-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, PDyeOhrpJiGp+QW5miy4MJJRfSIIi8FVtv5X+VKLACyqpBXi0SQKgtSfpswTGgbo MJ5XVSz0MegcykZylez17Q== 0001144204-08-047145.txt : 20080814 0001144204-08-047145.hdr.sgml : 20080814 20080814151410 ACCESSION NUMBER: 0001144204-08-047145 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 8 CONFORMED PERIOD OF REPORT: 20080630 FILED AS OF DATE: 20080814 DATE AS OF CHANGE: 20080814 FILER: COMPANY DATA: COMPANY CONFORMED NAME: National Investment Managers Inc. CENTRAL INDEX KEY: 0000770461 STANDARD INDUSTRIAL CLASSIFICATION: INVESTMENT ADVICE [6282] IRS NUMBER: 592091510 STATE OF INCORPORATION: FL FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-51252 FILM NUMBER: 081018319 BUSINESS ADDRESS: STREET 1: 485 METRO PLACE SOUTH STREET 2: SUITE 275 CITY: DUBLIN STATE: OH ZIP: 43017 BUSINESS PHONE: 614-923-8822 MAIL ADDRESS: STREET 1: 485 METRO PLACE SOUTH STREET 2: SUITE 275 CITY: DUBLIN STATE: OH ZIP: 43017 FORMER COMPANY: FORMER CONFORMED NAME: FAST EDDIE RACING STABLES INC DATE OF NAME CHANGE: 19960820 10-Q 1 v123340_10q.htm

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE

ACT OF 1934

For the quarterly period ended June 30, 2008 OR

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES

EXCHANGE ACT OF 1934

For the transition period from _______ to ________

Commission file number 000-51252

NATIONAL INVESTMENT MANAGERS INC.

(Exact name of registrant as specified in its charter)

Florida	59-2091510
(State or other jurisdiction of	(I.R.S.Employer
incorporation or organization)	identification No.)

485 Metro Place South, Suite 275, Dublin, Ohio 43017

(Address of principal executive offices)

(614) 923-8822

(Registrant's telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes x No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See definition of “accelerated filer, large accelerated filer or smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer o Accelerated filer o Non-accelerated filer o Smaller Reporting Company x

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act)

Yes o No x

As of August 11, 2008, 37,158,748 shares of $.001 par value common stock of the registrant were outstanding.

Transitional Small Business Disclosure Format (check one): Yes o No x

NATIONAL INVESTMENT MANAGERS INC. AND SUBSIDIARIES

INDEX

		Page No.
PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

Condensed Consolidated Balance Sheets - June 30, 2008 (unaudited) and December 31, 2007 (audited)		3

Condensed Consolidated Statements of Operations - Six months ended June 30, 2008 and 2007 (unaudited)		4

Condensed Consolidated Statements of Operations – Three months ended June 30, 2008 and 2007 (unaudited)		5

Condensed Consolidated Statements of Cash Flows - Six months ended June 30, 2008 and 2007 (unaudited)		6

Notes to Condensed Consolidated Interim Financial Statements		8-19

Item 2. Management's Discussion and Analysis or Plan of Operations		20-28

Item 3. Quantitative and Qualitative Disclosures about Market Risks		28

Item 4. Controls and Procedures		29

Item 4T. Controls and Procedures		29

PART II. OTHER INFORMATION

Item 1. Legal Proceedings		30

Item 1A. Risk Factors		30

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds		30

Item 3. Defaults upon Senior Securities		30

Item 4. Submission of Matters to a Vote of Security Holders		30

Item 5. Other Information		31

Item 6. Exhibits		32

SIGNATURES		44

National Investment Managers Inc. and Subsidiaries

Condensed Consolidated Balance Sheet

	(Unaudited)			(Audited)
	June 30, 2008			December 31, 2007
ASSETS
Current assets:
Cash	$	2,027,898		$	3,254,759
Accounts receivable, net		4,887,364			3,383,396
Prepaid expenses and other current assets		762,831			797,605

Total current assets		7,678,093			7,435,760

Property and equipment, net		1,029,394			1,078,523

Other assets:
Goodwill		25,005,796			20,705,032
Customer lists/relationships, net		23,020,799			23,515,497
Other intangibles, net		5,166,951			5,796,615
Deferred financing costs		1,211,243			1,424,413

Total other assets		54,404,789			51,441,557

Total assets	$	63,112,276		$	59,955,840

LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Revolving Line of Credit	$	1,000,000		$	1,000,000
Long-term debt, current portion		4,285,676			809,813
Accounts payable		446,170			632,109
Unearned revenue		5,228,991			5,012,156
Accrued expenses and other current liabilities		4,232,047			3,976,498

Total current liabilities		15,192,884			11,430,576

Long-term liabilities:
Long-term debt, less current portion		17,756,594			18,916,147
Preferred dividends payable		4,883,519			3,892,419
Derivative financial instruments		5,634,557			5,375,897
Deferred tax liability		5,898,426			6,293,805

Total long-term liabilities		34,173,096			34,478,268

Total liabilities		49,365,980			45,908,844

Commitments and contingencies

Stockholders' equity:
Preferred stock, $.001 par value, 10,000,000 shares authorized; 4,000,000 designated as Series A shares - 2,420,000 shares issued and outstanding as of June 30, 2008 and December 31, 2007 (liquidation preference $2,420,000 as of June 30, 2008 and December 31, 2007); 4,000,000 designated as Series B shares - 3,615,000 and 3,715,000 shares issued and outstanding as of June 30, 2008 and December 31, 2007, respectively (liquidation preference $7,230,000 and $7,430,000 as of June 30, 2008 and December 31, 2007, respectively); 1,000,000 designated as Series C shares - 770,834 shares issued and outstanding as of June 30, 2008 and December 31, 2007 (liquidation preference $9,250,008 as of June 30, 2008 and December 31, 2007); 500,000 designated as Series D shares - 409,500 shares issued and outstanding as of June 30, 2008 and December 31, 2007 (liquidation preference $8,190,000 as of June 30, 2008 and December 31, 2007); and 60,000 designated as Series E shares - 29,350 shares issued and outstanding as of June 30, 2008 and December 31, 2007 (liquidation preference $5,870,000 as of June 30, 2008 and December 31, 2007)		7,245			7,345
Common stock, $.001 par value, 100,000,000 shares authorized, 37,158,748 and 35,539,620 shares issued and outstanding as of June 30, 2008 and December 31, 2007, respectively.		37,159			35,540
Additional paid-in capital		34,030,285			33,004,741
Accumulated deficit		(20,328,393	)		(19,000,630	)

Total stockholders' equity		13,746,296			14,046,996

Total liabilities and stockholders' equity	$	63,112,276		$	59,955,840

See accompanying notes to condensed consolidated interim financial statements.

National Investment Managers Inc. and Subsidiaries

Condensed Consolidated Statements of Operations

(Unaudited)

	Six Months Ended			Six Months Ended
	June 30, 2008			June 30, 2007

Revenues	$	20,701,529		$	16,987,120

Operating expenses:
Selling, general and administrative expenses		15,908,258			14,642,572
Depreciation and amortization		3,628,766			3,117,964
Stock-based compensation		807,064			285,507

Total operating expenses		20,344,088			18,046,043

Operating income (loss)		357,441			(1,058,923	)

Other income (expenses):
Change in fair value of derivative financial instruments		(258,660	)		(704,250	)
Interest expense		(1,325,887	)		(2,499,097	)
Interest, dividend and rental income		31,064			60,268

Total other expense, net		(1,553,483	)		(3,143,079	)

Loss before deferred income tax benefit		(1,196,042	)		(4,202,002	)

Deferred income tax benefit		859,379			677,325

Net loss before preferred stock dividends		(336,663	)		(3,524,677	)

Less: preferred stock dividends		(991,100	)		(1,053,700	)

Net loss available to common stockholders	$	(1,327,763	)	$	(4,578,377	)

Loss per common share - basic and diluted	$	(0.04	)	$	(0.17	)

Weighted average common shares outstanding - basic and diluted		36,537,000			26,653,000

See accompanying notes to condensed consolidated interim financial statements.

National Investment Managers Inc. and Subsidiaries

Condensed Consolidated Interim Statements of Operations

(Unaudited)

	Three Months Ended			Three Months Ended
	June 30, 2008			June 30, 2007

Revenues	$	11,761,070		$	10,326,159

Operating expenses
Selling, general and administrative expenses		7,950,968			7,813,720
Depreciation and amortization		1,889,378			1,715,827
Stock-based compensation		296,040			114,852

Total operating expenses		10,136,386			9,644,399

Operating income		1,624,684			681,760

Other income (expenses):
Change in fair value of derivative financial instruments		(634,817	)		(208,345	)
Interest expense		(662,183	)		(1,317,144	)
Interest, dividend and rental income		17,718			16,076

Total other expense, net		(1,279,282	)		(1,509,413	)

Income (loss) before deferred income tax benefit		345,402			(827,653	)

Deferred income tax benefit		487,982			460,566

Net income (loss) before preferred stock dividends		833,384			(367,087	)

Less: preferred stock dividends		(493,700	)		(535,650	)

Net income (loss) available to common stockholders	$	339,684		$	(902,737	)

Income (loss) per common share - basic	$	0.01		$	(0.03	)

Income (loss) per common share - diluted	$	0.01		$	(0.03	)

Weighted average common shares outstanding - basic		36,794,000			27,420,000

Weighted average common shares outstanding - diluted		75,065,000			27,420,000

See accompanying notes to condensed consolidated interim financial statements.

Condensed Consolidated Statements of Cash Flows

(Unaudited)

	Six Months Ended			Six Months Ended
	June 30, 2008			June 30, 2007
Net cash provided by operating activities	$	2,511,533		$	1,255,255

Cash flows from investing activities:
Purchases of property and equipment		(134,319	)		(162,224	)
Acquisition of Alaska Pension Services, Ltd.		(729,408	)		-
Acquisition of National Actuarial Pension Services, Ltd.		(21,623	)		-
Acquisition of Benefit Dynamics		(8,770	)		(340,000	)
Acquisition of Pentec and Pentec Capital Management		(40,246	)		(1,691,376	)
Acquisition of The Pension Alliance		(141,055	)		(3,380,000	)
Acquisition of California Investment and Annuity Services		(1,521,623	)		-

Net cash used in investing activities		(2,597,044	)		(5,573,600	)

Cash flows from financing activities:
Payments on long-term debt and notes		(1,107,532	)		(454,174	)
Proceeds from sale of common and preferred shares, net		-			1,150,219
Payment of deferred financing costs		(33,818	)		-

Net cash provided by (used in) financing activities		(1,141,350	)		696,045

Net decrease in cash		(1,226,861	)		(3,622,300	)

Cash, beginning of period		3,254,759			6,191,301

Cash, end of period	$	2,027,898		$	2,569,001

Supplemental disclosure of cash flows information:
Cash paid during the period for interest	$	1,161,893		$	993,931

Cash paid during the period for taxes	$	75,023		$	54,202

Supplemental schedules of noncash investing and financing activities:
Accrued preferred dividends	$	991,100		$	1,053,700

Noncash component of acquisition of The Pension Alliance	$	1,750,000		$	-

Noncash component of acquisition of Alaska Pension Services, Ltd.	$	605,000		$	-

Noncash component of acquisition of California Investment and Annuity Services	$	950,000		$	-

Capitalization of accrued interest on secured term notes	$	183,642		$	649,360

See accompanying notes to condensed consolidated interim financial statements

In conjunction with the Company's acquisitions, notes and common stock were issued and liabilities were assumed as follows (See Notes 11, 12, 13, 14 and 15):

				Pentec Inc. and Pentec
2007:	Benefit Dynamics Inc.			Capital Management			The Pension Alliance Inc.

Fair value of assets acquired	$	938,318		$	6,027,702		$	8,842,149
Cash paid		(348,770	)		(1,731,622	)		(3,521,055	)
Due to sellers		-			-			(1,250,000	)
Notes issued		(200,000	)		(1,450,000	)		(1,175,000	)
Common stock issued		-			(250,000	)		(675,000	)
Total liabilities assumed	$	389,548		$	2,596,080		$	2,221,094


		California Investment			Alaska Pension
2008:		Annuity Sales			Services, Ltd.

