1D6 Items a8eceng shert2 88r D85is e{��I�� fiY3 �Itr����yj" 12 Other deductions 2 c O m u, m K ni 17 Other information " See attached statement for additional information. For Paperwork Reduction Act Notice,see Instructions for Farm 1120S. Schedule K-1 (Forrn 1120S)2010 DM P07000 PC & Network Associates, Inc 9/13/2011 1:59 PM 25-1847000 Federal Statements FYE: 12/31/2010 Statement 1 - Form 1120S. Paae 1. Line 19 - Other Deductions Description Amount BANK CHARGES $ 1, 649 DUES AND SUBSCRIPTIONS 445 LEGAL & PROFESSIONAL 475 OFFICE EXPENSE 428 WEBSITE REGISTRATION 13 POSTAGE 124 TELEPHONE 2,391 AUTO MILEAGE REIMB 778 PAYROLL PROCESSING FEE 377 INSURANCE - LIAB & BUSINESS 447 TOLLS 70 EMPLOYEE REIMS 600 HOME OFFICE OCCUPANCY 1, 641 MISCELLANEOUS 273 COMPUTER SERVICES/REPAIRS 105 TOTAL $ 9, 816 CLIENT COPY 1 P07000 PC & Network Associates, Inc 9/1312011 1:59 PM 25-1847000 Federal Statements FYE: 12/31/2010 Statement 2 - Form 1120S. Page 2. Schedule A. Line 5 - Other Costs Description Amount OUTSIDE SERVICES $ 1, 873 TOTAL $ 1,873 CLIENT COPY 2 P07000 PC & Network Associates, Inc 9/13/2011 1:59 PM 25-1847000 Federal Statements FYE: 12/31/2010 Statement 3 - Form 11205 Page 4 Schedule L Line 18 - Other Current Liabilities Beginning End Description of Year of Year SALES TAX DUE $ 704 $ TOTAL $ 704 $ 0 Statement 4 - Form 1120S Page 4 Schedule M-1 Line 3 - Expenses on Books Not on Return Description Amount SHAREHOLDER HEALTH INSURANCE $ 1,518 TOTAL $ 1,-518 Statement 5 - Form 11205 Paae 4 Schedule M-2 Line 3(a) - Other Additions Description Amount INTEREST INCOME $ 2 TOTAL $ 2 Statement 6 - Form 1120S Paae 4 Schedule M-2 Line 5(a) - Other Reductions Description opy SHARE TOTALR HEALTH SU CE E$ 1, 518 3-6 P07000 PC & Network Associates, Inc 9/13/2011 1:59 PM 25-1847000 Federal Statements FYE: 12131/2010 Richard Powell 184-46-5474 Schedule K-1 Box 17. Code U - Other Information Shareholder Description Amount GAIN ON EXCESS DISTRIBUTION 4, 077 CLIENT COPY Year Ending: December 31, 2010 25-1847000 PC & Network Associates, Inc 1166 Young Road Punxsutawney, PA 15767 Election to Use the Specific Accounting Method for Allocating Income and Deductions The above named taxpayer elects under IRC Section 1377(a)(2) and Regulation 1.1377-1(b) to have the rules provided in IRC Section 1377(a)(1) applied as if the taxable year ending December 31, 2010 consisted of two separate tax years. The corporation and each affected shareholder consent to this election, which is made with respect to the termination of the entire shareholder's interest as follows: Manner of shareholder's termination: Death of 100% shareholder Date of termination: June 15, 2010 P07000 PC & Network Associates, Inc 09/13/2011 1:59 PM 25-1847000 Federal Asset Report FYE: 12/31/2010 Form 1120S, Page 1 Date Bus Sec Basis Asset Description In Service Cost % 179Bonus for Depr PerConv Meth Prior Current Prior MACRS: 34 APC Battery 6/11/09 128 X 64 5 HY 20ODB 77 10 Mass Out of Service: 6/14/10 36 DL 585 2/15/09 834 X 417 5 HY 20ODB 500 67 Mass Out of Service: 6/14/10 37 2 APC replacement batteries 11/07107 333 333 5 HY 20ODB 219 23 Maas Out of Service: 6/14/10 38 various hardware 12/31/07 664 664 5 HY 20oDB 437 46 Mass Out of Service: 6/14/10 39 Buffalo 320 GB NAS 1/10/08 159 X X 0 5 HY 20ODB 159 0 Out Of Service: 6/14/10 40 Buffalo 500 GB NAS 1/13/08 259 X X 0 5 HY 20ODB 259 0 Out Of Service: 6/14/10 41 compaq ML 370 3/13/08 500 X X 0 5 HY 20ODB 500 0 Out Of Service: 6/14/10 42 Unisys e-action Ent Server 3/25/08 750 X X 0 5 HY 20ODB 750 0 Out Of Service: 6114110 43 Unisys E-action Ent Server 4/15/08 850 X X 0 5 HY 20ODB 850 0 Out Of Service: 6/14/10 44 Maxtor 750 GB USB Drive 4/15/08 117 X X 0 5 HY 20ODB 117 0 Out Of Service: 6/14/10 45 Seagate 1 TB USB Drive 12/10/08 140 X X 0 5 HY 20ODB 140 0 Out Of Service: 6/14/10 46 Unisys Dell 7/30/08 1,200 X X 0 5 HY 20ODB 1,200 0 Out Of Service; 6/14/10 47 HPD 530 7130/08 553 X X 0 5 HY 20ODB 553 0 Out Of Service: 6/14/10 48 HP D515(3) 7/30/08 1,694 X X 0 5 HY 20ODB 1,694 0 Out Of Service: 6/14/10 49 Portable AC Unit 6/28/08 260 X X 0 7 HY 200D6 260 0 Out Of Sc 4- I ^ N'T `_,[ 7,863 146 50 Portable Ac Uni[ �/`y♦�� 7 6ryJ8C X X 7 >�TyyuB 148 0 Out Of Se e: 6/ 4 0 Other Depreciation: 1 HP Notebook NX7000 12/29/03 3,755 3,755 5 M020ODB 3,755 0 Mass Out of Service: 6/14/10 2 Proliant Tower ML350 12/29/03 5,173 5,173 5 M020ODB 5,173 0 Mass Out of Service: 6/14/10 3 Various Hardware 12129/03 2,802 2,802 5 M020ODB 2,802 0 Mass Out of Service: 6/14110 4 Acer Combo Drive 12/29/03 1,921 1,921 5 M020ODB 1,921 0 Mass Out of Service: 6/14110 5 2004 mist equip 1101105 1,109 1,109 5 M020ODB 1,109 0 Mass Out of Service: 6/14/10 6 prior assets I/01/04 27,690 27,690 5 M020ODB 27,690 0 Mass Out of Service: 6/14110 7 SHREDDER 2/21/05 349 349 5 M020ODB 336 13 Mass Out of Service: 6/14/10 8 exb220 tape drive 2/24/05 259 259 5 M020ODB 253 6 Mass Out of Service: 6/14/10 9 Office Chairs 3/21/05 1,547 1,547 7 M020ODB 1,213 62 Mass Out of Service: 6/14/10 10 WDC 250 Hard Drive 3/23/05 291 291 5 M020ODB 281 10 Mass Out of Service: 6/14/10 11 IBM X235 Server 4/17/05 1,075 1,075 5 M020ODB 1,029 46 Mass Out of Service: 6/14/10 12 6 Chairs 4/18/05 509 509 7 M020ODB 398 20 Mass Out of Service: 6/14/10 13 Compaq Server 4/19/05 435 435 5 M020ODB 416 19 Mass Out of Service: 6/14/10 14 Rack Shelving 5/10/05 384 384 7 M020ODB 300 '15 Mass Out of Service: 6/14/10 15 17'envision Monitor 5/19/05 191 191 5 M020ODB 181 10 Mass Out of Service: 6/14/10 16 Hard Drives 7/21/05 300 300 5 M020ODB 281 14 Mass Out of Service: 6/14/10 P07000 PC & Network Associates, Inc 09/13/2011 1:59 PM 25-1847000 Federal Asset Report FYE: 12/31/2010 Form 1120S, Page 1 Date Bus Sec Basis - Asset Description In Service Cost %0. 179Bonus for Depr PerConv Meth Prior Current 17 Samsung Telephone 7/25/05 350 350 7 M020ODB 272 13 Mass Out of Service: 6/14/10 18 Sharp Copier/Fax 8/15/05 355 355 5 M020ODB 333 16 Mass Out of Service: 6/14/10 - 19 6 desks-Sam's 10/29/05 1,193 1,193 7 M020ODB 927 39 Mass Out of Service: 6/14/10 20 Leapsery 12/23/05 400 400 5 M020ODB 366 14 Mass Out of Service: 6/14/10 21 Flash Drives 2/14106 201 201 5 M020ODB 171 11 Mass Out of Service: 6/14/10 22 Quotewerx 5/04/06 792 792 3 MOAmort 792 0 Mass Out of Service: 6/14/10 23 Linksys Router 5/09/06 143 143 5 M020ODB 120 7 Mass Out of Service: 6/14/10 24 Kaseys Software License 5/16/06 20,389 20,389 3 MOAmort 20,389 0 Mass Out of Service: 6/14/10 25 MS Action Pack 5/31/06 299 299 3 MO S/L 299 0 Mass Out of Service: 6/14/10 26 ConncctWise CRM Software System 6/11/06 17,793 17,793 3 MOAmort 17,793 0 Mass Out of Service: 6/14/10 27 Brother 111,2040 Printer 6/13/06 85 85 5 M020ODB 70 5 Mass Out of Service: 6/14/10 28 Cingular 8125 6/27/06 403 403 5 M020ODB 297 30 Mass Out of Service: 6/14/10 29 AVG Antivirus 6/27/06 774 774 3 MOAmort 774 0 Mass Out of Service: 6/14/10 30 Dragon Naturally Speaking 10/01/06 191 191 3 MOAmort 191 0 Mass Out of Service: 6/14/10 - 31 HP 2605DN 1/30/07 424 424 5 M020ODB 302 25 Mass Out of Service: 6/14/10 32 HP 2605 ON printer 1/30/07 509 509 5 M020ODB 363 29 Mass Out of Service: 6/14/10 33 HP Laserlet 2300 2 3 1 0 0 114 9 Mass Out of Set 4 o A ■ ■ I r'35 MS Action Pack 7 9 ' 7 I X 8 MO ort 185 22 Mass Ou[of Serv(c6 4 Total Other Depreciation 92,568 92,409 90,896 435 Total ACRS and Other Depreciation 92,568 92,409 90,896 435 Grand Totals 101,157 93,887 98,759 581 Less: Dispositions and Transfers 0 0 0 0 Less: Start-up/Org Expense 0 0 0 0 Net Grand Totals 101,157 93,887 98,759 581 P07000 PC & Network Associates, Inc 09/13/2011 1:59 PM 25-1847000 Bonus Depreciation Report FYE: 12/31/2010 Date In Tax Bus Tax Sec Current Prior Tax-Basis Asset Property Description service Cost Pct 179 Exp Bonus Bonus for Depr Activity: Form 11203-Page 1 35 MS Action Pack 722/09 317 0 0 159 158 34 APC Battery 6111/09 128 0 0 64 64 36 DL 585 2115109 834 0 0 417 417 39 Buffalo 320 GB NAS 1/10108 159 159 0 0 0 40 Buffalo 500 GB NAS 1/13/08 259, 259 0 0 0 41 Compaq ML 370 3/13/08 500 500 0 0 0 42 Unisys e-action Ent Server 325/08 750 750 0 0 0 43 Unisys E-action Ent Server 4/15108 850 850 0 0 0 44 Maxtor 750 GB USB Drive 4/15108 117 117 0 0 0 45 Seagate I TB USB Drive 12/10/08 140 140 0 0 0 46 Unisys Dell 7130/08 1,200 1,200 0 0 0 47 HPD 530 7/30/08 553 553 0 0 0 48 HP D515(3) 7/30/08 1,694 1,694 0 0 0 49 Portable AC Unit 6128/08 260 260 0 .0 0 50 Portable Ac Unit 7/06/08 148 148 0 0 0 Form 11205,Page 1 7,909 0 0 640 639 Grand Total 7,909 0 0 640 639 CLIENT* COPY P07000 PC & Network Associates, Inc 09/13/2011 1:59 PM 25-1847000 AMT Asset Report FYE: 12/31/2010 Form 1120S, Page 1 Date Bus Sec Basis Asset Description In Service Cost % 179Bonus for Depr PerConv Meth Prior Current Prior MACRS: 34 APC Battery 6/11/09 128 X 64 5 HY 20ODB 77 10 Mass Out of Service: 6/14/10 36 DL 585 2/15/09 834 X 417 5 HY 20ODB 500 67 Mass Out of Service: 6/14/10 - 37 2 APC replacement batteries 11/07/07 333 333 5 HY 15ODB 176 31 Mass Out of Service: 6/14/10 38 various hardware 12/31/07 664 664 5 HY 150DB 351 63 Mass Out of Service: 6/14/10 39 Buffalo 320 GB NAS 1/10/08 159 X X 0 5 HY 20ODB 159 0 Out Of Service: 6/14/10 40 Buffalo 500 GB NAS 1/13/08 259 X 129 5 HY 20ODB 259 0 Out Of Service: 6/14/10 41 compaq ML 370 3/13/08 500 X X 0 5 HY 20ODB 500 0 Out Of Service: 6/14/10 42 Unisys c-action Ent Server 3/25/08 750 X X 0 5 HY 20ODB 750 0 Out Of Service: 6/14/10 43 Unisys E-action Ent Server 4/15/08 850 X X 0 5 HY 20ODB 850 0 Out Of Service: 6114/10 44 Maxtor 750 GB USB Drive 4/15/08 117 X X 0 5 HY 20ODB 117 0 Out Of Service: 6/14/10 45 Seagate 1 TB USB Drive 12/10/08 140 X X 0 5 HY 20ODB 140 0 Out Of Service: 6/14/10 - 46 Unisys Dell 7/30/08 1,200 X X 0 5 HY 20ODB 1,200 0 Out Of Service: 6/14/10 47 HPD 530 7/30/08 553 X X 0 5 HY 20ODB 553 0 Out Of Service: 6/14110 48 HP D515(3) 7/30/08 1,694 X X 0 5 HY 20ODB 1,694 0 Out Of Service: 6/14/10 49 Portable AC Unit 6/28/08 260 X X 0 7 HY 20ODB 260 0 Out Of Se> 4L ■E � 50 Portable Ac Unit 7 6 8 1 8 X C-07 7 B 148 0 Out Of se e: 6/ 4 0 8, 7,734 171 Other Depreciation: I HP Notebook NX7000 12/29/03 3,755 3,755 5 MO 150DB 3,755 0 Mass Out of Service: 6/14/10 2 Proliant Tower ML350 12/29/03 5,173 5,173 5 MO 15ODB 5,173 0 Mass Out of Service: 04/10 3 Various Hardware 12/29/03 2,802 2,802_ 5 MO 15ODB 2,802 0 Mass Out of Service: 6/14/10 4 Acer Combo Drive 12/29/03 1,921 1,921 5 MO 150DB 1,921 0 Mass Out of Service: 6/14/10 5 2004 mist equip 1/01/05 1,109 1,109 5 MO 150DB 1,109 0 Mass Out of Service: 6/14/10 6 prior assets 1/01/04 27,690 27,690 5 MO I50DB 27,690 0 Mass Out of Service: 6/14/10 7 SHREDDER 2/21/05 349 349 5 MO I50DB 336 13 Mass Out of Service: 6/14/10 8 exb220 tape drive 2/24105 259 259 5 MO 150DB 250 9 Mass Out of Service: 6/14/10 9 Office Chairs 3/21/05 1,547 1,547 7 MO 150DB 1,088 85 Mass Out of Service: 6/14/10 10 WDC 250 Hard Drive 3/23/05 291 291 5 MO 15ODB 277 14 Mass Out of Service: 6/14/10 11 IBM X235 Server 4/17/05 1,075 1,075 5 MO 15ODB 1,008 67 Mass Out of Service: 6/14/10 12 6Chain 4/18/05 509 509 7 M0 15ODB 354 27 Mass Out of Service: 6/14/10 13 Compaq Server 4/19/05 435 435 5 MO 15ODB 408 27 Mass Out of Service: 6/14/10 14 Rack Shelving 5110105 384 384 7 MO 15ODB 269 20 Mass Out of Service: 6/14/10 15 IT'envision Monitor 5/19/05 191 191 5 MOI50DB 177 14 Mass Out of Service: 6/14/10 16 Hard Drives 7/21/05 300 300 5 MO 15ODB 272 20 Mass Out of Service: 6/14/10 P07000 PC & Network Associates, Inc 09/13/2011 1:59 PM 25-1847000 AMT Asset Report FYE: 12/31/2010 Form 1120S, Page 1 Date Bus Sec Basis Asset Description In Service Cost % 179Bonus for Depr PerConv Meth Prior Current 17 Samsung Telephone 7/25/05 350 350 7 MO 150DB 242 17 Mass Out of Service: 6/14/10 18 Sharp Copier/Fax 8/15/05 355 355 5 MO 150DB 322 24 Mass Out of Service: 6114/10 19 6 desks-Sam's 10/29/05 1,193 1,193 7 MO 150DB 815 55 Mass Out of Service: 6/14/10 20 Leapsery 12/23/05 400 400 5 MO150DB 350 21 Mass Out of Service: 6/14/10 21 Flash Drives 2/14/06 201 201 5 MO 150DB 157 17 Maas Out of Service: 6/14/10 23 Linksys Router 5/09/06 143 143 5 MO 15ODB 109 11 Mass Out of Service: 6114/10 25 MS Action Pack 5/31/06 299 299 3 MO S/L 299 0 Mass Out of Service: 6/14/10 27 Brother HLr2040 Printer 6/13/06 85 85 5 MO 150DB 64 7 Mass Out of Service: 6/14/10 28 Cingular 8125 6/27/06 403 403 5 MO 150DB 270 37 Mass Out of Service: 6/14/10 31 HP 2605DN 1/30107 424 424 5 MO 150DB 254 34 Mass Out of Service: 6/14/10 32 HP 2605 DN printer 1/30/07 509 509 5 MO 15ODB 304 41 Mass Out of Service: 6/14/10 33 HP LaserJet 2300 2/13/07 160 160 5 MO 150DB 96 13 Mass Out of Service: 6114/10 Total Other Depreciation 52,312 52,312 50,171 573 Total ACRS and Other Depreciation 52,312 52,312 50,171 573 Grand Totals 60,901 53,919 ` ` 57,905 744 NetsGrrandoTotals a fern 9 53, 9 57,909 744 P07000 PC & Network Associates, Inc 09/13/2011 1:59 PM 25-1847000 Depreciation Adjustment Report FYE: 1 2/3 112 01 0 All Business Activities AMT Adjustments/ Form Unit Asset Description Tax AMT Preferences MACRS Adjustments: Page 1 1 34 APC Battery 10 10 0 Page 1 1 36 DL 585 67 67 0 Page 1 1 37 2 APC replacement batteries 23 31 -8 Page 1 1 38 various hardware 46 63 -17 Page 1 1 39 Buffalo 320 GB NAS 0 0 0 Page I 1 40 Buffalo 500 GB NAS 0 0 0 Page 1 1 41 compaq ML 370 0 0 0 Page 1 1 42 Unisys e-action Ent Server 0 0 0 Page 1 1 43 Unisys E-action Ent Server 0 0 0 Page 1 1 44 Maxtor 750 GB USB Drive 0 0 0 Page 1 1 45 Seagate I TB USB Drive 0 0 0 Page 1. 1<: 46 Unisys Dell 0 0 0 Page 1 1 47 HPD 530 0 0 0 Page 1 1 48 HP D515(3) 0 0 0 Page 1 1 49 Portable AC Unit 0 0 0 Page 1 1 50 Portable Ac Unit 0 0 0 146 171 -25 CLIENT COPY P07000 PC & Network Associates, Inc 09/13/2011 1:59 PM 25-1847000 Future Depreciation Report FYE: 12/31/11 FYE: 12/31/2010 Form 1120S, Page 1 Date In Asset Description Service Cost Tax AMT Prior MACRS: 34 APC Battery 6/11/09 128 0 0 36 DL 585 2/15/09 834 0 0 37 2 APC replacement batteries 11/07/07 333 0 0 38 various hardware 12/31/07 664 0 0 39 Buffalo 320 GB NAS 1/10/08 159 0 0 40 Buffalo 500 GB NAS 1/13/08 259 0 0 41 compaq ML 370 3/13/08 500 0 0 42 Unisys e-action Ent Server 325/08 750 0 0. 