Fair value of assets acquired	$	2,935,623		$	1,399,158
Cash paid		(1,521,623	)		(729,408	)
Due to sellers		-			(165,000	)
Notes issued		(950,000	)		(220,000	)
Common stock issued		-			(220,000	)
Total liabilities assumed	$	464,000		$	64,750

National Investment Managers Inc. and Subsidiaries

Notes to Condensed Consolidated Interim Financial Statements

(Unaudited)

Note 1. Basis of Presentation and Consolidation

The accompanying unaudited condensed consolidated interim financial statements included herein have been prepared in accordance with generally accepted accounting principles for interim period reporting in conjunction with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, these statements do not include all of the information required by generally accepted accounting principles for annual financial statements. In the opinion of management, all known adjustments (consisting of normal recurring accruals and reserves) necessary to present fairly the financial position, results of operations and cash flows as of and for the interim periods have been included. It is suggested that these condensed consolidated interim financial statements be read in conjunction with the consolidated financial statements and related notes included in National Investment Managers Inc. Form 10-KSB for the year ended December 31, 2007.

The operating results for the six months ended June 30, 2008 are not necessarily indicative of the results to be expected for the full year ending December 31, 2008.

All significant intercompany transactions and balances have been eliminated in consolidation.

Note 2. Background and Liquidity

National Investment Managers Inc. (the “Company”) is in the principal business of acquiring and managing operating entities that offer third party administration primarily of retirement plans, financial and investment advisory services and insurance products to small and medium sized businesses in the United States and to high-net worth individuals. As of June 30, 2008, the Company owned 20 operating units in twelve states. The Company’s headquarters is located in Dublin, Ohio.

At June 30, 2008 and December 31, 2007, the Company's working capital deficit was approximately $7.5 million and $4.0 million, respectively and its accumulated deficit was approximately $20.3 million and $19.0 million, respectively. For the six months ended June 30, 2008 and June 30, 2007, the Company's net losses before preferred stock dividends were approximately $0.3 million and $3.5 million, respectively and its cash flows from operations were approximately $2.5 million and $1.3 million, respectively. Based upon management's current forecast of future revenues from its acquired businesses, its history of capital raising and other factors, the Company believes its cash resources will be adequate to support its acquisition model and fund operations in 2008.

Note 3. Adoption of New Accounting Pronouncements

In September 2006, the Financial Accounting Standards Board (“FASB”) issued Statement of Financial Accounting Standard (“SFAS”) No. 157, “Fair Value Measurements” which defines fair value, establishes a framework for measuring fair value in accordance with generally accepted accounting principles (“GAAP”), and expands disclosures about fair value measurements. SFAS No. 157 simplifies and codifies related guidance within GAAP, but does not require any new fair value measurements. The guidance in SFAS No. 157 applies to derivatives and other financial instruments measured at estimated fair value under SFAS No. 133 and related pronouncements. SFAS No. 157 is effective for us beginning January 1, 2008. (See Note 10).

In December 2007, the Securities and Exchange Commission issued Staff Accounting Bulletin No. 110 (“SAB 110”). SAB 110 was effective January 1, 2008 and expresses the views of the Staff of the SEC regarding the use of the simplified method, as discussed in SAB No. 107, in developing an estimate of the expected term of "plain vanilla" share options in accordance with SFAS No. 123R. The adoption of SAB No. 110 did not have a material effect on the Company’s financial position, results of operations and cash flows.

Note 4. New Accounting Pronouncements

In December 2007, the FASB issued SFAS No. 160, “Noncontrolling Interests in Consolidated Financial Statements - an amendment of Accounting Research Bulletin No. 51” (“SFAS No. 160”). SFAS 160 establishes accounting and reporting standards for ownership interest in subsidiaries held by parties other than the parent, the amount of consolidated net income attributable to the parent and to the noncontrolling interest, changes in a parent’s ownership interest, and the valuation of retained noncontrolling equity investments when a subsidiary is deconsolidated. SFAS No. 160 also establishes disclosure requirements that clearly identify and distinguish between the interest of the parent and the interest of the noncontrolling owners. SFAS No. 160 is effective for us beginning January 1, 2009. Management is currently evaluating the potential impact of applying the provisions of SFAS No. 160 on our consolidated financial statements.

In December 2007, the FASB issued SFAS No. 141(R), "Business Combinations" ("SFAS 141(R)") which requires the acquiring entity in a business combination to recognize most identifiable assets acquired, liabilities assumed, noncontrolling interests and goodwill acquired in a business combination at full fair value; establishes the acquisition- date fair value as the measurement objective for all assets acquired and liabilities assumed; and requires the acquirer to disclose to investors and other users all of the information they need to evaluate and understand the nature and financial effect of the business combination. SFAS 141(R) is effective for us beginning January 1, 2009. Management is currently evaluating the impact of applying the provisions of SFAS 141(R) on our consolidated financial statements.

In March 2008, the FASB issued SFAS No. 161, “Disclosures about Derivative Instruments and Hedging Activities” (“SFAS 161”). SFAS 161 requires enhanced disclosures about an entity’s derivative and hedging activities and thereby improves the transparency of financial reporting. The objective of the guidance is to provide users of financial statements with an enhanced understanding of how and why an entity uses derivative instruments; how derivative instruments and related hedged items are accounted for; and how derivative instruments and related hedged items affect an entity’s financial position, financial performance, and cash flows. SFAS 161 is effective for us beginning January 1, 2009. Management is currently evaluating the impact of applying the provisions of SFAS 161 on our consolidated financial statements.

In May 2008, the FASB issued SFAS No. 162, “The Hierarchy of Generally Accepted Accounting Principles”. SFAS 162 identifies the sources of accounting principles and the framework for selecting the principles to be used in the preparation of financial statements of nongovernmental entities that are presented in conformity with generally accepted accounting principles in the United States. It is effective 60 days following the Securities and Exchange Commission’s approval of the Public Company Accounting Oversight Board amendments to AU Section 411, “The Meaning of Present Fairly in Conformity With Generally Accepted Accounting Principles”. The adoption of this statement is not expected to have a material effect on our consolidated financial statements.

Note 5. Long-term Debt and Derivative Liabilities

Long-term debt activity for the six months ended June 30, 2008 consisted of the following:

	(Audited) Balances at December 31, 2007			Add: New Debt		Less: Payments			Add: Amortization		(Unaudited) Balances at June 30, 2008
Senior Term Note	$	8,000,000			-						$	8,000,000
Subordinated Sr Note		12,032,000			183,642							12,215,642
Seller notes		2,725,000			2,920,000		(1,087,500	)				4,557,500
Capitalized leases		95,191					(20,032	)				75,159
		22,852,191										24,848,301
Less: unamortized debt discount		(3,126,231	)							320,200		(2,806,031	)
		19,725,960										22,042,270
Less: current portion		(809,813	)									(4,285,676	)
	$	18,916,147									$	17,756,594

Seller Financing

In connection with our acquisition strategy, part of the purchase price is paid through seller financed instruments. As of June 30, 2008, total funds due to former owners were $4,557,500. Of this amount, $3,312,500 is due in the next 12 months and $1,245,000 is due thereafter. Seller financed instruments bear interest at 6% per annum. All seller financed instruments are uncollateralized. Currently, $337,500 of the notes may be convertible into common stock in lieu of cash. The number of shares of common stock issuable upon a conversion equals the quotient obtained by dividing the outstanding amount of the notes to be converted by the conversion price of $0.62.

Revolving Line of Credit, Senior Term Note and Subordinated Senior Term Note

On November 30, 2007, the Company entered into (i) a Revolving Line of Credit and Term Loan Agreement (the "Senior Loan Agreement") with RBS Citizens, National Association (the “Senior Lender”) and (ii) a Securities Purchase and Loan Agreement (the "Subordinated Senior Agreement") with Woodside Capital Partners IV, LLC, Woodside Capital Partners IV QP, LLC and Lehman Brothers Commercial Bank (the “Subordinated Senior Lenders”). Pursuant to the Senior Loan Agreement, the Company issued and sold a Revolving Line of Credit Note in the initial amount of $1,000,000 (the "Revolver") and a Term Loan Promissory Note in the initial amount of $8,000,000 (the "Term Loan"). The Revolver and the Term Loan mature on July 31, 2010. As of June 30, 2008, the outstanding principal balance of the Revolver and the Term Loan was $1.0 million and $8.0 million, respectively and the interest rate was 5.13% and 5.63%, respectively.

On July 15, 2008, the Company borrowed an additional $2,358,375 on the Term Loan. All original terms of the loan remain the same. As part of the transaction, the Company paid $22,102 in deferred financing costs which will be amortized over the remaining life of the loan.

Pursuant to the terms of the Subordinated Senior Agreement, the Company issued and sold three Senior Secured Term Notes in the aggregate amount of $12 million. The Subordinated Senior Notes mature on the earlier of January 31, 2011, the occurrence of a capital transaction or an event of default. A capital transaction includes the sale, disposition, dissolution or liquidation of the Company's assets or subsidiaries, the acquisition by any person of 30% or more of the Company's common stock or a public offering in the minimum amount of $20,000,000 (a "Capital Transaction"). The Company may prepay the Subordinated Senior Notes at any time after May 30, 2009. As of June 30, 2008, the outstanding principal balance of the Subordinated Senior Notes was approximately $12.2 million.

In conjunction with executing the Subordinated Senior Agreement, the Company issued warrants (the “Subordinated Senior Warrants”) to the Subordinated Senior Lenders to purchase 5,742,789, 3,828,527 and 1,914,262 shares of common stock at $0.50, $1.00 and $1.50 per share, respectively. The Subordinated Senior Warrants are exercisable through November 2017. Subsequent to January 31, 2011, the consummation of a Capital Transaction or an event of default, the Subordinated Senior Lenders may elect to sell to the Company all or a portion of the shares issuable upon exercise of the Subordinated Senior Warrants (the “Subordinated Senior Put"). The cash payment to be made by the Company shall be determined by dividing the greater of a) the value of the Company’s common stock as determined by negotiations between the Company and the holder of the Subordinated Senior Warrants, b) six multiplied by the trailing twelve months of earnings before interest, taxes, depreciation and amortization less debt of the Company, less aggregate liquidation value of preferred shares plus cash, or c) the closing stock price of the Company’s common stock multiplied by the number of fully diluted common shares outstanding, plus consideration received by the Company upon exercise of all exercisable outstanding warrants, options or other securities convertible into common stock, by the number of shares outstanding on a fully diluted basis (the “Repurchase Price”).

At any time following January 31, 2011, the date of consummation of a Capital Transaction or an event of default, the Subordinated Senior Lenders may elect to require the Company to pay an additional fee (the "Fee Agreement") as well as the Conditional Interest Payment ("CIP Payment"). The Fee Agreement is based upon the Subordinated Senior Lenders ownership in the Company and the per share price of the Company's common stock. The CIP Payment is equal to 5% of the Company's equity value which is payable on the 90th day following receipt of such notice from the Subordinated Senior Lenders and an additional payment equal to 1.5% of the Company's equity value is payable on the end of each calendar quarter thereafter. The aggregate CIP Payment may not exceed 15% of the Company's equity value. At any time after the Subordinated Senior Lenders deliver notice with respect to the CIP Payment, the Company may elect to purchase the shares of common stock underlying the Subordinated Senior Warrants at the Repurchase Price.

The Subordinated Senior Lenders have both demand and piggyback registration rights with respect to shares issuable upon conversion of the Subordinated Senior Warrants or any other shares held at the time of the request. The Company must use its best efforts in good faith to affect the registration of these shares.

Derivative Liabilities

Pursuant to Paragraph 12 of EITF No. 00-19, "Accounting for Derivative Financial Instruments Indexed to, and Potentially Settled in, a Company's Own Stock", the Subordinated Senior Put and the Fee Agreement, meet the requirements of and are accounted for as a liability since they could require net-cash settlement by the Company. This option to net-cash settle is out of the Company’s control. The value of the Subordinated Senior Put and the Fee Agreement was determined using the formula outlined in section 11 of the Securities Purchase and Loan Agreement and section 1.3 of the Fee Agreement. The value of the derivative financial instruments are reassessed at each balance sheet date and marked to market as a derivative gain or loss until exercised or expiration. Upon exercise, the related liability is removed by recording an adjustment to additional paid-in-capital. At June 30, 2008, the Subordinated Senior Put had a value of $3,155,451 and the Fee Agreement had a value of $809,099.