43 Unisys E-anion Ent Server 4/15108 850 0 0 44 Maxtor 750 GB USB Drive 4115/08 117 0 0 45 Seagate 1 TB USB Drive 12/10/08 140 0 0 46 Unisys Dell 7/30/08 1,200 0 0 47 HPD 530 7/30108 -553 0 0 48 HP D515(3) 7/30/08 1,694 0 0 49 Portable AC Unit 628/08 260 0 0 50 Ponable Ac Unit 7/06/08 148 0 0 8,589 0 0 Other Depreciation: I HP Notebook NX7000 1229/03 3,155 0 0 2 Proliant Tower ML350 12/29/03 5.173 0 0 3 Various Hardware 1229/03 2,802 0 0 4 Am Combo Drive 1229/03 1,921 0 0 5 2004 mist equip 1101105 1,109 0 0 6 prior assets 1/01/04 27.690 0 0 7 SHREDDER 1/ 349 COP 8 cx6220 tape drive 4 259 �9 Office Chairs I 1 T 547 C O P 10 WDC 250 Hard Drive 323 5 f 291 0 11 IBM X235 Server 5 1,075 12 6 Chairs 4118/05 509 0 0 13 Compaq Server 4/19/05 435 0 0 14 Rack Shelving 5/10105 384 0 0 15 IT' envision Monitor 5/19/05 191 0 0 16 Hard Drives 721/05 300 0 0 17 Samsung Telephone 725/05 350 0 0 18 Sharp Copier/Fax 8115/05 355 0 0 19 6 desks-Sam's 1029105 1,193 0 0 20 Lcapscry 1223/05 400 0 0 21 Flash Drives 2114/06 201 0 0 22 Quotcwerx 5/04106 792 0 0 23 Linksys Router 5/09106 143 0 0 24 Kaseys Software License 5/16106 20,389 0 0 25 MS Action Pack 5/31/06 299 0 0 26 ConnectWisc CRM Software System 6/11/06 17,793 0 0 . 27 Brother HL-2040 Printer 6/13/06 85 0 0 28 Cingular 8125 627/06 403 0 0 29 AVG Antivirus 627/06 774 0 0 30 Dragon Naturally Speaking 10/01/06 191 0 0 31 HP 2605DN 120107 424 0 0 32 HP 2605 DN printer 1/30/07 509 00 33 HP Laserlet 2300 2/13/07 160 0 0 35 MS Anion Pack 722109 317 0 0 Total Other Depreciation 92,568 0 0 - Total ACRS and Other Depreciation 92,568 0 0 Grand Totals 101,157 0 0 P07000 09/132011 2:00 PM Schedule K Amounts Per IRC 1377(a)(2 E Form 1120S or 1.1368-1(g)(2)(i) Worksheet Page 1 2010 For calendar year 2010 or tax year beginning endin Name Employer Identification Number PC 6 NETWORK ASSOCIATES INC 25-1847000 Termination period date 06/15/10 12/31/10 Schedule K Amount Income(Loss): Ordinary business income (loss) 927 927 Net rental real estate income(loss) Other net rental income(loss) US obligation interest ................. Other interest Income 2 2 ................ Ordinary dividends ................... Qualified dividends Royalties ........................... 'Net short-term capital gain (loss) Net long-term capital gain (loss) Collectibles(28%)gain (loss). ...,... Unrecaptured Section 1250 gain Net Section 1231 gain(loss) .... Other Income(Loss): Other portfolio income(loss) Form 4684,line 41a .................. Form 4684,line 41b .................. Forth 4684,line 42 ................... Section 1256 contracts and straddles Mining exploration costs recaplu DENT COPY Other income(loss) Section 1202 2 gain gain-50%exdusio Section 1202 gain-60%exclusion Section 179 Deduction: Section 179-personal property ........ Section 179-qualified real property, Other Deductions: Cash contributions (50%) ............. Cash contributions (30%) ... Noncash contributions (50%) ... Conservation contributions (50%) Noncash contributions (30%) .......... Capital gain property(30%) ........... Capital gain property(20%) Conservation contributions (100%) Investment interest expense ........... Deductions-royalty income ............ Section 59(e)(2)expenditures Deductions-portfolio (2% floor) Deductions-portfolio (other) ........... Preproductive period expenses Commercial revitalization deduction Reforestation expenses ............... P0700D 0911 Will 2:00 PM Schedule K Amounts Per IRC 1377(a) 2) ( or 1.1368-1(g)(2)(i) Worksheet Page 2 Fero, 1120S 2010 For calendar year 2010 or tax year beginning endin Name Employer Identification Number PC 6 NETWORK ASSOCIATES INC 25-1847000 Termination period date 06 15/10 12/31/10 Schedule K Amount Other Deductions continued: Domestic Production -Oil-related Activities: Domestic production gross receipts Gross receipts from all sources Cost of goods sold allocable to DPGR Cost of goods sold from all sources Total ded directly allocable DPGR Total ded directly allocable non-DPGR Other deductions not directly allocable Domestic Production-All Activities: Domestic production gross receipts Gross receipts from all sources Cost of goods sold allocable to OPGR Gost of goods sold from all sources Total ded directly allocable DPGR Total ded directly allocable non-DPGR Other deductions not directly allocable Form W-2 wages .................... DPAD from cooperatives Qualified prod activities inoomeoil-related Qualified prod activities income-CCOPY Employer's W-2 wages LIEN T Other deductions . ,,....................... Credits: Low-inc housing (Sec 420)(5))pre-2008 Low4nc housing credit(other)pre-2008 Low-inc housing (Sec 420)(5))post-2007 Low-inc housing credit(other)post-2007 Qualified rehab exp(rental real estate) Other rental real estate credits Other rental credits ................... Undistributed capital gains credit Alcohol and cellulosic biofuel fuels credit Work opportunity credit Disabled access credit ............... Empowerment zone credit ............ Research credit ...................... Employer social security tax ........... Backup withholding .................. Other credits ........................ P07000 09/13/2011 2:00 PM Schedule K Amounts Per IRC 1377(a)(2) Forth 1120S or 1.1368-1(g)(2)(i) Worksheet Page 3 2010 For calendar year 2010 or tax year beginning endin Name Employer Identification Number PC & NETWORK ASSOCIATES INC 125-1847000 Ter urination period date 06/15/10 12/31/10 Schedule K Amount Foreign Transactions: Gross income from all sources Gross income at shareholder level Foreign gross income at corporate level: Passive ........................... General ........................... Other ............................. Deductions at shareholder level: Interest expense ................... Other ............................. Deductions at corporate level: Passive ............. General ........................... Other ............................. Total foreign taxes paid ............... Total foreign taxes accrued Reduction in taxes available for credit Foreign trading gross receipts ......... . Extraterritorial income exclusion Other foreign transactions Alternative Minimum Tax (AM to PY Adjusted gain ore losson adjustm t LIE CO —25 Depletion (other than oil and gas) Oil,gas, and geothermal gross income Oil,gas,and geothermal deductions Other AMT items .................... Items Affecting Shareholder Basis: Tax-exempt interest income ........... Other tax-exempt income Nondeductible expenses .............. Other Information: Investment expenses ................. Qualified rehab exp(other rental) Basis of energy property .............. Recap of low-inc housing cr(Sec 420)(5)) Recap of low-inc housing cr(other) Recapture of other credits Look-back int-income forecast method Section 453(1)(3) information .......... Section 453A(c) information ........... Section 1260(b)information Interest allocable to production expenses CCF nonqualified withdrawal P07000 09/1312011 2:00 PM Form 11205 Schedule K-1 Summary Worksheet 2010 Name Employer identification Number PC & NETWORK ASSOCIATES INC 1 25-1847000 Shareholder Name SSNON Column A RICHARD POWELL Column ESTATE OF RICHARD W. POWELL 27-6730044 ........... Column C Column D Schedule K Rem Column A Column B Column C Column D SCH K TOTAL 1 Ordinary income 927 927 2 Not rental RE inc 3c Net other rental inc 4 Interest income 2 2 5a Ordinary dividends 5b Qualified dividends 6 Royalties 7 Net ST capital pain Be Net LT capital gain 8b Collectibles 28%pain 8c Unrecap Sec 1250 9 Net Sec 1231 gain 10 Other income(loss) 11 Sec 179 deduction 12a Contnbubons 12b Invest interest exp 12c Sec 59(e)(2)exp 12d Other deductions 13a,c Low-inc house 4215 13b,d Low-inc house other 13e Qualif rehab exp 13f Rental RE credits 1N Other rental credits 13h Fuel alcohol credit 13i Other credits 14b Gross inc all src 14d-f Total foreign inc 14g-k Total foreign dads 141 Total foreign taxes 14m Reduct in taxes 15a Depr adjustment —25 —25 15b Adjusted gain (loss) 15c Depletion 15d Inc4l/gasigeoth 15e DedoiVgas/geoth 15f Other AMT items 16a Tax-exempt interest i6b Other tax2xempt 16c Nonded expense 1,518 1,518 16d Total property dist 5,006 278 5,284 16e Shr loan repmts 17a Investment income 2 2 17b Investment expense 18 Income (loss) 929 929 P07000 09/13/2011 2:00 PM Retained Earnings Reconciliation Worksheet Form 1120S 2010 For calendar year 2010 or tax year beginning endin Name Employer Identification Number PC & NETWORK ASSOCIATES INC 25-1847000 Schedule L - Retained Earnings Retained Earnings-Unappropriated 0 Accumulated Adjustments Account —331,216 Other Adjustments Account 0 Undistributed Previously Taxed Income 0 Schedule L,Line 24-Retained Earnings _____:::331,216 Schedule M-2 - Retained Earnings AqI Jun�ulatetl Other Unglistribuutted Retained Eami s Total cc me{1ts Ackustme�lts Previpusl Taxed Utlappdp�nateN Retained ccoun ccoun nco a Timing r erences Eamings Beg YrBal -325,343 0 0 0 -325,343 Ordinary Inc(Loss) 927 927 Other Additions 2 2 Other Reductions 1,518 1,518 Distributions 5,284 5,284 End Yr Bal — 1 6 0 _ 0 -331,216 P07000 09/13/2011 2:00 PM Form 1120S Two Year Comparison Worksheet Page 1 2009 & 2010 Name Employer Identification Number PC & NETWORK ASSOCIATES INC 25-1847000 2009 2010 Differences Gross profit percentage _..,,.,.._. ...... 86.8464 79.1524 —7.6940 Gross receipts less returns and allowances 215,796 60,664 —155,132 Income Cost of goods sold „......................_,._._,,, 28,385 12,647 —15,738 Gross profit ........................................ . 187,411 48 017 —139,394 Net gain(loss)from Form 4797 ........................ Other income(loss) ................................... Total income loss 187,411 48,017 —139,394 Compensation of officers _....................._,.,,. 37,787 13,480 _ —24,307 Salaries and wages less employment credits _...... ,_.. 23,400 51400 _ —18,000 Repairs and maintenance 110 —110 ............................. Bad debts Rents Taxes and licenses 6,339 2 908 —3,431 ................................... Interest 24,746 14,905 —9,841 .............................................. Deductions Depreciation 5 557 581 —4 ,976 ......................................... Depletion ............................................ Advertising .......................................... Pension, profit-sharing, etc., plans . ,,,,. . Employee benefit programs ............... Other deductions ........ ........ 40,253 9,816 —30,437 ................ ... .. Total deductions 138,192 47,090 —91,102 . .................................. Ordinary business income Toss 49,219 927 —48,292 Excess net passive income or LIFO recapture tax Tax from Schedule D Total tax 0 0 Estimated tax and Cn:,r a verp d Tax deposited with 0 ......................... Credit for federal tax paid on fuels ...................... Tax and Refund applied fir on Form 4466 Payments Total payments and credits .......................... Tax due(overpayment) 0 0 0 Estimated tax penalty from Form 2220 .................. Penalties and interest ................................. Net tax due(overpayment) ........................... 0 0 0 Overpayment credited to next years estimated tax Overpayment refunded P07f100 09113=11 2:00 PM Foam 11205 Two Year Comparison Worksheet Page 2 - 2009 & 2010 Name PC & NETWORK ASSOCIATES INC Employer Identlfxation Number 25-1847000 Ordinary business income(loss) 2010 Differences 49 219 927 —48 292 Net rental real estate income{toss] •—' .� ..................... Other net rental income(loss) .................. ... Income Interest income ..... 8 2 5 (Loss) Dividends ...... Royalties; Net short-tens capital gain(loss) ............. Net long-tens capital gain(loss) ....,._.... Net Section 1231 gain(loss) ........................... Other income s Section 179 deduction ................................ Charitable contributions .......... . Deductions investment interest expense ......I............. Section }(e }expenditures 59( 2 ........................... .......................... Other deductions Lov.-Income housing credit (Section 420)(5)) ............. Low-income housing credit{other} Qualified rehabilitation expenditures(re nlet real estate) Credits Other rental real estate credits ............... . Other rental credits .... ..... Alcohol and cellulosic biofuel fuels credit ................ Other credits Total foreign gross income .. Foreign Total foreign deductions .... .........—............ Transections — ..... .... Tops foreign taxes Reduction in faze voila I or ore t Post-1986 dePreda ) t —25 —50 ............ Adjusted gain or loss AMT Depletion(other than oil_a n.d ga.s. Items ).—........._................... ....... - Oil, gas, and geothermal properties-gross Income ....... Oil,gas,and geothermal propertiesEeductions Other AMT items .......... Tax-exempt interest income ............................ Items Other tax-exempt income Affecting Nondeductible expenses .............................. 5!!1 Basis Distributors 13 1 518 1 505 284 5 284 5 Repayment of bans from shareholders - Investment income 8 2 -6 ..... .......................... Other Investment expenses Information Dividend ... .''E ......... distributions pa€d from goalmutated E&P 49 227 Income(loss) B Schedule M-t Is required) 929 —48,298 M7000 09/13/2011 2:00 PM Form 11205 Two Year Comparison Worksheet Page 3 2009 & 2010 Name PC 6 NETWORK ASSOCIATES INC Employer Idantificakm Number 25-1847000 Schedule Beginning assets .............. 2010 _Differences ............ 15 346 .... 17.707 Beginning liabilities and equity ........... 15 34fi _ 17.707 2 .. ..... .......... 361 ...... .. Ending assets.,_ 17 707 Il,843 _ —5,8641 ...................................- Endin liabilities and u . 17 707 11 $43 —5,864 Net income(Ion)per books _......................... 49 214 —611 —49 825 Taxable moorne not on books Schedule Book expenses not deducted ......... ......... 1 590 1 540 M.1 ........................ Income on books not on return.. Return deductions not on books......................... .................... .. Income loss per return .. 49 227 929 —48 29$ Balance at beginning of year —374 557 —325 343 49 214 ..................... Schedule Ordinary income(loss)from pogo t .. ..... ..... . 