Pursuant to Paragraph 17 of EITF No. 00-19, "Accounting for Derivative Financial Instruments Indexed to, and Potentially Settled in, a Company's Own Stock", the Company has warrants and options (collectively “the derivative financial instruments”) that meet the requirements of and are accounted for as a liability as they contain registration rights and the agreement is silent on how the contract would be settled. By being silent, the agreement assumes net-cash settlement in the event that the Company is unable to deliver registered shares. The value of the derivative financial instruments was determined using a Black-Scholes option pricing model with the following assumptions: expected term – 3-4 years, volatility - 60%, risk free rate - 2.9% to 3.3%, which coincides with the remaining expected life of the derivative financial instruments, and zero dividend yield. Their value is reassessed at each balance sheet date and marked to market as a derivative gain or loss until exercised or expiration. Upon exercise, the related liability is removed by recording an adjustment to additional paid-in-capital. As of June 30, 2008, the derivative financial instruments had a value of $1,173,363.

In connection with the acquisition of the assets of American Benefit Resources (“ABR”), the Company issued a total of 671,141 shares of common stock to the former owner of the assets. In connection with the acquisition, Duncan Capital Group LLC and DCI Master LDC ("Optionees") entered into a put agreement with IBF Fund Liquidating LLC ("IBF" and collectively with ABR, the "ABR Sellers") whereby Optionees may become obligated, between the second and third anniversaries of the closing of the acquisition, to purchase, for up to $1 million, the shares delivered to ABR Sellers as a portion of the purchase price of ABR. On December 20, 2006, the Company and the Optionees entered into an agreement (the "Optionee Agreement") pursuant to which the Company agreed to make a payment to the Optionees of $1.49 less the market value per share for each share purchased by the Optionees from ABR Sellers in the event that the Sellers exercise their put (“Duncan Put Liability”) with the Optionees. On November 30, 2007, the Company and the Optionees entered into an amendment to the Optionee Agreement whereby the Optionees provide the Company with the rights to acquire the shares from the ABR Sellers in the event that the shares are put to the Optionees. As of June 30, 2008, the Duncan Put Liability had a value of $496,644.

Note 6. Stockholders’ Equity

Series B Preferred Stock Conversion

On March 10, 2008, a holder of 100,000 shares of Series B Convertible Preferred Stock converted those share into 200,000 shares of common stock.

Common Stock and Stock Options

On January 2, 2008, the Company issued 700,000 shares of restricted common stock to the Chief Executive Officer as part of his November 30, 2007 employment agreement.

On April 17, 2008, the Company issued 350,000 shares of restricted common stock to the President and Chief Operating Officer as part of his March 15, 2007 employment agreement.

On April 18, 2008 the Company issued a Stock Option Agreement to the President and COO granting him the option to purchase 200,000 shares of restricted common stock of the Company at a price of $0.61 per share as part of the April 2008 addendum to his March 15, 2007 employment agreement.

On June 30, 2008, the Company issued 369,128 shares of common stock in connection with the acquisition of 100% of the outstanding shares of Alaska Pension Services Ltd.

Note 7. Stock-Based Compensation

The Company complies with the fair value recognition provisions of Statement of Financial Accounting Standards ("SFAS") No. 123 (2004 Revised), "Share Based Payment". SFAS No. 123(R) requires that compensation cost for all stock awards be calculated and recognized over the service period (generally equal to the vesting period). This compensation cost is determined using option pricing models intended to estimate the fair value of the awards at the grant date. An offsetting increase to stockholders' equity is recorded equal to the amount of the compensation expense charge. The fair value of issued stock options and warrants are estimated on the date of grant using the Black-Scholes option-pricing model including the following assumptions: expected volatility range of 25.0% to 60.0%, expected dividend yield rate of 0%, expected life over the term, generally, 5 or 7 years, and a range of risk-free interest rates of 3.0% to 4.2% which coincides with the expected life of the options and warrants at the time of issuance. During the six month periods ended June 30, 2008 and June 30, 2007, the Company recorded stock-based compensation of $807,064 and $285,507, respectively. During the three month periods ended June 30, 2008 and June 30, 2007, the Company recorded stock-based compensation of $296,040 and $114,852, respectively. There was no cash flow effect resulting from these arrangements.

The following is a summary of all option activity through June 30, 2008:

	Number of Shares Outstanding			Weighted Avg. Price		Weighted Average Remaining Term (in years)		Aggregate Instrinsic Value

Outstanding, December 31, 2007		4,054,963		$	0.83		3.91	$	222,800
Granted		220,000		$	0.61
Exercised		-		$	-
Forfeited		(500	)	$	1.00
Outstanding, June 30, 2008		4,274,463		$	0.81		3.48	$	296,850

Exercisable, June 30, 2008		3,035,296		$	0.89		3.11	$	122,850

We settle stock option exercises with newly issued shares of common stock. The total compensation cost not yet recognized for non-vested awards of $311,930 has a weighted average period of 1.31 years over which the compensation expense is expected to be recognized.

Note 8. Earnings (Loss) Per Common Share

The Company complies with the accounting and reporting requirements of SFAS No. 128, "Earnings Per Share". Basic net income (loss) per common share includes no dilution and is computed by dividing net loss available to common stockholders by the weighted average number of shares of common stock outstanding for the period. Diluted net income per common share reflects, in the periods in which they have a dilutive effect, the dilution which would occur upon the exercise of stock options and warrants, and the conversion of convertible preferred stock and notes.

Unexercised stock options and warrants to purchase common stock, and preferred stock and notes convertible into common stock as of June 30, 2008 and 2007, respectively, are as follows:

	June 30, 2008		June 30, 2007

Options and warrants		26,946,519		16,157,773
Preferred stock		32,960,008		34,710,008
Convertible notes		544,355		3,763,506
		60,450,882		54,631,287

The foregoing common stock equivalents were excluded from the calculation of diluted net loss per common share for the six months ended June 30, 2008 and June 30, 2007, respectively, and the three months ended June 30, 2007 since their inclusion would be anti-dilutive.

Note 9. Income Taxes

In June 2006, the FASB issued FIN 48 - Accounting for Uncertainty of Income Taxes, an Interpretation of FASB Statement No. 109, to create a single model to address accounting for uncertainty in tax provisions. FIN 48 requires all material tax positions to undergo a new two-step recognition and measurement process. All material tax positions in jurisdictions in all tax years in which the statue of limitations remains open upon the initial date of adoption are required to be assessed. For a tax benefit to be recognized it must be more likely than not that a tax position will be sustained upon examination based solely on its technical merits. If the recognition standard is not satisfied, then no tax benefit otherwise arising from the tax position can be recorded for financial statement purposes. If the recognition standard is satisfied, the amount of tax benefit recorded for financial statement purposes will be the largest amount of tax benefit with a greater than 50% likelihood of being realized upon ultimate settlement with a taxing authority. The adoption of FIN 48 on January 1, 2007 did not have a material impact on the Company’s financial position, results of operations, or cash flows for the six months ended June 30, 2008 and June 30, 2007, respectively. Additionally, FIN 48 provides guidance on the recognition of interest and penalties related to income taxes. There is no interest or penalties related to income taxes that have been accrued or recognized as of June 30, 2008.

Note 10. Fair Value Measurements

In September 2006, the FASB issued Statement of Financial Accounting Standard (“SFAS”) No. 157, “Fair Value Measurements” which defines fair value, establishes a framework for measuring fair value in accordance with generally accepted accounting principles (“GAAP”), and expands disclosures about fair value measurements. SFAS No. 157 simplifies and codifies related guidance within GAAP, but does not require any new fair value measurements. The guidance in SFAS No. 157 applies to derivatives and other financial instruments measured at estimated fair value under SFAS No. 133 and related pronouncements.

The liabilites measured at fair valued on a recurring basis as of June 30, 2008 are as follows:

	Fair Value at Reporting Date Using
Description	June 30, 2008		Quoted Price in Active Markets for Indentical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)

Derivative financial instruments	$	5,634,557	$	-	$	-	$	5,634,557

Reconciliation of liabilities measured at fair value on a recurring basis using significant unobservable inputs as of June 30, 2008 is as follows:

	Fair Value Measurments Using Significant Unobservable Inputs (Level 3)

Beginning balance - 12/31/2007	$	5,375,897
Total (gains) losses (realized/unrealized)
Included in earnings (or changes in net liabilities)		258,660

Ending balance - 06/30/2008	$	5,634,557

The amount of total (gains) losses for the period included in earnings (or changes in net liabilities) attributable to the change in unrealized (gains) losses relating to assets still held at the reporting date	$	258,660

Note 11. Acquisition of Benefit Dynamics, Inc.

On January 2, 2007, the Company entered into and closed a Stock Purchase Agreement (the "BDI Agreement") with Jo Ann Massanova and Carmen LaVerghetta ("Sellers") and Benefit Dynamics, Inc. ("BDI"). Pursuant to the BDI Agreement, the Company acquired and, the Sellers sold, 100% of the outstanding securities in BDI. In consideration for 100% of the outstanding securities in BDI, the Company paid the Sellers $300,000 in cash, issued the Sellers promissory notes for an aggregate of $200,000. The first promissory notes in the aggregate amount of $100,000 were paid on March 2, 2008 and the second promissory notes in the aggregate amount of $100,000 are payable on March 2, 2009. In 2008, the Company paid $8,770 in contingency payments based on BDI meeting certain EBITDA targets according to the terms of the BDI Agreement. The total consideration paid was $508,770.

The Company’s strategy in purchasing BDI was to acquire a pension advisory organization with recurring revenue streams and consolidate this business to take advantage of economics of scale, efficiencies, and cross-selling opportunities. The Company believes that BDI had demonstrated stable revenue growth and cash flow with low client attrition rates.

As part of the terms of the sale of BDI, Jo Ann Massanova and Carmen LaVerghetta were awarded two-year employment agreements, and agreed to be bound by non-compete and non-solicit agreements.

The acquisition of BDI is accounted for under the purchase method of accounting in accordance with SFAS No. 141, "Business Combinations." Under the purchase method, assets acquired and liabilities assumed are recorded at their estimated fair values. Goodwill is recorded to the extent the purchase price, including certain acquisition and closing costs, exceeds the fair value of the net identifiable tangible and intangible assets acquired at the date of the acquisition.

The total purchase price for the acquisition of BDI of $548,770 (including $40,000 of acquisition costs) is being allocated as follows:

Assets acquired:
Customer lists/relationships	$	540,000
Goodwill		398,318
		938,318

Liabilities assumed:
Other Liabilities		173,548
Deferred tax liabilities		216,000

Net purchase price	$	548,770

The identifiable intangible assets listed above will be amortized for book purposes over the estimated useful lives of the assets. The amortization of most of the identifiable intangible assets and goodwill are not deductible for tax purposes. Additional consideration or adjustments are recorded in the condensed consolidated financial statements as goodwill.

Note 12. Acquisition of Pentec, Inc. and Pentec Capital Management, Inc.

On February 28, 2007, the Company entered into and closed a Stock Purchase Agreement (the "Pentec Agreement") with Michael E. Callahan ("Callahan"), Pentec, Inc. ("Pentec ") and Pentec Capital Management, Inc. ("PCM"). Pursuant to the Agreement, the Company acquired and, Callahan sold, 100% of the outstanding securities in Pentec and PCM. In consideration for 100% of the outstanding securities in Pentec and PCM, the Company paid Callahan $1,517,000 in cash, issued Callahan an aggregate of 403,225 shares of common stock of the Company valued at $0.62 per share for a total value of $250,000, and issued Callahan promissory notes for an aggregate of $1,450,000 with payments to be made in accordance with the following schedule: (i) $300,000 was paid on November 1, 2007, (ii) $300,000 was paid on May 1, 2008, (iii) $250,000 is payable on November 1, 2008, (iv) $300,000 is payable on May 1, 2009 and (v) $300,000 is payable on November 1, 2009. In 2008, the Company paid $40,246 in contingency payments based on Pentec and PCM meeting certain EBITDA targets according to the terms of the Pentec Agreement. The total consideration paid was $3,257,246.

The Company’s strategy in purchasing Pentec and PCM was to acquire a pension advisory organization with recurring revenue streams and consolidate this business to take advantage of economies of scale, efficiencies, and cross-selling opportunities. The Company believes that Pentec and PCM had demonstrated stable revenue growth and cash flow with low client attrition rates.

As part of the terms of the sale of Pentec and PCM, Michael E. Callahan was awarded a two-year employment agreement, and agreed to be bound by non-compete and non-solicit agreements.