49 219 927 —48 292 M.2 Other additions ji AAA Other 2 6 other reductions 13 1 5I8 1 505 Distributions other than dividend distri butions 4 787 5 284 497 Balance at end of year —325 343 331 216 —5 $73 Balance at beginning of year Schedule Other additions ...."..................... M•2 Other reductions ...................................... OAA Distributions other than dividend distributions Balance at end of year ..... Schedule Balance at beginning of year ........................... M-2 Distributions other than dividend distributions PTI Balance at end of year ........ " Total income(toss m Income(loss) inco a atom t Temporary tliffe Permanent difference .—. Income(loss)per tax Mum — . ... ..... ...... .. Total expanse/deduction items: ...... ....... Expense per income statement Temporary differentia Schedule ............................... M3 Pemranenf difference ............................... Deduction per lax return . . . .............. Other Items with no differences:s:...... .. . Income Voss)per Income statement Income ................... (loss)per fez return Reconctliation totals: .... ...................... Income(loss)per income statement Temporary difference ............................... Permanent difference ............................... Income loss per tax return P07000 PC & Network Associates, Inc 25-1847000 PC & Network Associates, Inc FYE: 12/31/2010 EIN: 25-1847000 Year Ending: 12/31/10 Shareholder Consent to Apply Specific Accounting Rules With Termination of Entire Shareholder's Interest With respect to the following described termination of the entire shareholder's interest, the following shareholders of the above named taxpayer, who represent all the affected shareholders of the election, do hereby consent to the corporation's election under IRC Section 1377(a)(2) and Regulation 1.1377-1(b) to have the rules provided in 1RC Section 1377(a)(1) applied as if the tax year consisted of two separate tax years. Manner of shareholder's termination: Death of 100% shareholder Date of termination: June 15, 2010 Shareholder Name and Address Shareholder Tax ID Shareholder Signature. Date Richard Powell 1166 Young Road Punxsutawney, PA 15767 184-46-5474 fistate of Richard W.Powell 1166 Young Road Punxsutawney, PA 15767-2928 27-6730044 LIENT COPY P07000 09/1312011 2:00 PM Shareholder's Allocation Per IRC 1377(a)(2) Form 1120S- or 1.1368-1(g)(2)(i) Worksheet Page 1 2010 Schedule K-1 For calendar year 2010 or tax year beginning ending Name Taxpayer Identification Number PC & NETWORK ASSOCIATES, INC 25-1847000 RICHARD POWELL Temlination period date 06/15/10 12/31/10 Schedule K-1 Amount Shareholder ownership percentage 100.000000 Income(Loss): Ordinary business income (loss) 927 927 Net rental real estate income(loss) Other net rental income(loss) US obligation interest ................. Other interest income 2 2 ................ Ordinary dividends .................— Qualified dividends ................... Royalties ........................... Net short-tern capital gain (loss) Net long-term capital gain (loss) Collectibles (28%) gain (loss) ._.._.. Unrecaptured Section 1250 gain Net Section 1231 gain (loss) .......... Other Income(Loss): Other portfolio income (loss) .......... Forth 4684,line 41a .................. Form 4684,line 41 b .................. Form 4684,line 42 Section 1256 contracts and stra es C //�\\ PY Mining exploration costs recapt L I E N T ■ ■ Other income(loss) \\'// ................. Section 1202 gain-50%exclusion Section 1202 gain-60%exclusion Section 179 Deduction: Section 179-personal property Section 179-qualified real property Other Deductions: Cash contributions (50%) ............. Cash contributions (30%) ............. Noncash contributions (50%) Conservation contributions (50%) Noncash contributions (30%) Capital gain property(30%) .._.._.. Capital gain property(20%) Conservation contributions (100%) Investment interest expense ........... Deductions-royally income Section 59(e)(2) expenditures Deductions-portfolio (2% floor) Deductions-portfolio (other) Preproductive period expenses Commercial revitalization deduction Reforestation expenses ............... P07000 09113/2011 2:00 PM Shareholder's Allocation Per IRC 1377(a)(2) I Fora, 11205 or 1.1368-1(g)(2)(i) Worksheet Page 2 2010 Schedule K-1 For calendar year 2010 or tax year beginning ending Name Taxpayer Identification Number PC & NETWORK ASSOCIATES, INC 25-1847000 RICHARD POWELL Tennination period date 06/15/10 12/31/10 Schedule K-1 Amount Shareholder ownership percentage 100.000000 Other Deductions continued: Domestic Production -Oil-related Activities: Domestic production gross receipts Gross receipts from all sources Cost of goods sold allocable to DPGR Cost of goods sold from all sources Total ded directly allocable DPGR Total ded directly allocable non-DPGR Other deductions not directly allocable Domestic Production -All Activities: Domestic production gross receipts Gross receipts from all sources Cost of goods sold allocable to DPGR Cost of goods sold from all sources Total ded directly allocable DPGR Total ded directly allocable non-DPGR Other deductions not directly allocable Form W-2 wages .................... DPAD from cooperatives COPY Qualified prod activities income rela I Qualified prod activities income- I activ'ti Employers W-2 wages Other deductions - .................... Credits: Low-inc housing (Sec 420)(5))pre-2008 Low-inc housing credit(other) pre-2008 Low-inc housing (Sec 420)(5))post-2007 Low-inc housing credit(other) post-2007 Qualified rehab exp(rental real estate) Other rental real estate credits - Other rental credits ................... Undistributed capital gains credit Alcohol and cellulosic biofuel fuels credit Work opportunity credit ............... Disabled access credit ............... Empowerment zone credit ............ Research credit ...................... Employer social security tax ........... Backup withholding Other credits ........................ P070M 09/132011 2U0 PM Shareholder's Allocation Per IRC 1377(a) 2 t Form 1120S or 1.1368-1(g)(2)(i) Worksheet Page 3 2010 Schedule K-1 For calendar year 2010 or tax year beciinning ending Name Taxpayer Identification Number PC 6 NETWORK ASSOCIATES, INC 25-1847000 RICHARD POWELL Termination period date 06/15/10 12/31/10 Schedule K-1 Amount Shareholder ownership percentage 100.000000 Foreign Transactions: Gross income from all sources Gross income at shareholder level Foreign gross income at corporate level: Passive ........................... General Other Deductions at shareholder level: Interest expense ................... Other ............................. Deductions at corporate level: Passive General ........................... Other ............................. Total foreign taxes paid ............... Total foreign taxes accrued Reduction in taxes available for credit Foreign trading gross receipts Extraterritorial income exclusion Other foreign transactions L I E N T COPY Altemative Minimum Tax(AM Item Post-1966 depreciation atljusime 2 —25 Adjusted gain or loss ................. Depletion(other than oil and gas) ... Oil,gas, and geothermal gross income Oil,gas,and geothermal deductions Other AMT items .................... Items Affecting Shareholder Basis: Tax-exempt interest income ........... Other tax-exempt income ............. Nondeductible expenses .... ......... Other Information: Investment expenses Qualified rehab exp(other rental) Basis of energy property .............. Recap of lowinc housing a(Sec 420)(5)) Recap of low-inc housing a(other) Recapture of other credits Look-back int-income forecast method Section 453(1)(3)information .......... Section 453A(c)information ........... Section 1260(b)information Interest allocable to production expenses CCF nonqualified withdrawal P070M 09113/2011 2:00 PM Shareholder's Allocation Per IRC 1377(a)(2) or 1.1368-1(g)(2)(i) Worksheet Page 4 Forth 1120S 2010 Schedule K-1 For calendar year 2010 or tax year beginning ending Name - Taxpayer Identification Number PC 6 NETWORK ASSOCIATES, INC 25-1847000 ESTATE OF RICHARD W. POWELL 27-6730044 Termination period date 06/15/10 12/31/10 Schedule K-1 Amount Shareholder ownership percentage 100.000000 Income(Loss): Ordinary business income (loss) Net rental real estate income(loss) Other net rental income(loss) ..,. US obligation interest ................. Other interest income Ordinary dividends ................... Qualified dividends ................... Royalties ........................... Net short-tern capital gain (loss) Net long-term capital gain(loss) ...... Collectibles(28%)gain (loss) ... Unrecaptured Section 1250 gain Net Section 1231 gain(loss) Other Income(Loss): Other portfolio income(loss) .......... Form 4684,line 41a Forth 4684,line 41b .................. Forth 4684,line 42 Section 1256 contracts and stra es COPY Mining exploration cosLS recapl � L I ENT Other income(loss) .................. Section 1202 gain-50%exclusion . Section 1202 gain-60%exclusion Section 179 Deduction: Section 179-personal property ....._.. Section 179-qualified real property . Other Deductions: Cash contributions (50%) Cash contributions (30%) ............. Noncash contributions (50%) Conservation contributions (50%) ...... Noncash contributions (30%) Capital gain property(30%) ........... Capital gain property(20%) ........... Conservation contributions (100%) . ... Investment interest expense ........... Deductions-royalty, income ............ Section 59(e)(2)expenditures Deductions-portfolio (2% floor) Deductions-portfolio (other) . Preproductive period expenses Commercial revitalization deduction Reforestation expenses ............... M70W 09/132011 2:00 PM Shareholder's Allocation Per IRC 1377(a)(2) f or 1.1368-1(g)(2)(i) Worksheet Page 2 Form 1120S 2010 Schedule K-1 For calendar year 2010 or tax year beginning ending Name Taxpayer Identification Number PC 6 NETWORK ASSOCIATES, INC 25-1847000 ESTATE OF RICHARD W. POWELL 27-6730044 Termination period date 06/15/10 12/31/10 Schedule K-1 Amount Shareholder ownership percentage 100.000000 Other Deductions continued: Domestic Production -Oil-related Activities: Domestic production gross receipts .... Gross receipts from all sources Cost of goods sold allocable to DPGR . Cost of goods sold from all sources .. Total ded directly allocable DPGR . Total ded directly allocable non-DPGR Other deductions not directly allocable . Domestic Production -All Activities: Domestic production gross receipts Gross receipts from all sources Cost of goods sold allocable to DPGR .. Cost of goods sold from all sources . Total ded directy allocable DPGR Total ded directly allocable non-DPGR Other deductions not directly allocable . Form W-2 wages .................... DPAD from cooperatives Qualified prod activities ince W Qualified prod activities income- acti L I E N T COPY Employees W-2 wages ............... Other deductions .................... Credits: Low4nc housing (Sec 420)(5))pre-2008 Low-inc housing credit(other)pre-2008 Lowwinc housing (Sec 420)(5))post-2007 Low-inc(rousing credit(other)post-2007 Quaffed rehab exp(rental real estate) Other rental real estate credits Other rental credits ................... Undistributed capital gains credit Alcohol and cellulosic biofuel fuels credit Work opportunity credit ............... Disabled access credit ............... Empowerment zone credit ............ Research credit ...................... Employer social security tax ........... Backup withholding .................. Other credits ........................ P07000 09/13/2011 2'00 PM Shareholder's Allocation Per IRC 1377(a)(2) ii or 1.1368-1(g)(2)(i) Worksheet Page 3 Forth 1120S 2010 Schedule K-1 For calendar year 2010 or tax year beginning ending Name Taxpayer Identification Number PC & NETWORK ASSOCIATES, INC 25-1847000 ESTATE OF RICHARD W. POWELL 27-6730044 Termination period date 06/15/10 12/31/10 Schedule K-1 Amount Shareholder ownership percentage 100.000000 Foreign Transactions: Gross income from all sources Gross income at shareholder level Foreign gross income at corporate level: Passive ........................... General ........................... Other Deductions at shareholder level: Interest expense ................... Other ............................. Deductions at corporate level: Passive ........................... General ........................... Other ............................. Total foreign taxes paid ............... Total foreign taxes accrued Reduction in taxes available for credit Foreign trading gross receipts Extraterritorial income exclusion Other foreign transactions GIM LIENT C Alternative Minimum Tax(AM Post-1986 depreciation adjustm Adjusted gain or loss ................. Depletion (other than oil and gas) Oil,gas, and geothermal gross income Oil,gas, and geothermal deductions Other AMT items .................... Items Affecting Shareholder Basis: Tax-exempt interest income ........... Other tax-exempt income ............. Nondeductible expenses Other Information: Investment expenses ................. Qualified rehab exp (other rental) Basis of energy property Recap of low-inc housing cr(Sec 420)(5)) Recap of low-inc housing cr(other) Recapture of other credits Look-back int-income forecast method Section 453(1)(3)information .......... Section 453A(c) information ........... Section 1260(b)information Interest allocable to production expenses CCF nonqualifed withdrawal P07000 091132011 2:00 PM Shareholder's Basis Worksheet Page 1 Form 1120S 2010 Schedule K-1 For calendar year 2010 or tax year be innin ,ending Name PC 6 NETWORK ASSOCIATES, INC Taxpayer Identification Number 25-1847000 RICHARD POWELL Stock Basis 1. Beginning of year stock basis 0 ...................................................................................... 2. Capital contributions .............................................................................................. Additions: 3. Ordinary business income ..................................................................... 4. Net rental real estate income ............................................................... 5. Other net rental income .................................................................... 