The acquisition of Pentec and PCM is accounted for under the purchase method of accounting in accordance with SFAS No. 141, "Business Combinations." Under the purchase method, assets acquired and liabilities assumed are recorded at their estimated fair values. Goodwill is recorded to the extent the purchase price, including certain acquisition and closing costs, exceeds the fair value of the net identifiable tangible and intangible assets acquired at the date of the acquisition.

The total purchase price for the acquisition of Pentec and PCM of $3,431,622 (including $174,376 of acquisition costs) is being allocated as follows:

Assets acquired:
Property and equipment	$	289,364
Customer lists/relationships		2,351,000
Covenant not to compete		1,731,000
Trade name		187,000
Employment contracts		287,000
Goodwill		1,182,338
		6,027,702

Liabilities assumed:
Unearned revenue		1,184,854
Deferred tax liability		1,142,092
Other Liabilities		269,134

Net purchase price	$	3,431,622

Note 13. Acquisition of The Pension Alliance, Inc.

On February 28, 2007, we entered into a Stock Purchase Agreement (the “TPA Agreement") to purchase 100% of the Common Stock of The Pension Alliance, Inc. ("TPA"). The Company paid $3,250,000 in cash, issued convertible promissory notes for an aggregate of $675,000, and issued 1,088,710 shares of common stock of the Company valued at $675,000. The first convertible promissory note in the amount of $337,500 was paid on April 28, 2008 and the second convertible promissory note in the amount of $337,500 is payable on April 28, 2009. The outstanding convertible promissory note is convertible into shares of common stock of the Company at a conversion price of $0.62 per share. In the event that certain EBITDA targets are not achieved by TPA during the 24 months following the closing date, the convertible promissory notes and shares of common stock will be reduced by the amount of such shortfall. In 2008, the Company paid $106,055 in contingency payments based on TPA meeting certain EBITDA targets according to the terms of the TPA Agreement. The total consideration paid was $4,706,055.

The Company’s strategy in purchasing TPA was to acquire a pension advisory organization with recurring revenue streams and consolidate this business to take advantage of economies of scale, efficiencies, and cross-selling opportunities. The Company believes that TPA had demonstrated stable revenue growth and cash flow with low client attrition rates.

As part of the terms of the sale of TPA, Renee J. Conner was awarded a two-year employment agreement, and agreed to be bound by non-compete and non-solicit agreements. The Company also issued an option to purchase 100,000 shares of common stock at an exercise price of $0.62 per share to Renee J. Conner.

The acquisition of TPA is accounted for under the purchase method of accounting in accordance with SFAS No. 141, "Business Combinations." Under the purchase method, assets acquired and liabilities assumed are recorded at their estimated fair values. Goodwill is recorded to the extent the purchase price, including certain acquisition and closing costs, exceeds the fair value of the net identifiable tangible and intangible assets acquired at the date of the acquisition.

On May 14, 2008, the Company executed a Settlement Agreement and Release (the “Settlement Agreement”) with the Sellers of TPA under which the parties agreed to resolve certain aspects of the TPA Agreement. Under the Settlement Agreement, the Company agreed to pay to Sellers an aggregate amount of $1,750,000 consisting of (1) $1,250,000 in cash payable on or before July 31, 2008 and (2) $500,000 payable under two promissory notes each in the amount of $250,000 (one payable on April 30, 2009 and one payable on October 31, 2009). The parties also agreed to adjust the payment of the promissory notes down if certain financial targets were not met. In addition, the parties agreed to mutually release the other party from certain claims that might arise under the TPA Agreement.

The total purchase price for the acquisition of TPA of $6,621,055 (including $165,000 of acquisition costs) is being allocated as follows:

Assets acquired:
Customer lists/relationships	$	2,470,000
Covenant not to compete		1,713,000
Trade name		291,000
Employment contracts		256,000
Goodwill		4,112,149
		8,842,149

Liabilities assumed:
Unearned revenue		1,014,294
Deferred tax liability		1,206,800

Net purchase price	$	6,621,055

Note 14. Acquisition of California Investment and Annuity Sales

On April 3, 2008, the Company signed a Stock Purchase Agreement (the “CIAS Agreement”) with Richard Kaplan and Anthony Delfino (“Sellers”) and California Investment and Annuity Sales, Inc. (“CIAS”). The CIAS Agreement was effective as of March 31, 2008. Pursuant to the CIAS Agreement, the Company acquired and the Sellers sold, 100% of the outstanding securities in CIAS. In consideration for 100% of the outstanding securities in CIAS, the Company paid the Sellers $1,425,000 in cash, issued the Sellers promissory notes for an aggregate of $950,000 with the first promissory notes in the amount of $475,000 payable June 3, 2009 and the second promissory notes in the amount of $475,000 payable June 3, 2010 . In the event that certain revenue targets are not achieved by CIAS during the 24 months following the closing date, the promissory notes will be reduced by the amount of such shortfall. The total consideration paid was $2,375,000.

The Company’s strategy in purchasing CIAS was to acquire an investment service organization with recurring revenue streams and consolidate this business to take advantage of economies of scale, efficiencies, and cross-selling opportunities. The Company believes that CIAS has demonstrated stable revenue growth and cash flow with low client attrition rates.

As part of the terms of the sale of CIAS, Richard Kaplan was awarded one-year employment agreement and Anthony Delfino a one-year consulting agreement, and agreed to be bound by non-disclosure and non-solicit agreements.

The acquisition of CIAS is accounted for under the purchase method of accounting in accordance with SFAS No. 141, "Business Combinations." Under the purchase method, assets acquired and liabilities assumed are recorded at their estimated fair values. Goodwill is recorded to the extent the purchase price, including certain acquisition and closing costs, exceeds the fair value of the net identifiable tangible and intangible assets acquired at the date of the acquisition.

The total purchase price for the acquisition of CIAS of $2,471,623 (including $96,623 of acquisition costs) is being allocated, based on the results of an independent valuation, as follows:

Assets acquired:
Customer lists/relationships	$	880,000
Covenant not to compete		550,000
Employment contracts		280,000
Goodwill		1,225,623
		2,935,623

Liabilities assumed:
Deferred tax liability		464,000

Net purchase price	$	2,471,623

Note 15. Acquisition of Alaska Pension Services, Ltd.

On June 30, 2008, the Company entered into a Stock Purchase Agreement (the “Alaska Pension Agreement”) with Karen Jordan and Duane Mayer (“Sellers”) to purchase 100% of the outstanding capital stock in Alaska Pension Services, Ltd. (“Alaska Pension”). In consideration for 100% of the outstanding capital stock of Alaska Pension, the Company paid the Sellers $430,766 in cash at closing, with an additional $165,000 due at December 31, 2008, paid indebtedness, and other obligations of Alaska Pension of $192,073, issued 369,128 shares of common stock of the Company valued at $220,000 (the value of the common stock was determined by an average of the closing stock price of the last 5 days prior to the announced acquisition), issued the Sellers promissory notes for an aggregate of $220,000 with the first set of promissory notes in the amount of $110,000 payable August 31, 2009 and the second set of promissory notes in the amount of $110,000 payable August 31, 2010. In the event that certain EBITDA targets are not achieved by Alaska Pension during the 24 months following the closing date, the promissory notes will be reduced by the amount of such shortfall. The total consideration paid was $1,227,839.

The Company’s strategy in purchasing Alaska Pension was to acquire a pension advisory organization with recurring revenue streams and consolidate this business to take advantage of economies of scale, efficiencies and cross-selling opportunities.

As part of the terms of the sale of Alaska Pension, Karen Jordan and Duane Mayer were awarded two-year employment agreements and agreed to be bound by non-disclosure and non-solicit agreements.

The acquisition of Alaska Pension is accounted for under the purchase method of accounting in accordance with SFAS No. 141, “Business Combinations.” Under the purchase method, assets acquired and liabilities assumed are recorded at their estimated fair values. Goodwill is recorded to the extent the purchase price, including certain acquisition and closing costs, exceeds the fair value of the net identifiable tangible and intangible assets acquired at the date of the acquisition.

The total purchase price for the acquisition of Alaska Pension of $1,334,408 (including $106,569 of acquisition costs) is being preliminarily allocated as follows (pending the results of an independent valuation to be completed):

Assets acquired:
Property and equipment	$	43,243
Accounts Receivable		198,634
Goodwill		1,113,447
Other Assets		43,834
		1,399,158

Liabilities assumed:
Other Liabilities		64,750

Net purchase price	$	1,334,408

Goodwill is not deductible for tax purposes. Additional consideration or adjustments will be recorded in the condensed consolidated financial statements as goodwill.

Note 16. Unaudited Proforma interim Financial Information - Six and three months ended June 30, 2008 and 2007

The results of operations of the Company’s various acquisitions have been included in the accompanying unaudited condensed consolidated statements of operations since the respective acquisition dates.

The following unaudited proforma information gives effect to the acquisitions of CIAS, BDI, Pentec, PCM, TPA and Alaska Pension as if the acquisitions all took place on January 1, 2007. The Proforma information does not necessarily reflect the results of operations that would have occurred had the entities been a single company during the periods presented.

	(Unaudited)			(Unaudited)
	Six Months Ended			Six Months Ended
	June 30, 2008			June 30, 2007

Revenues	$	21,299,922		$	18,697,295

Net loss available to common shareholders	$	(1,228,980	)	$	(4,107,457	)

Loss per common share - basic and diluted	$	(0.03	)	$	(0.14	)

	(Unaudited)		(Unaudited)
	Three Months Ended		Three Months Ended
	June 30, 2008		June 30, 2007

Revenues	$	12,042,387	$	10,753,499

Net income (loss) available to common shareholders	$	462,806	$	(837,370	)

Net income (loss) per common share - basic	$	0.01	$	(0.03	)

Net income (loss) per common share - diluted	$	0.01	$	(0.03	)

Note 17. Subsequent Events

On July 16, 2008, the Company entered into a Stock Purchase Agreement (“Kanter Agreement”) to purchase 100% of the Common Stock of Alan N. Kanter & Associates, Inc. (“Kanter & Associates”). The Company paid $1,732,467 in cash.

The Company’s strategy in purchasing Kanter & Associates was to acquire a pension advisory organization with recurring revenue streams and consolidate this business to take advantage of economies of scale, efficiencies, and cross-selling opportunities. The Company believes that Kanter & Associates had demonstrated stable revenue growth and cash flow with low client attrition rates.

As part of the terms of the sale of Kanter & Associates, Alan N. Kanter was awarded a two-year employment agreement, and agreed to be bound by non-compete and non-solicit agreements.

ITEM 2. Management’s Discussion and Analysis or Plan of Operations

Results of Operations:

Six Month Period Ended June 30, 2008 Compared to June 30, 2007

	(Unaudited)						(Unaudited)
	Six Months Ended			% of			Six Months Ended			% of			$ Change			% Change
	June 30, 2008			Revenues			June 30, 2007			Revenues			2008 to 2007			2008 to 2007

Revenues	$	20,701,529			100.0	%	$	16,987,120			100.0	%	$	3,714,409			21.9	%

Operating expenses:
Selling, general and administrative expenses		15,908,258			76.8	%		14,642,572			86.2	%		1,265,686			8.6	%
Depreciation and amortization		3,628,766			17.5	%		3,117,964			18.4	%		510,802			16.4	%
Stock-based compensation		807,064			3.9	%		285,507			1.7	%		521,557			182.7	%

		20,344,088			98.3	%		18,046,043			106.2	%		2,298,045			12.7	%

Net operating income (loss)		357,441			1.7	%		(1,058,923	)		-6.2	%		1,416,364			-133.8	%

Other income (expenses):
Change in fair value of derivative financial instruments		(258,660	)		-1.2	%		(704,250	)		-4.1	%		445,590			-63.3	%
Interest expense		(1,325,887	)		-6.4	%		(2,499,097	)		-14.7	%		1,173,210			-46.9	%
Interest, dividend and rental income		31,064			0.2	%		60,268			0.4	%		(29,204	)		-48.5	%

		(1,553,483	)		-7.5	%		(3,143,079	)		-18.5	%		1,589,596			-50.6	%

Net loss before deferred income tax benefit		(1,196,042	)		-5.8	%		(4,202,002	)		-24.7	%		3,005,960			-71.5	%

Deferred income tax benefit		859,379			4.2	%		677,325			4.0	%		182,054			26.9	%

Net loss before preferred stock dividends		(336,663	)		-1.6	%		(3,524,677	)		-20.7	%	$	3,188,014			-90.4	%

Less preferred stock dividends		(991,100	)					(1,053,700	)

Net loss available to common stockholders	$	(1,327,763	)				$	(4,578,377	)

Net loss per common share - basic and diluted	$	(0.04	)				$	(0.17	)

Weighted average common shares outstanding - basic and diluted		36,537,000						26,653,000

Operating Income (Loss)

Revenues for the six months ended June 30, 2008 increased $3,714,409 to $20,701,529 compared to the six months ended June 30, 2007 as shown on the table above. The increase in revenues and operating expenses were due primarily to revenue generated and costs incurred by firms that were acquired during the first quarter of 2008 and 2007. In addition, during 2008, several of our retirement plan administration subsidiaries increased revenues as a result of implementing requirements of the Pension Protection Act of 2006. Operating expenses for the six months ended June 30, 2008 increased $2,298,045 to $20,344,088 over the prior year's comparable six month period. As a percentage of revenue, operating expenses decreased to 98.3% for the six months ended June 30, 2008 as compared to 106.2% for the six months ended June 30, 2007.