6. Interest, dividends and royalfies 2 ............................................................. 7. Net capital gains .......................................................................... 8. Net section 1231 gain 9. Tax-exempt interest and other income 10. Other income - 929 11. Other increases INCREASE PIC 12. Subtotal (Add line 1 through line 11) ................................................................................ 929 Subtractions: 13. Distributions TOTAL DISTRIBUTIONS 51006 929 14. Total losses and deductions applied against stock basis (See Shareholders Basis Worksheet Page 2) 15. Other decreases 16.Amount used to restore loan basis ................................................................................. 17. End of year stock basis (Subtract the sum of lines 13 through 16 from line 12) 0 ........................................... 18. Beginning of year loan basis CLENT Iasi U py 19. Loans to corporation .............................................................................................. 20. Loan basis restored-amount used in prior years to offset losses ...................................................... 21. Other increases 22. Loan repayments ................................................................................................ 23. Total losses and deductions applied against loan basis (See Shareholders Basis Worksheet Page 2) ...................... 24. Other decreases 25. End of year loan basis (Subtract the sum of lines 22 through 24 from the sum of lines 18 through 21) 0 ....................... 26. End of year stock and loan basis (Add line 17 and line 25) 0 Gain Recognized on Excess Distributions 27. Distrbutions ..................................................................................................... 5,006 28. Stock basis before distributions and loss items 929 ...................................................................... 29. Gain recognized on excess distributions (Subtract line 28 from line 27) 4,077 Gain Recognized on Repayment of Shareholder Loan 30. Loan basis at beginning of tax year ................................................................................. 31. Basis restored-amount used in prior years to offset losses ............................................................ 32. Loan basis before loan repayment (Add line 30 and line 31) 33. Face amount of shareholder loan at beginning of tax year 34. Loan repayments to shareholder during tax year ..................................................................... 35. Nontaxable return of loan basis ((Line 32 divided by line 33)multiplied by line 34)) ....................................... 36. Gain recognized on repayment of shareholder loan (Subtract line 35 from line 34) Note to shareholder: This worksheet was prepared based on corporation records. Please consult with your tax advisor for adjustments. E J C Eor T cO 00m Ln m a mm W n myo N Mm K 0 F O V m J y 3 o O Q O r b r p O N p O n V a o rn p N N N N N d .-I m m7 m °m in m - M m f0 m ou m N m Y3 d o f N N N E w c aqi N M M E as a p o L m J m N x 5 u 0 C o Q m N y y 2 > 0 Q N N y w^ O H vI Q j m O ° '" O p L N 'O a o „d, Y o in v o o c N N S n m v m m N m " .-I L ai0i N F N Liu M M N J 8 `o m m c 0 N C N In U � o N M v m ~ U IL ry O y W � m m H cy m r o 0 g'J N � N m Y� o[ 3 PG 3 y ^ ^ E t H C N o o y a 3 ° o ° ° ° C NC y ° ° \ o y y C % ° a Y o y m a Q o n o o n' 8 c i° �' 'G v o a `m d o 0 2 a' a' Q m > cT m 'c° o a C°o d m Q£' E aa°' c v o a m o m � -mv E o £ O L y m O m z o O z o m m g O o z y z z c c m 3 F z 0o z r S P07000 09/1312011 2:00 PM Shareholder's Basis Worksheet Page 1 Form 1120S 2010 Schedule K-1 I For calendar year 2010 or tax year beginning ending Name PC 6 NETWORK ASSOCIATES, INC Taxpayer Identification Number 25-1847000 ESTATE OF RICHARD W. POWELL 27-6730044 Stock Basis 1. Beginning of year stock basis ...................................................................................... 2. Capital contributions .............................................................................................. Additions: 3. Ordinary business income .................................................................. 4. Net rental real estate income ............................................................... 5. Other net rental income 6. Interest, dividends and royalties ............................................................. 7. Net capital gains .......................................................................... 8. Net section 1231 gain ..................................................................... 9. Tax-exempt interest and other income ....................................................... 10. Other income 11. Other increases PAYMENT OF S CORP EXPENSES 3,446 12. Subtotal (Add line 1 through line 11) 3,446 Subtractions: 13. Distributions 278 ..................................................................................................... 14.Total losses and deductions applied against stock basis (See Shareholder's Basis Worksheet Page 2) 15. Other decreases 16. Amount used to restore loan basis ................................................................................. 17. End of year stock basis (Subtract the sum of lines 13 through 16 from line 12) 3,168 C o n asi 18. Beginning of year loan basis E COPY 19. Loans to corporation ................ .. ............... ................... 20. Loan basis restored-amount used in prior years to offset losses ...................................................... 21. Other increases 22. Loan repayments ................................................................................................ 23. Total losses and deductions applied against loan basis (See Shareholders Basis Worksheet Page 2) ...................... 24. Other decreases 25. End of year loan basis (Subtract the sum of lines 22 through 24 from the sum of lines 18 through 21) 0 ....................... 26. End of year stock and loan basis (Add line 17 and line 25) 3,168 Gain Recognized on Excess Distributions 27. Distributions 278 ..................................................................................................... 28. Stock basis before distributions and loss items 3,446 29. Gain recognized on excess distributions (Subtract line 28 from line 27) 0 Gain Recognized on Repayment of Shareholder Loan 30. Loan basis at beginning of tax year ................................................................................. 31. Basis restored-amount used in prior years to offset losses ......................................................... 32. Loan basis before loan repayment (Add line 30 and line 31) ........................................................... 33. Face amount of shareholder loan at beginning of tax year ............................. 34. Loan repayments to shareholder during tax year ..................................................................... 35. Nontaxable return of loan basis ((Line 32 divided by line 33)multiplied by line 34)) 36. Gain recognized on repayment of shareholder loan (Subtract line 35 from line 34).............................. * NO GAIN RECOGNIZED IN CURRENT YEAR. Note to shareholder: This worksheet was prepared based on corporation records. Please consult with your tax advisor for adjustments. P07000 PC & Network Associates, Inc 9/13/2011 1:59 PM 25-1847000 Federal Statements FYE: 12/31/2010 Form 11205 Page 1 Line 1a - Gross Receipts Description Amount GROSS SALES $ 60, 664 TOTAL $ 60, 664 Form 1120S Page 1 Line 12 -Taxes and Licenses Description Amount PAYROLL TAXES $ 2, 908 TOTAL $ 2, 908 Form 1120S. Page 1. Line 13 - Interest Description Amount INTEREST/FINANCE CHARGES $ 14, 905 TOTAL $ 14, 905 CLIENT COPY P07000 PC & Network Associates, Inc 9113/2011 1:59 PM 25-1847000 Federal Statements FYE: 12/31/2010 Form 1120S Page 2 Schedule K Line 4 - Interest Income Description Amount OTHER INTEREST $ 2 TOTAL $ 2 CLIENT. COPY i i a P07000 PC & Network Associates, Inc 9/13/2011 1:59 PM 25-1847000 Federal Statements FYE: 12/31/2010 Form 1120S. Page 3. Schedule K. Line 16c - Nondeductible Expenses Description Amount SHAREHOLDER HEALTH INSURANCE $ 1,516 TOTAL $ 1,516 Form 1120S. Page 3. Schedule K. Line 17a - Investment Income Description Amount INTEREST INCOME $ 2 TOTAL $ 2 CLIENT COPY 1 P07000 PC & Network Associates, Inc 9/13/2011 1:59 PM 25-1847000 Federal Statements FYE: 12/31/2010 Form 1120S. Page 4. Schedule L. Line 3 - Inventories Beginning End Description of Year of Year INVENTORY $ 2,080 $ 2, 080 TOTAL $ 2, 080 $ 2, 080 Form 1120S. Page 4. Schedule L. Line 17 - Mortgages Notes Bonds Payable in Less Than One Year Beginning End Description of Year of Year CREDIT CARDS - PCNAI & RWP $ 137, 663 $ 129,820 LINE OF CREDIT 36, 952 39,002 CURRENT PORTION LTD 7, 500 TOTAL $ 174, 615 $ 176,322 Form 1120S. Page 4, Schedule L. Line 19 - Loans from Shareholders Beginning End Description of Year of Year LOAN FROM RWP $ $ TOTAL $ 0 $ 0 F rm 11205 a Norilages.LtA.%Iojsa abl in One Year g r More I Beginning End Description of Year of Year SBA LOANS $ 103, 335 $ 102,341 TOTAL $ 103,335 $ 102,341 Form 1120S Page 4 Schedule L Line 23 -Additional Paid-In Capital Beginning End Description of Year of Year $ 56, 896 $ 56,896 TOTAL $ 56, 896 $ 56,896 1 1 1120S U.S. Income Tax Return for an S Corporation DMBNo.1545-0130 Form ► Do not file this form unless the corporation has filed Form 2553 Department of the Treasury to elect to be an S corporation. 2006 Internal Revenue Service ► See separate instructions. For calendar year 2006 or tax year beginning 2006,ending A Effective date of Name C Employer Identification number S election Use the IRS PC & Network Associates, Inc. 25-1847000 10/12/99 label. Number,street,and room or suite no.If a P.O.box,see instructions. D Date incorporated B Business ad'. . Other- code number v,ty wise, 18 North Hanover Street 10/12/99 (see instructions) print Or City or town,state,and ZIP code E Total assets(see instructions) 541519 type. Carlisle PA 17103 $ 93, 841. F Check if: (1) Initial return (2) Final return (3) Ll Name change (4) U Address change (5) LJ Amended return G Enter the number of shareholders in the corporation at the end of the tax year . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . ►__�-1-T H Check if Schedule M-3 is required (attach Schedule M-3) . ► I I Caution.lnclude onl trade or business income and ex enses on lines la throw h 21. See the instructions for more information. 1 a Gross receipts or sales. 292, 481 . b Less on and allowances. I c Bal ► 1 c 292, 4 81 . 1 2 Cost of goods sold (Schedule A,line 8). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 N C 3 Gross profit.Subtract line 2 from line 1c . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 292, 4 81 . O 4 Net gain (loss)from Form 4797, Part Il, line 17 (attach Form 4797) . . . . . . . . . . . . . . . . . . . . . . . 4 M 5 Other income(loss) (attach statement) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 E 6 Total income loss).Add lines 3 through 5. . ► 6 2 92, 481 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 Compensation of officers. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 37, 787 . D 8 Salaries and wages(less employment credits) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 118, 784 . E 9 Repairs and maintenance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 320 . D 10 Bad debts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 U C 11 Rents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 37, 826. T 12 Taxes and licenses. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 14, 372 . 1 O 13 Interest. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 23, 516. N 14 Depreciation not claimed on Schedule A or elsewhere on return(attach Form 4562) . . . . . . . . . . . . . . 14 20, 965. S 15 Depletion(Do not deduct oil and gas depletion.). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 s 16 Advertising. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16 23, 619. E E 17 Pension, profit-sharing,etc,plans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17 1 N 18 Employee benefit programs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 2,235. T 19 Other deductions(attach statement) . . . . ' .STMT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19 60, 741 . R 20 Total deductions.Add lines 7 through 19 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ► 20 340, 165 . S 21 Ordinary business income(loss).Subtract line 20 from line 6 . 21 —47, 684 . . . . . . . . . . . . . . . . . . . . . . . 22a Excess net passive income or LIFO recapture T tax(see instructions) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22 a A X b Tax from Schedule D(Form 1120S) . . . . . . . . . . . . . . . . . . . . . 22 b _ c Add lines 22a and 22b(see instructions for additional faxes). . . . . . . . . . . . . . . . . . . . . . . . . 22 c A 23a 2006 estimated tax payments and 2005 overpayment credited to 2006 . . . 23a N D b Tax deposited with Form 7004 . . . . . . . . . . . . . . . . . . . . . . . . . 23bi 0. P c Credit for federal tax paid on fuels (attach Form 4136) . . . . . . . . . . . . 23c A d Credit for federal telephone excise tax paid (attach Form 8913). . . . . . . 23d _ Y M e Add lines 23a through 23d . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23e 0. E 24 Estimated tax penalty(see instructions). Check if Form 2220 is attached . . . . . . . . . . . . . . . ► ❑ 24 N 25 Amount owed.If line 23e is smaller than the total of lines 22c and 24,enter amount owed . . . . . . . . . . . . . . . . . . . 25 0 . T S 26 Overpayment.If line 23e is larger than the total of lines 22c and 24,enter amount overpaid . . . . . . 26 27 Enter amount from line 26 Credited to 2007 estimated tax ► Refunded ► 27 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 Sign belief,it is true,correct,and complete.Declaration of preparer(other than taxpayer)is based on all information of which preparer has any knowledge. Here I May the IRS discuss this return with the preparer shown below Ill, I(see instructions? Signature of officer Data Title Yes No Preparer's Date Preparer's SSN or PTIN signature , Check if self- Pald employed Preparer's Firm's name Self—Prepared EIN Use Only (or ours if self-employed), D address,antl ZIP codo Phone no. BAA For Privacy Act and Paperwork Reduction Act Notice,see the separate instructions. SPSA0112 01/05/07 Form 1120S(2006) Form 1120S 2006 PC 1, Network Associates, Inc. 25-1847000 Page 2 Schedule A Cost of Goods Sold see instructions 1 Inventory at beginning of year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 2 Purchases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 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 9 a Check all methods used for valuing closing inventory: (t) Cost as described in Regulations section 1.471-3 (ii) Lower of cost or market as described in Regulations section 1.471-4 (lit) 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 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 d e If property is produced or acquired for resale,do the rules of section 263A apply to the corporation? . . . . . . . . . . Yes No If Was there any change in determining quantities,cost,or valuations between opening and closin invento ?If'Yes,'attach explanation Yes No . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Schedule B Other Information see instructions Yes No 1 Check accounting method: a X Cash b LJ Accrual c LJ Other(specify) ► __________ —� 2 See the instructions and enter the: a Business activity. ► Computer_or IT Related Services bProductorservlce. ► Computer Services 3 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 and employer identification number(EIN),(b)percentage owned,and(c)if 100%owned, was a QSub election made? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . X 4 Was the corporation a member of a controlled group subject to the provisions of section 1561? . . . . . . . . . . . . . . . . X 5 Has this corporation filed,or is it required to file,a return under section 6111 to provide information on any reportable transaction?. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . X 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 Enter the accumulated earnings and profits of the corporation at the end of the lax 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. . . . . . . . . . . . . . . . . . . . X 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. Schedule K Shareholders' Pro Rata Share Items Total amount 1 Ordinary business income(loss)(page 1,line 21) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 –47 684 . 2 Net rental real estate Income(loss)(attach Form 8825). . . . . . . . . . . . . . . . . . . . 2 3 a Other gross rental income(loss) . . . . . . . . . . . . . . . . . . . . . . 3 a b Expenses from other rental activities(attach statement) . . . . . . . . . . . . . . . 3161 _ I N c Other net rental income(loss).Subtract line 3b from line 3a . . . . . . . . . . . . . . . . . . . . . . . . 3 c C4 Interest income. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 O M 5 Dividends: a Ordinary dividends . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5a E b Qualified dividends . . . . . . . . . . . . . . . . . . . . . Sb !_ (L 6 Royalties. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 O 7 Net short-term capital gain(loss)(attach Schedule D(Form 1120S)) . . . . . . . . . . . . . . . . . . . . . . 7 S) 8 a Net long-term capital gain(loss)(attach Schedule D(Form 11205)) . . . . . . . . . . . . . . . . . . . . . . 8 a b Collectibles(28%)gain(loss). . . . . . . . . . . . . . . . . . . . . . . . . 8 b c Unrecaptured section 1250 gain(attach statement) . . . . . . . . . . . . . . . . . 8 c _ 9 Net section 1231 gain(loss)(attach Form 4797) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 10 Other income loss see instructions . 10 SPSA0112 01r05ro7 Form 11205(2006) Form 1120S 2006 PC & Network Associates Inc. 25-1847000 Page 3 Shareholders' Pro Rata Share Items(continued) Total amount Deduc- 11 Section 179 deduction(attach Form 4562) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 tions 12a Contributions. . . . . . . . . . . . . . . . . Cash .contribu.tion . (.SA$) . . . . . . . 12a 245. b Investment interest expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12b c Section 59(e)(2)expenditures (1) Type ► (2) Amount ► 12c 2 ------------------ d Other deductions see instructions . . .Type► 12d Credits 13a Low-income housing credit(section 420)(5)) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13a b Low-income housing credit(other) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13b c Oualified rehabilitation expenditures(rental real estate)(attach Form 3468) . . . . . . . . . . . . . . . . . . . 13c d Other rental real estate credits(see instrs) Type ► 13d -------------------- e Other rental credits(see instrs) Type► 13e f Credit for alcohol used as fuel(attach Form 6478) . . . . . . . . . . . . . . . . . . . . . . . . . 13f Other credits see instructions . .Type ► 13 Foreign 14a Name of country or U.S.possession . . . . .► Trans- b Gross income from all sources . . . . . . . . . . . . . . . 141a actions c Gross income sourced at shareholder level. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14c Foreign gross income sourced at corporate level dPassive . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14d e Listed categories(attach statement) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14e If General limitation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14f Deductions allocated and apportioned at shareholder level 9 Interest expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 hOther . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14h Deductions allocated and apportioned at corporate level to foreign source income iPassive . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 141 J Listed categories(attach statement) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 k General limitation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14k Other information Total foreign taxes(check one): ► ❑ Paid F] Accrued . . . . . . . . . . . . . . . . 141 m Reduction in taxes available for credit (attach statement) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14m n Other foreign lax information attach statement . . . . . . . . . . . . . . . . . . . . . . . . . Alterna- 15a Post-1986 depreciation adjustment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15a -6, 334 . five Mini- b Adjusted gain or loss. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15b mum c Depletion(other than oil and gas) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15c Tax d Oil,gas,and geothermal properties—gross income . . . . . . . . . . . . . . . . . . . . . . . . 15d (AMT) Items a Oil,gas,and geothermal properties—deductions . . . . . . . . . . . . . . . . . . . . . . . . . ISO f Other AMT items attach statement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15f Items 16a Tax-exempt interest income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16a ANec- b Other tax-exempt income. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16b ting Share- c Nondeductible expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16c 272 . holder Basis d Property distributions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16d e Repayment of loans from shareholders. . 16e 3, 212 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Other 17 a Investment income. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17a Inform- ation b Investment expenses. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17b c Dividend distributions paid from accumulated earnings and profits . . . . . . . . . . . . . . . . . 17c d Other items and amounts 1 attach statement 1 Recon- 18 Income/loss reconciliation.Combine the amounts on lines 1 through 10 in the far right col- ciliation umn. From the result,subtract the sum of the amounts on lines 11 lhrou h 12d and lines 141 . 18 —47, 929. BAA Form 11205(2006) SPSA0134 09127106 Form 1120s 2006 PC & Network Associates, Inc. 25-1847000 Page 4 Schedule L Balance Sheets per Books Beginning of tax year End of tax year Assets (a) (b) (c) (d) 1 Cash . . . . . . . . . . . . . . . . . . . . . . 9 029. 17, 976. 2 a Trade notes and accounts receivable. . . . . I to Less allowance for bad debts. . . . . . . . . 3 Inventories . . . . . . . . . . . . . . . . . . 4, 608. 180. 4 U.S.government obligations . . . . . . . . . 5 Tax-exempt securities(see instructions) . . . 6 Other current assets(attach stmt). . . . . . . . . . 7 Loans to shareholders . . . . . . . . . . . . 8 Mortgage and real estate loans. . . . . . . . 9 Other Investments(attach statement) . . . . . . . . 10a Buildings and other depreciable assets . . . 50, 078 . 129, 929. to Less accumulated depreciation. . . . . . . 40, 897 . _ 9 1_81 . 53, 744 . 76, 185. 11 a Depletable assets . . . . . . . . . . . . . . b Less accumulated depletion . . . . . . . . . 12 Land(net of any amortization) . . . . . . . . 13 a Intangible assets(amortizable only). . . . . . _ b Less accumulated amortization. . . . . . . . 14 Other assets(attach stmt) . . . . . . . . . . 15 Total assets . . . . . . . . . . . . . . . . . . 22, 818 . 93, 841 . Liabilities and Shareholders' Equity 1 16 Accounts payable . . . . . . . . . . . . . . .j 17 Mortgages,notes,bonds payable in less than 1 year. . . 74, 726. 121, 747 . 18 Other current liabilities(attach stmt). .Ln 18. St . 853. 1, 088 . 19 Loans from shareholders . . . . . . . . . . . 48 684 . 20, 162 . 20 Mortgages,notes,bonds payable In 1 year or more . . 136, 250. 252, 819. 21 Other liabilities(attach statement). . . . . . . . . . 22 Capital stock . . . . . . . . . . . . . . . . . 7 500. 7, 500 . 23 Additional paid-in capital . . . . . . . . . . . 52 202 . 24 Retained earnings . . . . . . . . . . . . . . —245 195. —361 677 . 25 Adjustments to shareholders'equity(alt stmt). . . . . 26 Less cost of treasury stock . . . . . . 27 Total liabilities and shareholders'equit y 22, 818. 93, 841 . Schedule M-1 I Reconciliation of Income (Loss) per Books With Income (Loss) per Return Note:Schedule M-3 required instead of Schedule M-1 if total assets are$10 million or more—see instructions 1 Net income(loss)per books . . . . . . . . —48, 201. 5 Income recorded on books this year not Included 2 Income Included on Schedule K,tins 1,2,3c,4,5a,6,7, on Schedule K,lines 1 through 10(itemize): 8a,9,and 10,not recorded on books this year(itemize): a Tax-exempt interest $ ---------------------- -------------------- 3 Expenses recorded on books this year not 6 Deductions Included on Schedule K,lines 1 through included on Schedule K,lines 1 through 12, 12,and 141,not charged against book income this and 141(itemize): year(itemize): a Depreciation . . . . $ a Depreciation . $ ----------- ----------- b Travel and enlertainment $_______ 272 * -------------------- _________________ _ 272. 7 Addlin—W and 6. . . . . . . . . . . . . 4 Add lines 1 throw h 3. . . —47, 929. 8 Income(loss)(Schedule K,In 18).Ln 4 less In 7 —47, 929. Schedule M-2 ' Analysis of Accumulated Adjustments Account, Other Adjustments Account, and Shareholders' Undistributed Taxable Income Previously Taxed (see instructions) (a)Accumulated (b)Other (c)Shareholders'undis- adjustments account adjustments account tributed taxable income 1 1 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. . SPSA0134 09rz7ro6 Form 1120S(2006) OMB No.1545-0172 Form 4562 Depreciation and Amortization (Including Information on Listed Property) 2006 Deparbnent of the Treasury Attachment G7 Internal Revenue Service See separate Instructions. Attach to our tax return. sequence No. Name(s)shmm%on return Identifying number PC & Network Associates, Inc. 25-1847000 Business or activity to which this torn relates Form 1120S Line 21 Part I Election To Expense Certain Property Under Section 179 Note:If you have any listd e ro art , corn late Part V before you complete Part 1. 1 Maximum amount.See the instructions for a higher limit for certain businesses . . . . . . . . . . . . . . . . . . 1 $108, 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 $430, 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 2005 Form 4562 . . . . . . . . . . . . . . . . . . . . . . 10 11 Business income limitation. Enter the smaller of business income(not less than zero)or line 5(see instrs) . . . . . 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 2007.Add lines 9 and 10,less line 12. . . ► 13 Note: Do not use Part ll or Part/l/below for listed property. Instead, use Part V. Part II 1 Special Depreciation Allowance and Other Depreciation Do not include listed property.)(See instructions. 14 Special allowance for qualified New York Liberty or Gulf Opportunity Zone property(other than listed property)placed in service during the lax year(see instructions) . . . . . . . . . . . . . . . . . . . . . . . . . . 14 15 Property subject to section 168(f)(1)election . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 16 Other depreciation(including ACRS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16 17, 017 . 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 2006. . . . . . . . . . . . . . . . . 17 3 718. 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. . ► n Section B—Assets Placed in Service During 2006 Tax Year Using the General Depreciation S stem (a) (b)Month and (c)Basis for depredation (d) (e) (f) (g)Depreciation Classiliwdon of property year placed (businessanveslment use Recovery period Convention Method deduction in service only—see instructions) 19a 3-year property I b5- ear property. . . . . . 429. 5.0 Vrs HY 20ODB 86. c 7-year property d 10-year property . e 15-year property f 20-year property 25-year property . . . . . 25 yrs S/L h Residential rental 27. 5 yrs MM S/L property . . . . . . . . 27. 5 yrs MM S/L i Nonresidential real 39 yrs MM S/L property . . . . . . . . . MM S/L Section C — Assets Placed in Service During 2006 Tax Year Using the Alternative Depreciation System 20 a Class life . S/L Is .12-year. 12 rs S/L c 40- ear. . . . 40 rs MM S/L Part IV Summa see instructions 21 Listed property.Enter amount from line 28 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 144 . 