Selling, general and administrative expenses for the six months ended June 30, 2008 increased $1,265,686 to $15,908,258 over the prior year's comparable six month period. As a percentage of revenue, selling, general and administrative expenses decreased to 76.8% for the six months ended June 30, 2008 as compared to 86.2% for the six months ended June 30, 2007.

Depreciation and amortization for the six months ended June 30, 2008 increased $510,802 to $3,628,766 over the prior year's comparable six month period primarily due to amortization of intangible assets acquired in connection with acquisitions during the first quarter of 2008 and 2007. As a percentage of revenue, depreciation and amortization decreased to 17.5% for the six months ended June 30, 2008 as compared to 18.4% for the six months ended June 30, 2007.

Stock-based compensation for the six months ended June 30, 2008 increased $521,557 to $807,064 over the prior year's comparable six month period due primarily to the issuance of 700,000 shares of common stock to the CEO as part of his new employment agreement, the issuance of 350,000 shares of common stock to the President and COO as part of his March 15, 2007 employment agreement and the issuance of 200,000 stock options to the President and COO as part of the addendum to his March 15, 2007 employment agreement. As a percentage of revenue, stock based compensation increased to 3.9% for the six months ended June 30, 2008 as compared to 1.7% for the six months ended June 30, 2007.

Other Income (Expenses)

Net other income (expenses) was ($1,553,483) for the six months ended June 30, 2008 as compared to ($3,143,079) for the six months ended June 30, 2007. The change was due primarily to a decrease in the change of the fair value of derivative financial instruments of $445,590 and a decrease in interest expense of $1,173,210. Interest expense decreased during the first two quarters of 2008 as a result of the more favorable interest rates under the new senior term notes and subordinated senior term note.

Preferred Stock Dividends

Preferred stock dividends were $991,100 for the six months ended June 30, 2008 as compared to $1,053,700 for the six months ended June 30, 2007. The decrease was due primarily to conversion of 350,000 shares of Series A, 100,000 shares of Series B and 675,000 shares of Series C cumulative preferred stock to common stock during 2008 and 2007.

Three Month Period Ended June 30, 2008 Compared to June 30, 2007

	(Unaudited)						(Unaudited)
	Three Months Ended			% of			Three Months Ended			% of			$ Change			% Change
	June 30, 2008			Revenues			June 30, 2007			Revenues			2008 to 2007			2008 to 2007

Revenues	$	11,761,070			100.0	%	$	10,326,159			100.0	%	$	1,434,911			13.9	%

Operating expenses:
Selling, general and administrative expenses		7,950,968			67.6	%		7,813,720			75.7	%		137,248			1.8	%
Depreciation and amortization		1,889,378			16.1	%		1,715,827			16.6	%		173,551			10.1	%
Stock-based compensation		296,040			2.5	%		114,852			1.1	%		181,188			157.8	%

		10,136,386			86.2	%		9,644,399			93.4	%		491,987			5.1	%

Net operating income		1,624,684			13.8	%		681,760			6.6	%		942,924			138.3	%

Other income (expenses):
Change in fair value of derivative financial instruments		(634,817	)		-5.4	%		(208,345	)		-2.0	%		(426,472	)		204.7	%
Interest expense		(662,183	)		-5.6	%		(1,317,144	)		-12.8	%		654,961			-49.7	%
Interest, dividend and rental income		17,718			0.2	%		16,076			0.2	%		1,642			10.2	%

		(1,279,282	)		-10.9	%		(1,509,413	)		-14.6	%		230,131			-15.2	%

Net income (loss) before deferred income tax benefit		345,402			2.9	%		(827,653	)		-8.0	%		1,173,055			-141.7	%

Deferred income tax benefit		487,982			4.1	%		460,566			4.5	%		27,416			6.0	%

Net income (loss) before preferred stock dividends		833,384			7.1	%		(367,087	)		-3.6	%	$	1,200,471			-327.0	%

Less: preferred stock dividends		(493,700	)					(535,650	)

Net income (loss) available to common stockholders	$	339,684					$	(902,737	)

Net income (loss) per common share - basic	$	0.01					$	(0.03	)

Net income (loss) per common share - diluted	$	0.01					$	(0.03	)

Weighted average common shares outstanding - basic		36,794,000						27,420,000

Weighted average common shares outstanding - diluted		75,065,000						27,420,000

Operating Income (Loss)

Revenues for the three months ended June 30, 2008 increased $1,434,911 to $11,761,070 compared to the three months ended June 30, 2007 as shown on the table above. The increase in revenues and operating expenses were due primarily to revenue generated and costs incurred by firms that were acquired during the first quarter of 2008. In addition, during the quarter ended June 30, 2008, several of our retirement plan administration subsidiaries increased revenues as a result of implementing requirements of the Pension Protection Act of 2006, coupled with organic growth from sales initiatives in our core plan administration business. Operating expenses for the three months ended June 30, 2008 increased $491,987 to $10,136,386 over the prior year's comparable three month period. As a percentage of revenue, operating expenses decreased to 86.2% for the three months ended June 30, 2008 as compared to 93.4% for the three months ended June 30, 2007.

Selling, general and administrative expenses for the three months ended June 30, 2008 increased $137,248 to $7,950,968 over the prior year's comparable three month period. As a percentage of revenue, selling, general and administrative expenses decreased to 67.6% for the three months ended June 30, 2008 as compared to 75.7% for the three months ended June 30, 2007.

Depreciation and amortization for the three months ended June 30, 2008 increased $173,551to $1,889,378 over the prior year's comparable three month period primarily due to amortization of intangible assets acquired in connection with the acquisition of CIAS during the first quarter of 2008. As a percentage of revenue, depreciation and amortization decreased to 16.1% for the three months ended June 30, 2008 as compared to 16.6% for the three months ended June 30, 2007.

Stock-based compensation for the three months ended June 30, 2008 increased $181,188 to $296,040 over the prior year's comparable three month period due primarily to the issuance of 350,000 shares of common stock to the President and COO as part of his March 15, 2007 employment agreement and the issuance of 200,000 stock options to the President and COO as part of the addendum to his March 15, 2007 employment agreement. As a percentage of revenue, stock based compensation increased to 2.5% for the three months ended June 30, 2008 as compared to 1.1% for the three months ended June 30, 2007.

Other Income (Expenses)

Net other income (expenses) was ($1,279,282) for the three months ended June 30, 2008 as compared to ($1,509,413) for the three months ended June 30, 2007. The decrease was primarily due to a decrease in interest expense of $654,961 and an increase in interest and rental income of 1,642, offset by an increase in the change of the fair value of derivative financial instruments of $426,472. Interest expense decreased as a result of the more favorable interest rates under the new senior term notes and subordinated senior term note.

Preferred Stock Dividends

Preferred stock dividends were $493,700 for the three months ended June 30, 2008 as compared to $535,650 for the three months ended June 30, 2007. The decrease was due primarily to conversion of 100,000 shares of Series A, 100,000 shares of Series B and 675,000 shares of Series C cumulative preferred stock to common stock during the first quarter 2008 and the second half of 2007.

Liquidity and Capital Resources:

Our cash, working capital (deficit) and stockholders' equity position is disclosed below:

	(Unaudited)			(Audited)
	June 30, 2008			December 31, 2007
Unrestricted Cash	$	2,027,898		$	3,254,759
Working Capital (deficit)	$	(7,514,791	)	$	(3,994,816	)
Stockholders' Equity	$	13,746,296		$	14,046,996

At June 30, 2008 and December 31, 2007, the Company's working capital deficit was approximately $7.5 million and $4.0 million, respectively and its accumulated deficit was approximately $20.3 million and $19.0 million, respectively. For the six months ended June 30, 2008 and June 30, 2007, the Company's net losses before preferred stock dividends were approximately $0.3 million and $3.5 million, respectively and its cash flows from operations were approximately $2.5 million and $1.3 million, respectively. Based upon management's current forecast of future revenues from its acquired businesses, its recent history of capital raising and other factors, the Company believes its cash resources will be adequate to support its acquisition model and fund operations in 2008.

Details of the changes in cash flows during the six month periods ended June 30, 2008 and 2007 are as follows:

	(Unaudited)			(Unaudited)
	Six Months Ended			Six Months Ended
	June 30, 2008			June 30, 2007
Net cash provided by operating activities	$	2,511,533		$	1,255,255

Cash flows from investing activities:
Purchases of property and equipment		(134,319	)		(162,224	)
Acquisition of Alaska Pension Services, Ltd.		(729,408	)		-
Acquisition of National Actuarial Pension Services, Inc.		(21,623	)		-
Acquisition of Benefit Dynamics		(8,770	)		(340,000	)
Acquisition of Pentec and Pentec Capital Management		(40,246	)		(1,691,376	)
Acquisition of The Pension Alliance		(141,055	)		(3,380,000	)
Acquisition of California Investment and Annuity Services		(1,521,623	)		-

Net cash used in investing activities		(2,597,044	)		(5,573,600	)

Cash flows from financing activities:
Payments on long-term debt and notes		(1,107,532	)		(454,174	)
Proceeds from sale of common and preferred shares, net		-			1,150,219
Payment of deferred financing costs		(33,818	)		-

Net cash provided by (used in) financing activities		(1,141,350	)		696,045

Net decrease in cash		(1,226,861	)		(3,622,300	)

Cash, beginning of period		3,254,759			6,191,301

Cash, end of period	$	2,027,898		$	2,569,001

The Company had unrestricted cash as of June 30, 2008 of $2,027,898, a decrease of $1,226,861 from December 31, 2007.

Net cash provided by operating activities of $2,511,533 was primarily due to non-cash expenses of $4,210,233, a decrease in prepaid expenses of $78,608 and an increase in unearned revenue of $216,835, offset by a net loss of $336,663, an increase in accounts receivables of $1,305,333, a decrease in accrued expenses and current liabilities of $143,221, and a decrease in accounts payable of $208,926.

The non-cash items were primarily composed of depreciation and amortization of $3,628,766, noncash interest of $375,122, stock-based compensation of $807,064, and an increase in the fair value of derivative securities of $258,660, offset by a decrease in the deferred tax liability of $859,379.

Net cash of $2,597,044 used in investing activities was due to $2,251,031 in funds expended in the acquisitions of Alaska Pension Services Ltd and California Investment and Annuity Services, $211,694 in funds expended in contingency payments for National Actuarial Pension Services, Inc., Benefit Dynamics, Pentec and Pentec Capital Management, and The Pension Alliance and $134,319 used in the purchase of property and equipment.

Net cash of $1,141,350 used in financing activities was due to $1,107,532 in payments of long-term debt (primarily seller notes) and $33,818 in the payment of deferred financing costs.

The Company had unrestricted cash as of June 30, 2007 of $2,569,001 a decrease of $3,622,300 from December 31, 2006.

Net cash provided by operating activities of $1,255,255 was primarily due to non-cash items of $4,274,847, an increase in unearned revenues of $1,059,018, an increase in accrued expenses and current liabilities of $260,517, offset by a net loss of $3,524,677, an increase in accounts receivable of $704,797, an increase in prepaid expenses of $100,788, and a decrease in accounts payable of $8,864.

The non-cash items were primarily composed of depreciation and amortization of $3,271,053, noncash interest of $649,360, stock-based compensation of $285,507, stock issued for services of $42,002, and an increase in the fair value of derivative securities of $704,250 offset by a decrease in the deferred tax liability of $677,325.