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 Instructions . . . . . . 22 20, 965. 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 BAA For Paperwork Reduction Act Notice,see separate instructions. FDIZ0812 06/22/06 Form 4562(2006) Form 4562(2006) PC & Network Associates, Inc. 25-1847000 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 passen er automobiles. 24a Do you have evidence to support the business/investment use claimed? . . X I Yes No 24b If'Yes,'is the evidence written?. X I Yes No (a) (b) (c) (d) (e) (f) (g) (h) (7 eusinessl Type hiproperty(list Date placed Cost or Basis for depreciation Recovery Method/ Depreciation Elected investment business/investment vehicles first) In service use other basis ( period Convention deduction section 179 percentage use only) cost 25 Special allowance for qualified New York Liberty or Gulf Opportunity 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: Samsun Telephon e 07/25/05 100 . 00 350. 350 . 1 7 .00 120ODB/HYI 86. Cingular 8125106/27/06 110 i.00 403. 403. 7 .00 200DB/HY 58 . 27 Property used 50%or less in a qualified business use: 28 Add amounts in column (h),lines 25 through 27. Enter here and on line 21,page 1 . . . . . . . . . 28 144 . 29 Add amounts in column , 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. (a) (b) (c) (d) (e) (f) 30 Total business/investment miles driven Vehicle 1 Vehicle 2 Vehicle 3 Vehicle 4 Vehicle 5 Vehicle 6 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 . . . . . . . . . . . . . Yes No Yes No Yes No Yes No Yes No Yes No 34 Was the vehicle available for personal use 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, Yes No by your 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 jAmortization (a) (b) (c) (d) (e) (f) Description of costs Date amortization Amortizable Cod. Amortization Amortization begins amount section period or for this year Percentage 42 Amortization of costs that begins during our 2006 tax year see instructions : 43 Amortization of costs that began before your 2006 tax year. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43 44 Total.Add amounts in column(f). See instructions for where to report . 44 FDlz0812 06122106 Form 4562(2006) 671106 Final K-1 Amended K-1 OMB No.1545-0130 Schedule K-1 2006 part III Shareholder's Share of Current Year Income, (Form 1120S) For calendar year 2006,or tax Deductions Credits, and Other Items Department of the Treasury year beginning ,2006 1 Ordinary business income(loss) 13 Credits Internal Revenue service ending —47, 684 Shareholder's Share of Income, Deductions, 2 Net rental real estate income(loss) Credits, etc. - See page 2 of form and separate instructions. 3 Other net rental income(loss) -------------- Partl Information About the Corporation 4 Interest income - -------------- A Corporation's employer identification number — -------------- 25-1847000 5 a Ordinary dividends B Corporation's name,address,city,state,and ZIP code PC & Network Associates, Inc. 5 b Qualified dividends 14 Foreign transactions PCNAI — --- ------ 18 North Hanover Street 6 Royalties Carlisle, PA 17103 — ------- -- 7 Net short-term capital gain(loss) C IRS Center where corporation filed return — -------------- Cincinnati, OH 45999-0013 8a Net long-term capital gain (loss) D Tax shelter registration number,if any E Check if Form 8271 is attached 8 b Collectibles(28%)gain(loss) Part 11 Information About the Shareholder 8 c Unrecaptured section 1250 gain -------------- F Shareholder's identifying number 9 Net section 1231 gain(lass) G Shareholder's name,address, city,state, and ZIP code 10 Other income(loss) 15 Alternative minimum tax(AMT)items Richard W. Powell A —6, 334 . 686 Front Street — --------------- — -------------- Pinola, PA 17025 — --------------- — -------------- H Shareholder's percentage of stock ownership for tax year. . . . . . . . . . 100 . 00000 °s 11 Section 179 deduction 16 Items affecting shareholder basis C_ ____------ 272. 12 Other deductions A 245. E 3,212 . F — --------------- — -- O R --- --------------- --- -------------- I R — ——————————————— — -------------- S U _ S 17 Other information E --- --------------- --- -------------- O N L --- --------------- --- -------------- Y `See attached statement for additional information. BAA For Privacy Act and Paperwork Reduction Act Notice,see Instructions for Form 11205. Schedule K-1 (Form 1120S)2006 SPSA0412 06/28106 Schedule K-1 (Form 1120S)2006 PC & Network Associates, Inc. 25-1847000 Paget 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-1 and the instructions for your income tax return. Code Report on research activities 1 Ordinary business income(loss You must first determine whether the income L Credit for increasing See the Shareholder's (loss)is passive or nonpassive.Then enter on your return as follows: M New markets credit Instructions Report on N Credit for employer social security and Medicare taxes _ Passive loss See the Shareholder's Instructions O Backup withholding Form 1040,line 64 Passive income Schedule E,line 28,column(g) P Other credits See the Shareholder's Instructions Nonpassive loss Schedule E,line 28,column(h) 14 Foreign transactions Nonpassive income Schedule E,line 28,column 0) A Name of country or U.S.possession 2 Net rental real estate income(loss) See the Shareholder's Instructions 3 Other net rental income(loss) B Grass income from all sources Farm 1116,Part I Net income Schedule E,line 28,column(g) C Grass income sourced at shareholder level _ Net loss See the Shareholders Instructions Foreign gross income sourced at corporate level 4 Interest income Form 1040,line Be D Passive 5 a Ordinary dividends Form 1040,line 9a E Listed categories Form 1116,Part 1 5 b Qualified dividends Form 1040,line 9b F General limitation T 6 Royalties Schedule E,fine 4 Deductions allocated and apportioned at shareholder level 7 Net short-term capital gain(loss) Schedule D,line 5,column(f) O Interest expense Form 1116,Part 1 6 a Net long-term capital gain(loss) Schedule D,line 12,column(1) H Other Form 1116,Part 1 6 b Collectibles(28%)gain(loss) 28%Rate Gain Worksheet,line 4 Deductions allocated and apportioned at corporate level to (Schedule D instructions) foreign source income 6 C Unrecaptured section 1250 gain See the Shareholder's Instructions I Passive 9 Net section 1231 gain(loss) See the Shareholder's Instructions J Listed categories I— Form 1116,Part I 10 Other income(loss) K General limitation _ Code Other information A Other portfolio income(lass) See the Shareholders Instructions L Total foreign taxes paid Form 1116,Part II B Involuntary conversions See the Shareholders Instructions M Total foreign taxes accrued Farm 1116.Part II C Section 1256 contracts and straddles Form 6781,line 1 N Reduction in taxes available for credit Farm 1116,line 12 D Mining exploration costs recapture See Pub 535 O Foreign trading gross receipts Farm 8873 E Other income(loss) See the Shareholders Instructions P Extraterritorial income exclusion Form 8873 11 Section 179 deduction See the Shareholders Instructions Q Other foreign transactions See the Shareholder's Instructions 12 Other deductions 15 Alternative minimum tax(AMT)Items A Cash contributions(50%) — A Post-1986 depreciation adjustment B Cash contributions(30%) B Adjusted gain or loss C Noncash contributions(50%) See the Shareholders C Depletion(other then oil&gas) See the Shareholder's D Noncash contributions(30%) Instructions D Oil,gas,&geothermal—gross income Instructions and the Instructions for Form 6251 E Capital gain property to a 50% E Oil,gas,8 geothermal—deductions organization(30%) F Other AMT items — F Capital gain property(20%) — 16 Items affecting shareholder basis G Investment interest expense Form 4952,line 1 A Tax-exempt interest income Form 1040,line Bb H Deductions—royalty income Schedule E,line 18 B Other tax-exempt expenses I Section 59(o)(2)expenditures Seethe Shareholder's Instructions C Nondeductible expenses See the Shareholder's J Deductions—portfolio(2%floor) Schedule A,line 22 Instmce Sh D Property distributions an K Deductions—portfolio(other) Schedule A.line 27 E Repayment of loans from shareholders — L Preprotluctive period expenses Sae the Shareholder's Instructions 17 Other Information M Commercial revitalization deduction from A Investment income Form 4952,line 4a rental real estate activities See Form 8582 Instructions B Investment expenses Form 4952,line 5 N Reforestation expense deduction See the Shareholder's Instructions C Qualified rehabilitation expenditures O Domestic production activities information See Farm 8903 Instructions (other than rental real estate) See the Shareholder's Instructions P Qualified production activities income Form 8903,line 7 D Basis of energy property See the Shareholder's Instructions Q Employer's W-2 wages Form 8903,line 13 E Recapture of low-income housing credit R Other deductions See the Shareholders Instructions (section 420)(5)) Farm 8611,line 8 13 Credits F Recapture of low-income housing credit _ (other) Form 8611,line 8 A Low-income housing credit(section 420)(5)) G Recapture of investment credit See Form 4255 B Low-income housing credit(other) H Recapture of other credits See the Shareholders Instructions C Qualified rehabilitation expenditures See the Shareholder's (rental real estate) Instructions I Look-back interest—completed long-term contracts See Form 8697 J Look-back interest—income forecast method See Form 8866 D Other rental real estate credits — K Dispositions of property with section 179 deductions E Otherrenlal credits L Recapture of section 779 deduction F Undistributed capital gains credit Form 1040,line 70,check box a M Section 453(1 G Credit for alcohol used as fuel )(3)information N Section 453A(c)information H Work opportunity credit See the Shareholder's Seethe Welfare-to-work credit Instructions O Section 1260(b)information Shareholder's P Interest allocable to production expenditures Instructions J Disabled access credit — Q CCF nonqualifetl withdrawals K Empowerment zone and renewal R Information needed to figure depletion—oil and gas community employment credit Form 8844,line 3 $ Amortization of reforestation costs T Other information _ SPSA0412 06/28106 Schedule K-1 (Form 1120S)2006 PC&Network Associates, Inc. 25-1847000 1 Form 1120S, Page 1, Line 19 Other Deductions Accounting 990. Bank charges 1, 617 . Discounts 5, 596. Dues and subscriptions 3, 749. Legal and professional 4, 074 . Meals and entertainment (50%) 272 . Office expense 4, 086. Outside services/independent contractors 9, 630 . Postage 2, 110 . Printing 766. Supplies 2, 016. Telephone 8, 610 . Travel 15, 730 . Web Hosting Fees 654 . Trade Publications/Books 841 . Total 60, 741 . Other Current Liabilities: 1120S, Schedule L, Line 18 Beginning of End of Other Current Liabilities: tax year tax year Sales tax Owed 853. 1, 088. Total 853. 1, 088. Rev-0508 EX-(11-10) SCHEDULE E pennsylvania CASH, BANK DEPOSITS, & MISC. DEPARTMENT OF REVENUE INHERITANCE TAX RETURN PERSONAL PROPERTY RESIDENT DECEDENT ESTATE OF FILE NUMBER Powell, Richard Wayne 21-10-00692 Include the proceeds of litigation and the date the proceeds were received by the estate. All property jointly-owned with the right of survivorship must be disclosed on schedule F. ITEM VALUE AT DATE NUMBER DESCRIPTION OF DEATH 1 PSECU Checking Account-Interest 5,759.02 Accrued interest on Item 1 through date of death 0.12 2 PSECU Savings Account 99.05 Accrued interest on Item 2 through date of death 0.02 3 1999 Jeep Wrangler Sport Utility 2D-Value per sale 8,000.00 4 2006 Chevy Malibu LT Sedan -Value per sale 8,000.00 5 Personal Property& Household Furnishings -Value per sale 4,341.65 6 AAA-Membership refund 27.44 7 AMA Insurance Agency- Premium refund 43.11 8 AmeriGas -Refund 94.05 9 Erie Insurance Group-Vehicle Insurance Refund 354.00 10 Gurney's Seed&Nursery Company-Refund 23.45 11 PayPal -Credit deposit 0.11 12 PayPal -Credit deposit 0.08 13 PayPal -Refund of account balance 180.07 14 United States Treasury-2008 Income Tax Refund 889.50 Total of Continuation Schedule See attached page TOTAL(Also enter on Line 5, Recapitulation) 27,870.40 (If more space is needed,additional pages of the same size) Copyright(c)2010 form software only The Lackner Group, Inc. Form PA-1500 Schedule E(Rev. 11-10) Rev-1508 EXa 11110) SCHEDULE E Pennsylvania CASH, BANK DEPOSITS, & MISC. DEPARTMENT OF REVENUE INHERITANCE TAX RETURN PERSONAL PROPERTY RESIDENT DECEDENT continued ESTATE OF FILE NUMBER Powell, Richard Wayne 21-10-00692 ITEM VALUE AT DATE DESCRIPTION NUMBER OF DEATH 15 United States Treasury-2009 Income Tax Refund 58.73 TOTAL(Also enter on Line S. Recapitulation) 27,870.40 Copyright(c)2010 form software only The Lackner Group, Inc. Forth PA-1500 Schedule E(Rev. 11-10) REV-1511 EX.