Net cash of $5,573,600 used in investing activities was due to $5,411,376 of funds expended in the acquisitions of Benefit Dynamics, Pentec and Pentec Capital Management and The Pension Alliance and $162,224 used in the purchase of property and equipment.

Net cash of $696,045 provided by financing activities was primarily due to the receipt of $1,150,219 of net proceeds from our Series E Preferred Stock Offering and $454,174 in payments of long-term debt.

Seller Financing

In connection with our acquisition strategy, part of the purchase price is paid through seller financed instruments. As part of the acquisition of CIAS, we issued the Sellers promissory notes for an aggregate of $950,000 with the first promissory notes in the amount of $475,000 payable June 3, 2009 and the second promissory notes in the amount of $475,000 payable June 3, 2010. As part of the acquisition of Alaska Pension, we issued the Sellers promissory notes for an aggregate of $220,000 with the first promissory notes in the amount of $110,000 payable August 31, 2009 and the second promissory notes in the amount of $110,000 payable August 31, 2010. In the event that certain EBITDA targets are not achieved by CIAS and Alaska Pension during the 24 months following the closing date, the convertible promissory notes will be reduced by the amount of such shortfall.

Future Contractual Obligations

The following table shows the Company's present and future contractual obligations as of June 30, 2008:

	(Unaudited)
	June 30, 2008
	Payments due by period
	Total		Less than 1 year		1-3 years		3-5 years

Operating Lease Obligations	$	6,321,388	$	1,848,499	$	3,154,239	$	1,318,650

Employment Contracts	$	1,803,333	$	1,370,000	$	433,333	$	-

Revolving Line of Credit	$	1,000,000	$	1,000,000	$	-	$	-

Short and Long Term Debt	$	24,848,301	$	4,285,676	$	20,562,625	$	-

Total Contractual Cash Obligations	$	33,973,022	$	8,504,175	$	24,150,197	$	1,318,650

Critical Accounting Policies and Estimates

We believe the following critical accounting policies affect the significant judgments and estimates used in the preparation of our financial statements:

	·	Revenue Recognition
	·	Management's Estimates
	·	Goodwill / Intangible Assets
	·	Share-based Payments

Revenue Recognition

We generate revenue primarily from the following three sources:

	·	Third party administration;
	·	Financial planning and investment advisory fees and securities commissions;
	·	Insurance commissions.

The Company recognizes revenue from these sources, as follows:

Third party administration:

	·	Persuasive evidence of an arrangement between the Company and its clients exists;
	·	Delivery of the product to the customer has occurred or service has been provided to the customer;
	·	The price to the customer is fixed and determinable;
	·	Collectability of the sales price is reasonably assured.

Financial planning and investment advisory fees and securities:

	·	As services are rendered;
	·	Contingent commissions are recorded as revenue is earned.

Insurance:

	·	The policy application is substantially complete;
	·	The premium is paid;
	·	The insured party is contractually committed to the purchase of the insurance policy.

Management's Estimates

The discussion and analysis of our financial condition and results of operations are based upon our condensed consolidated interim financial statements which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of these condensed consolidated interim financial statements requires management to make estimates and judgments that affect the reported amounts of assets, liabilities and related disclosure of contingent assets and liabilities at the date of the condensed consolidated interim financial statements and the reported amounts for revenues and expenses during the reporting period. On an ongoing basis, management evaluates estimates, including those related to allowances for doubtful accounts, as described above, income taxes, bad debts, and contingencies. We base our estimates on historical data, when available, experience, and on various other assumptions that are believed to be reasonable under the circumstances, the combined results of which form the basis for making judgments approximating the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates.

Inflation

While inflation has not had a material effect on our operations in the past, there can be no assurance that we will be able to continue to offset the effects of inflation on the costs of our services through price increases to our clients without experiencing a reduction in the demand for our services; or that inflation will not have an overall effect on the retirement market that would have a material effect on us.

Special Note Regarding Forward Looking Statements

This quarterly report contains forward-looking statements as that term is defined in the federal securities laws. The events described in forward-looking statements contained in this Quarterly Report may not occur. Generally, these statements relate to business plans or strategies, projected or anticipated benefits or other consequences of our plans or strategies, projected or anticipated benefits from acquisitions to be made by us, or projections involving anticipated revenues, earnings or other aspects of our operating results. The words "may," "will," "expect," "believe," "anticipate," "project," "plan," "intend," "estimate," and "continue," and their opposites and similar expressions are intended to identify forward-looking statements. We caution you that these statements are not guarantees of future performance or events and are subject to a number of uncertainties, risks and other influences (including, but not limited to, those set forth in our Form 10-KSB), many of which are beyond our control, that may influence the accuracy of the statements and the projections upon which the statements are based. Any one or more of these uncertainties, risks and other influences could materially affect our results of operations and whether forward looking statements made by us ultimately prove to be accurate. Our actual results, performance and achievements could differ materially from those expressed or implied in these forward-looking statements. We undertake no obligation to publicly update or revise any forward-looking statements, whether from new information, future events or otherwise.

Adoption of New Accounting Pronouncements

New Accounting Pronouncements

ITEM 3. Quantitative and Qualitative Disclosures about Market Risks

General economic and market factors, such as changes in interest rates or declines or significant volatility in the securities markets, will affect our commission and fee income. These factors can affect the volume of new investment sales and the extent to which clients keep their investments and maintain funds in accounts we manage. Equity returns and interest rates can have a significant effect on the sale of many employee benefit programs whether they are financed by life insurance or other financial instruments. For example, if interest rates increase, competing products offering higher returns could become more attractive to potential purchasers than the programs and policies we market and distribute. Further, a decrease in stock prices can have a significant effect on the sale of financial services products that are linked to the stock market, such as variable life insurance, variable annuities, mutual funds and managed accounts. In addition, a portion of our earnings are derived from fees, typically based on a percentage of assets under management, for offering financial advice and related services to clients. A decrease in stock prices would reduce fees that are based on a percentage of assets under management. Furthermore, we earn recurring commission revenue on certain products over a period after the initial sale, provided the customer retains the product. These factors may lead customers to surrender or terminate their products, ending these recurring revenues. A portion of our earnings are derived from commissions and override payments from manufacturers of financial services products that are based on the volume and profitability of business generated by us. If investors seek alternatives to our investment advice and services or to our insurance products and services, it could have a negative impact on our revenue. We cannot guarantee that we will be able to compete with alternative products if these market forces make our products and services unattractive to clients. Finally, adverse general economic conditions may cause potential customers to defer or forgo the purchase of products that we sell, for example investing more defensively or surrendering products to increase personal cash flow.

ITEM 4. Controls and Procedures

Not Applicable

ITEM 4T. Controls and Procedures

Managements Report on Internal Control Over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rules 13a-15(f) and 15d-15(f) under the Securities Exchange Act of 1934. Our internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles and includes those policies and procedures that:

	·	Pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of our assets;
	·	Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with U.S. generally accepted accounting principles, and that our receipts and expenditures are being made only in accordance with authorizations of management and directors; and
	·	Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. All internal control systems, no matter how well designed, have inherent limitations and provide only reasonable assurance, not absolute assurance, with respect to financial statement preparation and presentation. The design of an internal control system reflects resource constraints and the benefits must be considered relative to the costs of implementing and maintaining the system.

Our management assessed the effectiveness of our internal controls over financial reporting as of December 31, 2007. Based on our assessment, management concluded that the Company did not maintain effective internal control over financial reporting during 2007. During the course of our assessment, we noted the data of three of our subsidiaries is residing on a shared network supported by a related party of the Company.

In connection with its 2007 assessment, management began implementing a plan in 2008 to remediate the noted material weakness.

Except as noted above, there have been no changes in our internal control over financial reporting as defined in Rules 13a-15(f) and 15d-15(e) under the Securities Exchange Act of 1934 during the quarter ended June 30, 2008 that materially affected, or are reasonably likely to materially affect our internal control over financial reporting.

PART II. OTHER INFORMATION

ITEM 1. Legal Proceedings

From time to time, the Company may become a party to litigation or other legal proceedings that it considers to be a part of the ordinary course of its business. The Company is not involved currently in legal proceedings that could reasonably be expected to have a material adverse effect on its business, prospects, financial condition or results of operations. The Company may become involved in material legal proceedings in the future.

ITEM 1A. Risk Factors

As a “Smaller Reporting Company” as defined by Item 10 of Regulation S-K, the Company is not required to provide information required by this item.

ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds

Unregistered Sales of Equity Securities

January 2, 2008

On November 30, 2007 the Company entered into an employment agreement with Steve Ross pursuant to which he was issued 700,000 shares of restricted common stock of the Company on January 2, 2008. The issuance of the shares to Mr. Ross was deemed to be exempt under section 4(2) of the Securities Act of 1933, as amended.

March 10, 2008

On March 10, 2008, a holder of 100,000 shares of Series B Convertible Preferred Stock converted those share into 200,000 shares of common stock. The issuance of the shares was deemed to be exempt under section 4(2) of the Securities Act of 1933, as amended.

April 17, 2008

As part of an employment agreement entered into with John Davis on March 15, 2007, Mr. Davis received 350,000 shares of restricted common stock of the Company on April 17, 2008 based on the Company’s attainment of certain earnings before interest, taxes, depreciation, amortization and stock based compensation (“EBITDA SBC”) targets and management objectives. The issuance of the shares to Mr. Davis was deemed to be exempt under section 4(2) of the Securities Act of 1933, as amended.

April 18, 2008

As part of the addendum to the March 15, 2007 employment agreement with John Davis, the Company issued a Stock Option Agreement on April 18, 2008 granting Mr. Davis the option to purchase 200,000 shares of restricted common stock of the Company at a price of $0.61 per share.

June 30, 2008

In connection with the acquisition of 100% of the outstanding shares of Alaska Pension, the Company issued 369,128 shares of common stock valued at $220,000. The issuance of the shares to Karen Jordan and Duane Mayer was deemed to be exempt under section 4(2) of the Securities Act of 1933, as amended.

ITEM 3. Defaults Upon Senior Securities

None.

ITEM 4. Submission of Matters to a Vote of Security Holders

None.

ITEM 5. Other Information

In April 2008, the Company extended the employment agreement of Mr. Davis, the Company's President and Chief Operating Officer. The addendum to his March 15, 2007 employment agreement provides for a term through March 31, 2009. All terms of his March 21, 2007 employment agreement remain the same except for 1) a $25,000 increase in annual salary; 2) an option grant to purchase 200,000 shares of restricted common stock of the Company at $0.61 per share of which 100,000 shares will vest on September 30, 2008 and 100,000 shares will vest on March 31, 2009; and 3) an additional bonus of $100,000 upon attainment of certain adjusted EBITDA SBC targets for the trailing 12 months at June 30, 2008, or comparable enterprise valuation, or eligible change in control.