(10-09) pennsylvania SCHEDULE H DEPARTMENT OF REVENUE FUNERAL EXPENSES AND INHERITANCE DECEDENT ADMINISTRATIVE COSTS RESIDENT DECEDENT ESTATE OF FILE NUMBER Powell, Richard Wayne 21-10-00692 Decedent's debts must be reported on Schedule 1. ITEM DESCRIPTION AMOUNT NUMBER A. FUNERAL EXPENSES: See continuation schedule(s) attached 5,101.42 B. ADMINISTRATIVE COSTS: 1. Personal Representative's Commissions Name of Personal Representative(s) Michael W. Powell Street Address 1166 Young Rd. city Punxsutawney State PA zio 15767 Year(s)Commission Paid 2013 17,000.00 2. Attorney's Fees Smigel, Anderson & Sacks, LLP 34,094.09 3. Family Exemption: (If decedent's address is not the same as claimant's,attach explanation) Claimant Street Address City State Zio Relationshio of Claimant to Decedent 4. Probate Fees 427.50 5. Accountant's Fees 6. Tax Return Preparer's Fees Monique Ericson, CPA&Tracey Douty, CPA 8,556.25 7. Other Administrative Costs 16,844.66 See continuation schedule(s) attached TOTAL(Also enter on line 9, Recapitulation) 82,023.92 Copyright(c)2009 form software only The Lackner Group,Inc. Form PA-1500 Schedule H (Rev. 10-09) SCHEDULE H FUNERAL EXPENSES AND ADMINISTRATIVE COSTS continued ESTATE OF FILE NUMBER Powell, Richard Wayne 21-10-00692 ITEM NUMBER DESCRIPTION AMOUNT Funeral Expenses 1 Brenda Shumaker Funeral Home, Inc. -Funeral Bill 4,065.43 2 Melinda Powell -Reimburse-funeral clothes and thank you notes 105.99 3 R.D. Brown Memorials-Gravestone 930.00 H-A 5,101.42 Other Administrative Costs 4 Bank of America -Phone payment fee 20.00 5 Bonnie Mehaffie-Title Search 40.00 6 Bonnie Mehaffie-Title Search 40.00 7 Cumberland County Tax Claims -2010 Co/Twp taxes 655.30 8 Cumberland Law Journal-Legal Ad 75.00 9 D.A. Potts -Appraisal Fee 325.00 10 Debbie Lupold,Treasurer-2010-11 School Real Estate Taxes 1.849.13 11 Debbie Lupold,Treasurer-2011 Co/Twp Taxes 597.70 12 Debbie Lupold, Treasurer-2011/12 School Taxes 1,916.16 13 Department of State-Dissolution Fee-ALP Solutions, LLC 70.00 14 DJ Maintenance-Fee for winterizing real estate 159.00 Copyright(c)2002 form software only The Lackner Group, Inc. Form PA-1500 Schedule H (Rev. 6-98) SCHEDULE H FUNERAL EXPENSES AND ADMINISTRATIVE COSTS continued ESTATE OF FILE NUMBER Powell, Richard Wayne 21-10-00692 ITEM NUMBER DESCRIPTION AMOUNT 15 DJ Maintenance-Lawn maintenance 165.00 16 DJ Maintenance-Lawn maintenance 466.40 17 DJ Maintenance-Lawn Maintenance 583.00 18 DJ Maintenance-Lawn Maintenance 233.20 19 DJ Maintenance-Lawn Maintenance 116.60 20 East Pennsboro Township-Sewer/Trash bill 3rd Qtr 2010 126.50 21 East Pennsboro Township-Sewer/Trash 4th Qtr 2010 126.50 22 East Pennsboro Township-Trash/Sewer bill 1st Qtr 2011 138.00 23 East Pennsboro Township-Sewer/Trash 2nd Qtr 2011 138.00 24 East Pennsboro Township-Sewer/Trash 3rd Qtr 2011 138.00 25 East Pennsboro Township-Sewer/Trash 4th Qtr 2011 138.00 26 East Pennsboro Township-Sewer/Trash 1st Qtr 2012 138.00 27 East Pennsboro Township-Sewer/Trash 2nd&3rd Qtr. 2012 196.80 28 East Pennsboro Township-Sewer 4th Qtr 2012 91.50 29 East Pennsboro Township-Sewer 1st Qtr 2013 100.65 30 Michael Powell-Reimburse-Postage 57.39 31 Michael Powell -Postage 18.78 Copyright(c)2002 form software only The Lackner Group, Inc. Form PA-1500 Schedule H(Rev.6-98) SCHEDULE H FUNERAL EXPENSES AND ADMINISTRATIVE COSTS continued ESTATE OF FILE NUMBER Powell, Richard Wayne 21-10-00692 ITEM NUMBER DESCRIPTION AMOUNT 32 Michael Powell-Gas 112.00 33 Michael Powell -Reimbursement for payment of Auto Ins. premium 678.00 34 Michael Powell -Postage 52.60 35 Michael Powell -Reimburse hotelfgas 121.51 36 PP&L-Electric Bill 614.91 37 PP&L-Electric Bill 2,248.07 38 PP&L-Electric Bill 227.53 39 PP&L-Electric Bill 103.80 40 PP&L-Electric Bill 179.66 r 41 PP&L-Electric bill 38.65 42 PP&L-Electric Bill 96.79 43 PP&L-Electric Bill 10.73 44 PP&L-Electric Bill 26.62 45 PP&L-Electric Bill 13.23 46 PP&L-Electric Bill 12.47 47 PP&L-Electric Bill 12.71 48 PP&L-Electric Bill 10.53 Copyright(c)2002 form software only The Lackner Group, Inc. Form PA-1500 Schedule H (Rev. 6-98) SCHEDULE H FUNERAL EXPENSES AND ADMINISTRATIVE COSTS continued ESTATE OF FILE NUMBER Powell, Richard Wayne 21-10-00692 ITEM NUMBER DESCRIPTION AMOUNT 49 PP&L-Electric Bill 8.95 50 PP&L-Electric Bill 8.95 51 PP&L-Electric Bill 8.72 52 PP&L-Final Electric Bill 38.79 53 PP&L-Electric Bill 13.49 54 Residence Inn -Hotel Accomodations for family while at hospital 143.16 55 S. Brian Magaro-Commission -sale of personalty 396.00 56 Sadler Oil Company-Oil bill 250.15 57 Sadler Oil Company-Oil Bill 249.90 58 Sadler Oil Company-Oil Bill 290.19 59 Sadler Oil Company-Final Oil Bill 465.16 60 State Farm Insurance-Homeowners Insurance Premium 667.00 61 State Farm Insurance-Homeowner's Insurance Premium 801.00 62 Suntrust Bank-Speedpay fee 15.00 63 The Sentinel -Legal Ad 208.78 H-137 16,844.66 Copyright(c)2002 form software only The Lackner Group, Inc. Form PA-1500 Schedule H(Rev.6-98) Rev-1512 EX.(12-08) SCHEDULE 1 pennsylvania DEBTS OF DECEDENT, DEPARTMENT OF REVENUE INHERITANCE TAX RETURN MORTGAGE LIABILITIES AND LIENS RESIDENT DECEDENT ESTATE OF FILE NUMBER Powell, Richard Wayne 21-10-00692 Report debts incurred by the decedent prior to death that remained unpaid at the date of death,including unreimbursed medical expenses. ITEM VALUE AT DATE NUMBER DESCRIPTION OF DEATH 1 Advanta Credit Card -Acct. No. XXXXXXXXXX9012 17,192.08 2 American Express Credit Card -Acct. No. 371533900582009 5,507.81 3 American Express Credit Card -Acct. No.371540808541003 22,548.95 4 Bank of America Credit Cart-Acct. No. 5474970000983643 4,459.36 5 Bank of America Mortgage-Acct No.041449831 92,957.15 6 Capital One Credit Card-Acct. No.4802132634597630 17,420.99 7 Capital One Credit Card-Acct. No.4802131763084600 9.350.14 8 Capital One Loan-No. 00572646175451 31,136.49 9 Capital One Mastercard-Acct No. 5291491907085623 275.51 10 Capital One Visa-Acct. No.4305721518100230 11,230.19 11 Chase Bank Credit Card -Acct. No.4246311201387807 10,136.31 12 Chase Visa -Acct No.4640182026910400 5,855.08 13 Citi Mastercard-Acct. No. 5424180473127733 15.308.42 14 Comcast-Acct No.09547187303-01-5 59.27 15 Discover -Acct. No.6011208925802293 8,877.69 16 Discover -Acct No.xxxxxxxx8710 5.582.20 17 Eleanor Kish- E-bay Commissions 76.82 Total of Continuation Schedule See attached page TOTAL(Also enter on Line 10, Recapitulation) 436,031.65 (If more space is needed,additional pages of the same size) Copyright(c)2008 form software only The Lackner Group, Inc. Form PA-1500 Schedule 1(Rev. 12-08) Rev-0512 EX+(1208) SCHEDULE I pennsylvania DEBTS OF DECEDENT, DEPARTMENT OF REVENUE INHERITANCE TAX RETURN MORTGAGE LIABILITIES AND LIENS RESIDENT DECEDENT continued ESTATE OF FILE NUMBER Powell, Richard Wayne 21-10-00692 ITEM VALUE AT DATE NUMBER DESCRIPTION OF DEATH 18 PA Department of Revenue-2007 Tax due 135.00 19 PA Department of Revenue-2008 Tax due 1.749.00 20 PA Department of Revenue-2009 Tax Due 1,672.00 21 PA Department of Revenue-2009 Additional tax due 112.00 22 Pinnacle Health -Medical Bill DOS 4/09110 1,487.30 23 PNC HELOC -Acct No.4003048110401209 31,291.63 24 PNC Mortgage-Acct. No.602482308 80,059.16 25 PNC Mortgage-Acct. No.604040236 40,623.71 26 PSECU Personal Service Loan-Final Loan payment 125.68 27 PSECU Visa Loan 11,659.40 28 Suntrust Bank-Payoff Chevy Malibu 5.133.41 29 U.S. Department of Veteran Affairs-Co-payments due 508.02 30 United States Treasury-2008 Tax due 2,926.00 31 Verizon-Acct. No.717732-676150826Y 378.56 32 Verizon-Business land line 31.38 33 Verizon Wireless-Acct. No. 721875286-00001 164.94 TOTAL(Also enter on Line 10, Recapitulation) 436,031.65 Copyright(c)2008 form software only The Lackner Group,Inc. Form PA-1500 Schedule I(Rev. 12-08) REV-1517 EX.(01-10) pennsylvania SCHEDULE J DEPARTMENT OF REVENUE INHERITANCE TAX RETURN BENEFICIARIES RESIDENT DECEDENT ESTATE OF FILE NUMBER Powell, Richard Wayne 21-10-00692 NAME AND ADDRESS OF RELATIONSHIP TO SHARE OF ESTATE AMOUNT OF ESTATE NUMBER PERSON(S)RECEIVING PROPERTY DECEDENT (Words) ($$$) I TAXABLE DISTRIBUTIONS [include outright spousal distributions,and transfers under Sec.9116(a)(1.2)] Alexandra L. Powell Daughter One Hundred 4020 Wilke Drive Percent Lower Burrell, PA 15068 Total Enter dollar amounts for distributions shown above on lines 15 through 18 on Rev 1500 cover sheet,as appropriate. NON-TAXABLE DISTRIBUTIONS: II. A.SPOUSAL DISTRIBUTIONS UNDER SECTION 9113 FOR WHICH AN ELECTION TO TAX IS NOT TAKEN B.CHARITABLE AND GOVERNMENTAL DISTRIBUTIONS TOTAL OF PART II -ENTER TOTAL NON-TAXABLE DISTRIBUTIONS ON LINE 13 OF REV-1500 COVER SHEET Copyright(c)2010 form software only The Lackner Group, Inc. Form PA-1500 Schedule J(Rev. 01-10) REGISTER OF WILLS CERTIFICATE OF CUMBERLAND COUNTY GRANT OF LETTERS PENNSYLVANIA 0 No. 2010- 00692 PA No. 21- 10- 0692 Estate Of: RICHARD WAYNEPOWELL (Fap MWM,Last Late Of: EAST PENNSBORO TOWNSHIP CUMBERLAND COUNTY Deceased Social Security No: WHEREAS, on the 9th day of July 2010 an 'instrument dated May 5th 2004 was admitted to probate as the last will of RICHARD WAYNEPOWELL (First,Middle,Last late of EAST PENNSBORO TOWNSHIP, CUMBERLAND County, who died on the 14th day of June 2010 and, WHEREAS, a true copy of the will as probated is annexed hereto. THEREFORE, I, GLENDA FARNER STRASBAUGH , Register of Wills in and for CUMBERLAND County, in the Commonwealth of Pennsylvania, hereby certify that I have this day granted Letters TESTAMENTARYto: MICHAEL W POWELL who has duly qualified as EXECUTOR(RIX) j and has agreed to administer the estate according to law, all of which fully appears of record in my office at CUMBERLAND COUNTY COURTHOUSE, CARLISLE, PENNSYLVANIA. IN TESTIMONY WHEREOF, I have hereunto set my hand and affixed the seal of my office on the 9th day of July 2010. {o/�f�(Wills .. add/-61:C�`4DePut' y - **NOTE** ALL NAMES ABOVE APPEAR (FIRST, MIDDLE, LAST) _. ..........,v.. w.re>ruw� )rM 1 , N c_J CiJ'i. LAST WILL AND TESTAMENT --U,a OF RICHARD W. POWELL I, RICHARD W. POWELL, presently of Cumberland County, Pennsylvania, declare this to be my Last Will and Testament hereby revoking all Wills and Codicils previously made by me. MARITAL STATUS I declare that I am divorced from LEAANN POWELL. CHILDREN I have one (1) child, now living, whose name and date of birth are as follows: ALEXANDRA L. POWELL bom July 11, 1996 I have one (1) adopted child, now living, whose name and date of birth are as follows: RACHELLE LYNNE HOUSEHOLDER bom September 13, 1982 All references in this Will to my child include only ALEXANDRA L. POWELL DISPOSITION OF BODY ARTICLE I I direct that my body be cremated and the ashes disposed of as my Executor.shall determine. DISINHERITANCE ARTICLE II It is my specific intent, by the terms of this Will, to disinherit my daughter, RACHELLE LYNNE HOUSEHOLDER, from any interest in my Estate, and no provision to this Will shall. be construed contrary to that expressed intent. PERSONAL PROPERTY ARTICLE III I give all of my household furnishings and tangible personal property to my daughter, ALEXANDRA L. POWELL, per stirpes, such that any issue shall represent and take their deceased parent's share. If my daughter, ALEXANDRA L. POWELL, is a minor at that time, then said property and furnishings which my Executor considers unsuitable for my child may be sold and the proceeds added to my residuary estate. RESIDUE ARTICLE IV I give the rest, residue and remainder of my estate to my brother, MICHAEL W. POWELL, presently of Punxsutawney, Pennsylvania, as Trustee, in Trust, for the benefit of my child to be held, administered and distributed in accordance with the provisions of Article V herein. Page 2 of 16 Pages . .. . . . .,- v L r..... ` r�'ar8.'� tai � <4'� .i/Y n+' r . ��'iMtiF.`•�:"aC A Should my daughter, ALEXANDRA L. POWELL, predecease me, then I direct that the rest, residue and remainder of my estate be distributed as follows: A. One-third(1/3) to my parents, CLARENCE W. POWELL and SHIRLEY M. POWELL, presently of Timblin, Pennsylvania, perstirpes, such that any :sue shall represent and take their deceased parent's share. B. One-third(1/3) to my brother, MICHAEL W. POWELL, provided he survives me by thirty(30) days. If my brother, MICHAEL W. POWELL, fails to survive me by thirty(30) days, then his one-third share shall be distributed to my brother, RANDY L. POWELL, to be held as custodian for the benefit of my niece, SHEALYNN M. POWEi.1 ., s.ntly of Punxsutawney, Pennsylvania, under the Pennsylvania Uniform Transfers to Minors Act to be held until she attains the.age of twenty-five (25). C. One-third(1/3) to my brother, RANDY L. POWELL,presently of Punxsutawney, Pennsylvania,provided he survives me by thirty(30) days. If my brother, RANDY L. POWELL, fails to survive me by thirty(30) days, then his one-third share shall pass to his wife, MELINDA J. POWELL, presently of Punxsutawney, Pennsylvania. TRUST ARTICLE V The Trust established under Article N shall be held, administered and distributed as follows: A. Intent. It is my hope that this Trust will not distort the core values that I have cherished and instilled in my daughter, ALEXANDRA L. POWELL. It is my hope that she will use her skills and hard work to accomplish her goals and dreams and to seek gainful employment for her support,maintenance and happiness. B. Needs. The net income of the Trust shall be paid to or applied for the benefit of my child at such times and in such amounts as my Trustee shall deem Page 3 of 16 Pages i necessary for her proper support, health, maintenance and education. It is my intent that this Trust shall supplement, not supplant, other sources of care for ALEXANDRA L. POWELL should she become disabled. "Education" shall include, but not be limited to, any public or private primary, secondary, trade or technical school, college, post-graduate or any other course of study at any accredited institution of my child's choice for any period of time that, in the judgment of the Trustee, is advantageous to my child and shall include reasonable amounts for all related living and travel expenses of my child. Should the income be insufficient to provide my child with adequate support, health, maintenance or education, the Trustee may invade the principal of the Trust for these purposes. The Trustee shall accumulate and add to principal any net income not distributed to my child during the year. C. Guardian's Expenses. In making the aforesaid payments for the support, health, maintenance and education of my child, the Trustee shall give a liberal interpretation to the discretionary authority conferred by this Will so as to alleviate the burden on the guardian of the person of my child and on the guardian's family that might be caused in any way by the presence of my child in the guardian's home. The Trustee shall verify that distributions made pursuant to this subparagraph C have been utilized to alleviate the burden on the Guardian or his family and not to unjustly enrich the Guardian or the Guardian's family. D. Discretionary Authority. The Trustee in exercising his discretionary authority with respect to the payment of income or principal of the Trust estate shall take Page 4 of 16 Pages into consideration any income or other resources available to my child from sources outside of this Trust that may be known to the Trustee, including federal or state public assistance benefits, the desirability of a transaction, and the reasonably anticipated needs and resources of my child. The Trustee may accept as final and conclusive the