ITEM 6. Exhibits

Exhibit Number	Description
3.1	Articles of Incorporation of the Company, as amended (Incorporated by reference to Form S-18 filed with the Securities and Exchange Commission on October 7, 1985))

3.2	Amended and Restated Bylaws of the Company (Incorporated by reference to Form 8-K_filed with the Securities and Exchange Commission on April 19, 2005. (File No.333-124161))

3.3	Certificate of Designation of Preferences, Rights and Limitations of Series B Cumulative Convertible Preferred Stock (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on October 19, 2005. (File No.000-51252))

3.4	Certificate of Designation of Preferences, Rights and Limitations of Series C Cumulative Convertible Preferred Stock (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on November 14, 2005. (File No.000-51252))

3.5	Articles of Amendment to the Articles of Incorporation dated August19, 2004 (Incorporated by reference to Form SB-2 filed with the Securities and Exchange Commission on November 21, 2006 (File No. 333-136790))

3.6	Articles of Amendment to the Articles of Incorporation dated March 2, 2005 (Incorporated by reference to Form SB-2 filed with the Securities and Exchange Commission on November 21, 2006 (File No. 333-136790))

3.7	Articles of Amendment to the Articles of Incorporation dated March 15, 2005 (Incorporated by reference to Form SB-2 filed with the Securities and Exchange Commission on November 21, 2006 (File No. 333-136790))

3.8	Articles of Amendment to the Articles of Incorporation dated March 21, 2005 (Incorporated by reference to Form SB-2 filed with the Securities and Exchange Commission on November 21, 2006 (File No. 333-136790))

3.9	Certificate of Designation of Preferences, Rights and Limitations of Series D Cumulative Convertible Preferred Stock (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on March 27, 2006. (File No. 002-98138-A))

3.10	Certificate of Designation of Preferences, Rights and Limitations of Series E Cumulative Convertible Preferred Stock (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on December 26, 2006. (File No. 002-98138-A))

4.1	Securities Purchase Agreement dated March 9, 2005 by and between the Company and Laurus Master Fund, Ltd. (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on March 15, 2005. (File No. 002-98138-A))

4.2	Secured Convertible Term Note dated March 9, 2005 issued by the Company to Laurus Master Fund, Ltd. (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on March 15, 2005. (File No. 002-98138-A))

4.3	Secured Convertible Term Note dated March 9, 2005 issued by the Company to Laurus Master Fund, Ltd. (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on March 15, 2005. (File No. 002-98138-A))

4.4	Common Stock Option dated March 9, 2005 issued by the Company to Laurus Master Fund, Ltd. (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on March 15, 2005. (File No. 002-98138-A))

4.5	Master Security Agreement dated March 9, 2005 among Fast Eddie Racing Stables, Inc., Duncan Capital Financial Group, Inc., Pension Administration Services, Inc., Complete Investment Management Inc. of Philadelphia, MD Bluestein, Inc. and Laurus Master Fund, Ltd .(Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on March 15, 2005. (File No. 002-98138-A))

4.6	Stock Pledge Agreement dated March 9, 2005 among Fast Eddie Racing Stables, Inc., Duncan Capital Financial Group, Inc., Pension Administration Services, Inc., Complete Investment Management Inc. of Philadelphia, MD Bluestein, Inc. and Laurus Master Fund, Ltd.(Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on March 15, 2005. (File No. 002-98138-A))

4.7	Subsidiary Guaranty dated March 9, 2005 executed by Duncan Capital Group, Inc., Pension Administration Services, Inc., Complete Investment Management Inc. of Philadelphia, MD Bluestein, Inc. and Laurus Master Fund, Ltd. (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on March 15, 2005. (File No. 002-98138-A))

4.8	Registration Rights Agreement dated March 9, 2005 by and between Fast Eddie Racing Stables, Inc. and Laurus Master Fund, Ltd. (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on March 15, 2005. (File No. 002-98138-A))

4.9	Common Stock Purchase Warrant dated March 9, 2005 issued by Duncan Capital Financial Group, Inc. to Richard E. Stierwalt. (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on March 15, 2005. (File No. 002-98138-A))

4.10	Common Stock Purchase Warrant dated March 9, 2005 issued by Duncan Capital Financial Group, Inc. to Leonard Neuhaus. (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on March 15, 2005. (File No. 002-98138-A))

4.11	Form of Stock Option Agreement, dated March 9, 2005, between the Company and certain non-management directors. (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on April 19, 2005.))

4.12	Securities Purchase Agreement dated November 30, 2005 entered by and between National Investment Mangers Inc. and Laurus Master Fund, Ltd. (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on December 6, 2005. (File No.000-51252))

4.13	Securities Purchase Agreement dated November 30, 2005 entered by and between National Investment Mangers Inc. and Laurus Master Fund, Ltd. (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on December 6, 2005. (File No.000-51252))

4.14	Securities Purchase Agreement dated November 30, 2005 entered by and between National Investment Mangers Inc. and Laurus Master Fund, Ltd. (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on December 6, 2005. (File No.000-51252))

4.15	Convertible Promissory Note, dated August 2, 2005, issued by the Company to Stephen H. Rosen. (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on August 5, 2005.(File No.000-51252))

4.16	Convertible Promissory Note, dated August 2, 2005, issued by the Company to Elizabeth Davies. (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on August 5, 2005. (File No.000-51252))

4.17	Common Stock Option, dated August 2, 2005, issued by the Company to Stephen H. Rosen. (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on August 5, 2005. (File No.000-51252))

4.18	Common Stock Option, dated August 2, 2005, issued by the Company to Stephen H. Rosen. (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on August 5, 2005. (File No.000-51252))

4.19	Form of Subscription Agreement for Series B Cumulative Convertible Preferred Stock (Incorporated by reference to the Form 8-K Current Report filed with the Securities and Exchange Commission on October 20, 2005 (File No.000-51252))

4.20	Form of Subscription Agreement for Series C Cumulative Convertible Preferred Stock (Incorporated by reference to the Form 8-K Current Report filed with the Securities and Exchange Commission on November 14, 2005 (File No.000-51252))

4.21	Amendment Agreement entered by and between the Company and Laurus Master Fund Ltd. dated August 2006

4.22	Securities Purchase Agreement dated May 30, 2006 by and between National Investment Managers Inc. and Laurus Master Fund, Ltd. (Incorporated by reference to the Form 8-K Current Report filed with the Securities and Exchange Commission on June 5, 2006 (File No.000-51252))

4.23	Secured Non-Convertible Term Note payable to Laurus Master Fund, Ltd. (Incorporated by reference to the Form 8-K Current Report filed with the Securities and Exchange Commission on June 5, 2006 (File No.000-51252))

4.24	Secured Non-Convertible Term Note payable to Laurus Master Fund, Ltd. (Incorporated by reference to the Form 8-K Current Report filed with the Securities and Exchange Commission on June 5, 2006 (File No.000-51252))

4.25	Registration Rights Agreement dated May 30, 2006 by and between National Investment Managers Inc. and Laurus Master Fund, Ltd. (Incorporated by reference to the Form 8-K Current Report filed with the Securities and Exchange Commission on June 5, 2006 (File No.000-51252))

4.26	Letter Agreement dated May 30, 2006 by and between National Investment Managers Inc. and Laurus Master Fund, Ltd. (Incorporated by reference to the Form 8-K Current Report filed with the Securities and Exchange Commission on June 5, 2006 (File No.000-51252))

4.27	Amendment dated May 30, 2006 by and between National Investment Managers Inc. and Laurus Master Fund, Ltd. (Incorporated by reference to the Form 8-K Current Report filed with the Securities and Exchange Commission on June 5, 2006 (File No.000-51252))

4.28	Agreement dated June 14, 2006 by and between National Investment Managers Inc. and Laurus Master Fund, Ltd. (Incorporated by reference to the Form 8-K Current Report filed with the Securities and Exchange Commission on June 16, 2006 (File No.000-51252))

4.29	Common Stock Purchase Warrant dated May 30, 2006 issued to Laurus Master Fund, Ltd. (Incorporated by reference to the Form 8-K Current Report filed with the Securities and Exchange Commission on June 16, 2006 (File No.000-51252))

4.30	Letter from Laurus Master Fund, Ltd. to National Investment Managers Inc., dated June 14, 2006 (Incorporated by reference to the Form 8-K Current Report filed with the Securities and Exchange Commission on June 16, 2006 (File No.000-51252))

4.31	Form of Subscription Agreement for Series D Cumulative Convertible Preferred Stock (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on March 27, 2006. (File No. 002-98138-A))

4.32	Form of Common Stock Purchase Warrant (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on March 27, 2006. (File No. 002-98138-A))

4.33	Form of Common Stock Purchase Warrant (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on March 27, 2006. (File No. 002-98138-A))

4.34	Form of Common Stock Purchase Warrant (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on December 26, 2006. (File No. 002-98138-A))

4.35	Revolving Line of Credit and Term Loan Agreement by and between National Investment Managers Inc. and RBS Citizens, National Association dated November 30, 2007 (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on December 4, 2007. (File No. 000-51252))

4.36	Revolving Line of Credit Note issued by National Investment Managers Inc. issued to RBS Citizens, National Association dated November 30, 2007 (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on December 4, 2007. (File No. 000-51252))

4.37	Term Promissory Note issued by National Investment Managers Inc. issued to RBS Citizens, National Association dated November 30, 2007 (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on December 4, 2007. (File No. 000-51252))

4.38	Stock Pledge Agreement by and between National Investment Managers Inc. and RBS Citizens, National Association dated November 30, 2007 (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on December 4, 2007. (File No. 000-51252))

4.39	Security Agreement by and between National Investment Managers Inc. and RBS Citizens, National Association dated November 30, 2007 (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on December 4, 2007. (File No. 000-51252))

4.40	Form of Stock Pledge Agreement by and between the subsidiaries of National Investment Managers Inc. and RBS Citizens, National Association dated November 30, 2007 (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on December 4, 2007. (File No. 000-51252)

4.41	Form of Security Agreement by and between the subsidiaries of National Investment Managers Inc. and RBS Citizens, National Association dated November 30, 2007 (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on December 4, 2007. (File No. 000-51252))

4.42	Form of Guaranty by and between the subsidiaries of National Investment Managers Inc. and RBS Citizens, National Association dated November 30, 2007 (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on December 4, 2007. (File No. 000-51252))

4.43	Securities Purchase and Loan Agreement by and between National Investment Managers Inc. and Woodside Capital Partners IV, LLC, Woodside Capital Partners IV QP, LLC, Lehman Brothers Commercial Bank and Woodside Agency Services, LLC, as collateral agent, dated November 30, 2007 (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on December 4, 2007. (File No. 000-51252))

4.44	Securities Purchase and Loan Agreement by and between National Investment Managers Inc. and Woodside Capital Partners IV, LLC, Woodside Capital Partners IV QP, LLC, Lehman Brothers Commercial Bank and Woodside Agency Services, LLC, as collateral agent, dated November 30, 2007 (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on December 4, 2007. (File No. 000-51252))

4.45	Form of Warrant exercisable at $0.50 per share issued by National Investment Managers Inc. to Woodside Capital Partners IV, LLC, Woodside Capital Partners IV QP, LLC, and Lehman Brothers Commercial Bank dated November 30, 2007 (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on December 4, 2007. (File No. 000-51252))

4.46	Form of Warrant exercisable at $1.00 per share issued by National Investment Managers Inc. to Woodside Capital Partners IV, LLC, Woodside Capital Partners IV QP, LLC, and Lehman Brothers Commercial Bank dated November 30, 2007 (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on December 4, 2007. (File No. 000-51252))

4.47	Form of Warrant exercisable at $1.50 per share issued by National Investment Managers Inc. to Woodside Capital Partners IV, LLC, Woodside Capital Partners IV QP, LLC, and Lehman Brothers Commercial Bank dated November 30, 2007 (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on December 4, 2007. (File No. 000-51252))

4.48	Registration Rights Agreement by and between National Investment Managers Inc. and Woodside Capital Partners IV, LLC, Woodside Capital Partners IV QP, LLC, and Lehman Brothers Commercial Bank dated November 30, 2007 (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on December 4, 2007. (File No. 000-51252))

4.49	Contingent Interest Payment Agreement by and between National Investment Managers Inc. and Woodside Capital Partners IV, LLC, Woodside Capital Partners IV QP, LLC, and Lehman Brothers Commercial Bank dated November 30, 2007 (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on December 4, 2007. (File No. 000-51252))

4.50	Fee Agreement by and between National Investment Managers Inc. and Woodside Capital Partners IV, LLC, Woodside Capital Partners IV QP, LLC, and Lehman Brothers Commercial Bank dated November 30, 2007 (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on December 4, 2007. (File No. 000-51252))

4.51	Fee Agreement by and between National Investment Managers Inc. and Woodside Capital Partners IV, LLC, Woodside Capital Partners IV QP, LLC, and Lehman Brothers Commercial Bank dated November 30, 2007 (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on December 4, 2007. (File No. 000-51252))

4.52	Security Agreement by and between National Investment Managers Inc., its subsidiaries and Woodside Agency Services, LLC dated November 30, 2007 (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on December 4, 2007. (File No. 000-51252))

4.53	Guaranty by and between National Investment Managers Inc., its subsidiaries and Woodside Agency Services, LLC dated November 30, 2007 (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on December 4, 2007. (File No. 000-51252))

4.54	Securities Purchase Agreement by and between National Investment Managers Inc. and Valens U.S. SPV I, LLC and Valens Offshore SPV I, Ltd. (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on December 4, 2007. (File No. 000-51252))

4.55	Amendment No., 1 to Revolving Line of Credit and Term Loan Agreement by and between Citizens RBS, National Association, and National Investment Managers Inc. (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on April 8, 2008 (File No. 000-51252))

4.56	Consent and Amendment No. 1 to Securities Purchase and Loan Agreement by and among National Investment Managers Inc., Woodside Capital Partners IV, LLC, Woodside Capital Partners IV QP, LLC, Lehman Brothers Commercial Bank and Woodside Agency Services, LLC as collateral agent (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on April 8, 2008 (File No. 000-51252))

4.57	Amendment No., 4 to Revolving Line of Credit and Term Loan Agreement by and between Citizens RBS, National Association, and National Investment Managers Inc.