written statement of my child as to other available income or resources. The determination of the Trustee with respect to the necessity of making payments out of income or principal to my child shall be conclusive on all persons however interested in the Trust. E. Distribution. On a date three (3) months following my child's graduation from a four-year technical school, college or university, my child shall have the right to withdraw fifty(50%) of the remaining principal of the Trust. Upon reaching the age of thirty-five(35) years, my child shall have the option to withdraw up to fifty(50%) percent of the remaining principal of the Trust, and the remaining balance shall be placed directly into one (1) or more qualified or non-qualified retirement plans of her choice with the advice and consent of the Trustee. TRUST POWERS ARTICLE VI In order to carry out.the purposes of the Trust established by this Will, the Trustee, in addition to all other powers granted by this Will or by law, shall have the following powers over the Trust estate, subject to any limitations specified elsewhere in this Will: Page 5 of 16 Pages A. Investments. To invest in, accept and retain any real or personal property, including stock of a corporate fiduciary or its holding company, without restriction to legal investments; . B. Sale. To sell, exchange, partition or lease for any period of time any real or personal property and to give options therefor for cash or credit, with or without security; C. Borrowing and Encumbering. To borrow money from any person including any fiduciary acting hereunder, and to mortgage or pledge any real or personal property; D. Form of Ownership of Trust Property. To hold shares of stock or other securities in nominee registration form, including that of a clearing corporation or depository, or in book entry form or unregistered or in such other form as will pass by delivery; E. Litigation. To engage in litigation and compromise, arbitrate or abandon claims; F. Tax Returns. To make elections, decisions, concessions and settlements in connection with all income, estate, inheritance, gift or other tax returns and the payment of such taxes; G. Retention of Property. To retain any property received by the Trust for so long as the Trustee considers it advisable; Page 6 of 16 Pages H. Investment Decisions. To invest and reinvest in every kind of property and investment which persons of prudence, discretion and intelligence acquire for their own accounts; I. Property Management. To manage, control, repair and improve all personal and real property; J. Business Interests. To continue and operate, to sell or to liquidate, as the Trustee deems advisable at the risk of the trust estate, any business or partnership interests received by the trust estate and to organize a partnership or corporation to carry on such business. K. Insurance. To procure and carry at the expense of the Trust, insurance of the kinds, forms and amounts deemed advisable by the Trustee to protect the Trust and the Trustee against any hazard; L. Employment of Attorneys,Advisers and Other Agents. To employ any attorney, investment adviser, accountant, broker, tax specialist or any other agent deemed necessary in the discretion of the Trustee; and to pay from the Trust reasonable compensation for all services performed by any of them; M. General. To do all the acts, to take all the proceedings, and to exercise all the rights, powers and privileges which an absolute owner of the property would have, subject always to the discharge of his fiduciary obligations. The enumeration of certain powers in this Will shall not limit the general or implied powers of the Trustee. The Trustee shall have all additional powers that may now or hereafter be conferred on the Page 7 of 16 Pages Trustee by law or that may be necessary to enable the Trustee to administer the Trust in accordance with the provisions of this Will. TRUST ADMINISTRATION ARTICLE VII A. Compensation. The Trustee shall receive a reasonable fee for the ordinary and extraordinary services rendered by him. B. Death. On the death of my child, the Trustee shall pay the expense of the last illness, funeral and burial of my child out of the principal of her Trust, unless the Trustee in his discretion determines that other provisions have been made for the payment of such expense. C. Termination. All of the trusts provided for herein shall in any event terminate on the death of the last survivor of all of my issue living at the time of my death. However, the Trustee shall be permitted to terminate the Trust herein if its fair market value declines or is of such size which makes the continuance of the Trust uneconomical, imprudent and unwise. Upon such termination, the Trustee shall distribute the principal and income to the beneficiary or beneficiaries as set forth in this Will, and the rights of 211 persons who might otherwise have an interest as a successor income or principal beneficiary shall cease. Page 8 of 16 Pages D. Survivorship. Should my child die prior to termination of the Trust, the Trustee shall, after payment of any funeral and burial expenses, distribute the balance of such child's share of the Trust estate as follows: 1. Twenty-five (25%)percent to my parents, CLARENCE W. POWELL and SHIRLEY M. POWELL, per stirpes, such that any issue shall represent and take their deceased parent's share. 2. Twenty-five(25%) percent to my brother, MICHAEL W. POWELL, provided he survives me by thirty(30) days. If my brother, MICHAEL W. POWELL, fails to survive me by thirty(30) days, then his one- third share shall be distributed to my brother, RANDY L. POWELL, to be held as custodian for the benefit of my niece, SHEA-LYNN M. POWELL, under the Pennsylvania Uniform Transfers to Minors Act to be held until she attains the age of twenty-five(25). 3. Twenty-five(25%) percent to my brother, RANDY L. POWELL, provided he survives me by thirty(30) days. If my brother, RANDY L. POWELL, fails to survive me by thirty(30) days, then his one-third share shall pass to his wife, MELINDA J. POWELL. 4. Twenty-five (25%) percent to the issue of my daughter, ALEXANDRA L. POWELL. If my daughter, ALEXANDRA L. POWELL, leaves no surviving issue, then I direct that her twenty-five (25%) percent be distributed equally among my parents, CLARENCE W. POWELL and SHIRLEY M. POWELL, or to the survivor of them; my brother; MICHAEL W. POWELL, and my brother, RANDY L. POWELL, as set forth above. E. Immediate Distribution. If on termination of the administration of my probate estate, there has been no distribution in trust to the Trustee and events have occurred which would require the Trustee under the terms of this Will to make immediate distribution of all the property, my Executor shall perform all of the acts necessary to complete such distribution and for this purpose shall have the powers granted by this Will to the Trustee. Page 9 of 16 Pages F. Determinations. The determination and/or payment for the needs of the Trust beneficiaries shall be made by the Trustee on a regular basis which, in no event, shall be less than quarterly. G. Alternative Payments. If at any time my child is entitled to receive income or principal from the Trust estate and is a minor or an incompetent or a person, whom the Trustee deems unable to handle the funds properly or wisely if paid directly to the child, the Trustee in his discretion may make payments in any one or more of the following ways: 1. To the natural guardian or legally appointed guardian of the person or estate of the child; 2. By making expenditures directly for the support, health,maintenance, or education of the child; or. 3. To any person or organization furnishing support, health, maintenance, or education for the child. The Trustee shall not be required to see to the application of any funds paid or applied in any of the aforementioned ways and the receipt of the payee shall be full acquittance to the Trustee. The decision of the Trustee as to which of the aforementioned methods should be used-in making payments shall be conclusive and binding on all parties concerned. H. Bond. The Trustee shall not be required to give bond or other security for the faithful performance of his duties. I. Determination of Income. The Trustee shall determine what is income and what is principal of the Trust established under this Will and what expenses, costs Page 10 of 16 Pages 1 and taxes shall be charged against income and what shall be charged against principal in accordance with the applicable laws of the Commonwealth of Pennsylvania as they now ' exist and may from time to time be enacted or repealed. J. Applicable Law. The validity and administration of the Trust established under this Will and all questions relating to the construction or interpretation of the Trust shall be governed by the laws of the Commonwealth of Pennsylvania. ALTERNATE TRUSTEE ARTICLE VIII In the event of the death, resignation, renunciation or inability to act of MICHAEL W. POWELL as the Trustee, then I appoint my brother, RANDY L. POWELL, in his place and stead with the same powers, rights, discretions, obligations and immunities. GUARDIAN ARTICLE IX A. Appointment. In the event that my child's mother shall predecease me or die simultaneously with me, then I nominate and appoint as testamentary guardian of the estate and person of my minor child, my brother, RANDY L. POWELL, to serve as said guardian. If my brother, RANDY L. POWELL, is unable or unwilling to serve as said guardian, then I nominate and appoint as testamentary guardian of the estate and person of my minor child, my brother, MICHAEL W. POWELL, to serve as said guardian. Page 11 of 16 Pages r I, B. Bond. No bond or other security shall be required of any guardian appointed in this Will. C. Compensation. The guardian shall receive a reasonable fee for the ordinary and extraordinary services rendered by him. EXECUTOR ARTICLE X A. Appointment. I appoint my brother, MICHAEL W. POWELL, as the Executor of this Will. In the event of his death, resignation,renunciation or inability to act in that capacity, then I appoint my brother, RANDY L. POWELL, as the Executor of this Will in his place and stead. B. Bond. No bond or other security shall be required of any Executor appointed in this Will. C. Compensation. The Executor shall receive reasonable compensation for his services performed as determined by the Court in which this Will is admitted to probate. EXECUTOR POWERS ARTICLE XI I give my Executor in addition to and not in limitation of the powers given by law or by other provisions of this Will, the same powers granted my Trustee under Article VI with respect Page 12 of 16 Pages C �i fto administration of the Trust, to be exercised in the discretion of my Executor with respect to settlement of my Estate without further order or license of the Register,of.Wills or of any Court. I I NO ALIENATION 1 ARTICLE XII No interest of any beneficiary under this Will or any codicil hereto shall be subject to anticipation or voluntary or involuntary alienation. I i NO CONTEST ARTICLE XIII If any beneficiary or remainderman under this Will in any manner, directly or indirectly, contests or attacks this Will or any of its provisions, any share or interest in my estate or in the estate of the Trust given to that contesting beneficiary or remainderman under this Will is revoked and shall be disposed of in the same manner provided herein as if that contesting beneficiary or remainderman had predeceased me without issue. LEGALITY OF ARTICLES ARTICLE XIV If any provision of this Will or of any codicil thereto is held to be inoperative, invalid or illegal, it is my intention that all of the remaining provisions thereof shall continue to be fully operative and effective so far as it is possible and reasonable. Page 13 of 16 Pages is r TAXES ARTICLE XV All estate, inheritance and succession taxes, together with any interest and penalties thereon, payable as a result of my death and imposed with respect to any property, whether or not disposed of by this Will, shall be paid out of the residue of my estate. IN WITNESS WHEREOF, I have hereunto set my hand and seal and caused this my Last Will and Testament, consisting of sixteen (16) typewritten pages, including this attestation A clause, to be executed, declared and published this S day of 2004, at River Chase Office Center, 4431 North Front Street, Harrisburg, Pennsylvania. (SEAL) RICHARD W. POWELL Page 14 of 16 Pages Signed, sealed, published and declared by the above named RICHARD W. POWELL, Testator, as and for his Last Will, in the presence of us and each of us, who, at his request and in his presence and in the presence of each other, have hereunto subscribed qur names as witnesses thereto the day and year last above written. Residing at si65Q thoraQ!�At��/6 , Pty 11116 Residing at l!!//S C7 Residing at 56y, k).5y- r COMMONWEALTH OF PENNSYLVANIA COUNTY OF DAUPHIN SS. We, RICHARD W. POWELL, the Testator, an and "JC'%)j)i dr° &j (ythe witnesses, whose names are signed to the attached or foregoing instrument, being first duly sworn, do hereby declare to the undersigned authority that the Testator signed and executed the instrument as his Last Will; that the Testator signed willingly and executed it as his free and voluntary act for the purposes therein expressed; that each subscribing witness in the hearing and sight of the Testator signed the Will as a witness and that to the best of his or her knowledge the Testator was at that time eighteen (18Aears of age or olde , of son mind and under no constraint or undue influence. RICHARD W. POWELL Wit ness Witness Witness Subscribed, sworn to and acknowledged before me by RICHARD W. POWELL, the Testator, and subscribed and sworn to before me by and i t`; 1 )d 1, �'� w £#itnesses, this Lr day of 2004. Notary ub1P is ` �- My Commission Expires: No.ena� S"cal Ton S. Stoneroad Notary Public Susquehanna Avp., on ap County A1Y Commissirn Expires Nov. 29, 20Q1 Page 16 of 16 Pages -- ._._ ____ Mnmhpr,�'ennsyWaniags�ciati7o OtNotar?gs w x xH a a aOOOQQ O d bn w o o w w bn u E" � cFnU Afyi � � � U h % h w ., w