4.58	Amendment No. 4 to Intercreditor and Subordination Agreement by and between RBS Citizens, National Association, and National Investment Managers Inc.

10.1	Agreement and Plan of Reorganization, dated as of February 18, 2005 by and among Fast Eddie Racing Stables, Inc, Glenn A. Little, Duncan Capital Financial Group, Inc. and FERS Acquisition Corp. (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on February 23, 2005)

10.2	Employment Agreement, dated as of December 23, 2004, between Duncan Capital Financial Group, Inc. and Richard E. Stierwalt. (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on March 15, 2005)

10.3	Employment Agreement, dated as of January 1, 2005, between Duncan Capital Financial Group, Inc. and Leonard Neuhaus. (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on March 15, 2005)

10.4	12% Senior Secured Note, dated January 27, 2005, in the original principal amount of $350,000, delivered by Duncan Capital Financial Group, Inc. to CAMOFI Master LDC (formerly known as DCOFI Master LDC) (Incorporated by reference to Form SB-2 Registration Statement filed with the Securities and Exchange Commission on April 19, 2005. (File No.333-124161))

10.5	Securities Purchase Agreement, dated as of January 27, 2005, between Duncan Capital Financial Group, Inc. and CAMOFI Master LDC(Incorporated by reference to Form SB-2 filed with the Securities and Exchange Commission on April 19, 2005. (File No.333-124161))

10.6	Security Agreement, dated as of January 27, 2005, among Duncan Capital Financial Group, Inc., Pension Administration Services, Inc., Complete Investment Management Inc. of Philadelphia, MD Bluestein Inc. and CAMOFI Master LDC. (Incorporated by reference to Form SB-2_filed with the Securities and Exchange Commission on April 19, 2005. (File No.333-124161))

10.7	Subsidiary Guarantee, dated as of January 27, 2005, among Duncan Capital Financial Group, Inc., Pension Administration Services, Inc., Complete Investment Management Inc. of Philadelphia and MD Bluestein Inc. in favor of CAMOFI Master LDC. (Incorporated by reference to Form SB-2/A_filed with the Securities and Exchange Commission on June 17, 2005. (File No.333-124161))

10.8	12% Senior Secured Note, dated May 4, 2005, in the original principal amount of $150,000, delivered by Duncan Capital Financial Group, Inc. to CAMOFI Master LDC. (Incorporated by reference to Form SB-2/A_filed with the Securities and Exchange Commission on June 17, 2005. (File No.333-124161))

10.9	Agreement, dated as of June 15, 2005, between the Company and Richard Berman. (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on June 17, 2005.)

10.10	Asset Purchase Agreement between National Investment Mangers Inc. and American Benefit Resources, Inc. dated November 1, 2005 (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on November 4, 2005. (File No.000-51252))

10.11	A/R Escrow Agreement by and among National Investment Mangers Inc., JP Morgan Chase Bank, N.A. and American Benefit Resources, Inc. dated November 30, 2005 (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on December 6, 2005. (File No.000-51252)

10.12	Indemnification Escrow Agreement by and among National Investment Mangers Inc., JP Morgan Chase Bank, N.A. and American Benefit Resources, Inc. dated November 30, 2005 (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on December 6, 2005. (File No.000-51252)

10.13	Registration Rights Agreement between National Investment Mangers Inc., American Benefit Resources, Inc. and Arthur J. Steinberg as manager of IBF Fund Liquidating LLC dated November 30, 2005 (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on December 6, 2005. (File No.000-51252))

10.14	Stock Purchase Agreement, dated August 2, 2005, among the Company, Stephen H. Rosen Associates, Inc., Stephen H. Rosen and Elizabeth Davies. (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on August 5, 2005. (File No.000-51252))

10.15	Stock Purchase Agreement, dated August 2, 2005, among the Company, Haddon Strategic Alliances, Inc. and John Ermilio. (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on August 5, 2005. (File No.000-51252))

10.16	Employment Agreement, dated as of August 2, 2005, between the Company and Stephen H. Rosen. (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on August 5, 2005. (File No.000-51252))

10.17	Noncompetition Agreement, dated as of August 2, 2005, between the Company and Stephen H. Rosen. (Incorporated by reference to Form 8-Kfiled with the Securities and Exchange Commission on August 5, 2005 (File No.000-51252))

10.18	Noncompetition Agreement, dated as of August 2, 2005, between the Company and John Ermilio. (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on August 5, 2005. (File No.000-51252))

10.19	Agreement and Plan of Merger Dated as of January 4, 2006 by and among Jack C. Holland, Steven R. Eyer, Valley Forge Enterprises, Ltd., VFE Merger Corp. and National Investment Managers Inc. (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on January 12, 2006. (File No.000-51252))

10.20	Employment Agreement dated January 1, 2006 by and between Steven R. Eyer and Valley Forge Enterprises, Ltd (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on January 12, 2006. (File No.000-51252))

10.21	Employment Agreement dated January 1, 2006 by and between Jack C. Holland and Valley Forge Enterprises, Ltd. (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on January 12, 2006. (File No.000-51252))

10.22	Non-Competition, Non-Disclosure and Non-Solicitation Agreement dated January 1, 2006 by and between Steven R. Eyer and National Investment Managers Inc. (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on January 12, 2006. (File No.000-51252))

10.23	Non-Competition, Non-Disclosure and Non-Solicitation Agreement dated January 1, 2006 by and between Jack C. Holland and National Investment Managers Inc. (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on January 12, 2006. (File No.000-51252))

10.24	Employment Agreement dated March 1, 2006 by and between Leonard Neuhaus and the Company (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on March 6, 2006. (File No.000-51252)

10.25	Consulting Agreement dated March 1, 2006 by and between Richard Stierwalt and the Company (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on March 6, 2006. (File No.000-51252))

10.26	Employment Agreement dated March 2006 by and between Steven Ross and the Company (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on March 17, 2006.)

10.27	Consulting Agreement dated January 1, 2006 by and between DC Associates LLC and the Company (Incorporated by reference to Form 10-KSB filed with the Securities and Exchange Commission on March 31, 2006.)

10.28	Put Agreement entered by and among American Benefit Resources, Inc., IBF Fund Liquidating LLC and Duncan Capital Group LLC

10.29	Put Agreement entered by and among American Benefit Resources, Inc., BF Fund Liquidating LLC and Duncan Capital Group LLC

10.30	Stock Purchase Agreement by and between National Investment Managers Inc., THE LAMCO Group, Inc., Lamoriello & Co., Inc., Circle Pension, Inc., Southeastern Pension Services, Inc. and Nicholas J. Lamoriello (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on October 10, 2006. (File No. 000-51252))

10.31	Stock Option issued to Nicholas J. Lamoriello (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on October 10, 2006. (File No. 000-51252))

10.32	Escrow Agreement entered by and between National Investment Managers Inc. and THE LAMCO Group, Inc. (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on October 10, 2006. (File No. 000-51252))

10.33	Cross Sales Agreement entered between National Investment Managers Inc. and THE LAMCO Group, Inc. (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on October 10, 2006. (File No. 000-51252))

10.34	Technology Agreement entered between National Investment Managers Inc. and THE LAMCO Group, Inc. (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on October 10, 2006. (File No. 000-51252))

10.35	Management entered between National Investment Managers Inc., Nicholas J. Lamoriello and Stephen R. Zito (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on October 10, 2006. (File No. 000-51252))

10.36	Non-Competition, Non-Disclosure and Non-Solicitation Agreement between National Investment Managers Inc., Nicholas J. Lamoriello and THE LAMCO Group, Inc. (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on October 10, 2006. (File No. 000-51252))

10.37	Joinder Agreement between Laurus Master Fund, Ltd., Lamoriello & Co. Inc., Circle Pension, Inc., and Southeastern Pension Services, Inc. (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on October 10, 2006. (File No. 000-51252))

10.38	Employment Agreement dated October 24, 2006 by and between Steven Ross and the Company. (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on October 26, 2006. (File No. 000-51252))

10.39	Stock Purchase Agreement by and between National Investment Managers Inc., National Actuarial Pension Services, Inc., Charles McLeod and Mary H. McLeod (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on December 4, 2006. (File No. 000-51252))

10.40	Promissory Note issued by National Investment Managers Inc. to Charles McLeod and Mary H. McLeod (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on December 4, 2006. (File No. 000-51252))

10.41	Promissory Note issued by National Investment Managers Inc. to Charles McLeod and Mary H. McLeod (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on December 4, 2006. (File No. 000-51252)

10.42	Promissory Note issued by National Investment Managers Inc. to Charles McLeod and Mary H. McLeod (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on December 4, 2006. (File No. 000-51252))

10.43	Employment Agreement entered between National Investment Managers Inc. and Mary McLeod (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on December 4, 2006. (File No. 000-51252))

10.44	Non-Competition, Non-Disclosure and Non-Solicitation Agreement between National Investment Managers Inc. and Charles McLeod and Mary H. McLeod. (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on December 4, 2006. (File No. 000-51252))

10.45	Joinder Agreement between Laurus Master Fund, Ltd. and National Actuarial Pension Services, Inc. (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on December 4, 2006. (File No. 000-51252))

10.46	Joinder Agreement between Laurus Master Fund, Ltd. and National Actuarial Pension Services, Inc. (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on December 4, 2006. (File No. 000-51252))

10.47	Agreement between National Investment Managers Inc. and Duncan Capital Group LLC, a Delaware limited liability company and DCI Master LDC. (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on December 22, 2006. (File No. 000-51252))

10.48	Stock Purchase Agreement by and between National Investment Managers Inc., Benefit Dynamics, Inc., Jo Ann Massanova and Carmen Laverghetta (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on January 4, 2007. (File No. 000-51252))

10.49	Form of Promissory Note issued by National Investment Managers Inc. payable March 2, 2008 (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on January 4, 2007. (File No. 000-51252))

10.50	Form of Promissory Note issued by National Investment Managers Inc. payable March 2, 2009 (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on January 4, 2007. (File No. 000-51252))

10.51	Employment Agreement entered between Benefit Dynamics, Inc. and Jo Ann Massanova (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on January 4, 2007. (File No. 000-51252))

10.52	Employment Agreement entered between Benefit Dynamics, Inc. and Carmen Laverghetta (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on January 4, 2007. (File No. 000-51252))

10.53	Non-Competition, Non-Disclosure and Non-Solicitation Agreement between National Investment Managers Inc. and Jo Ann Massanova (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on January 4, 2007. (File No. 000-51252))

10.54	Non-Competition, Non-Disclosure and Non-Solicitation Agreement between National Investment Managers Inc. and Jo Ann Massanova (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on January 4, 2007. (File No. 000-51252))

10.55	Joinder Agreement between Laurus Master Fund, Ltd. and Benefit Dynamics, Inc. (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on January 4, 2007. (File No. 000-51252))

10.56	Stock Option Agreement entered by and between the Company and Jo Ann Massanova (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on January 4, 2007. (File No. 000-51252))

10.57	Stock Purchase Agreement by and between National Investment Managers Inc., Renee J. Conner, William Renninger and The Pension Alliance, Inc. (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on March 6, 2007. (File No. 000-51252))

10.58	Promissory Note issued by National Investment Managers Inc. to Renee J. Conner due April 28, 2008 (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on March 6, 2007 (File No. 000-51252))

10.59	Promissory Note issued by National Investment Managers Inc. to William Renninger due April 28, 2008 (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on March 6, 2007. (File No. 000-51252))

10.60	Promissory Note issued by National Investment Managers Inc. to Renee J. Conner due April 28, 2009 (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on March 6, 2007. (File No. 000-51252))

10.61	Promissory Note issued by National Investment Managers Inc. to Renee J. Conner due April 28, 2009 (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on March 6, 2007. (File No. 000-51252))

10.62	Employment Agreement entered between National Investment Managers Inc. and Renee J. Conner (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on March 6, 2007. (File No. 000-51252))

10.63	Non-Competition, Non-Disclosure and Non-Solicitation Agreement between National Investment Managers Inc. and Charles McLeod and Mary H. McLeod. (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on March 6, 2007. (File No. 000-51252))

10.64	Non-Competition, Non-Disclosure and Non-Solicitation Agreement between National Investment Managers Inc. and Charles McLeod and Mary H. McLeod. (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on March 6, 2007. (File No.000-51252))

10.65	Stock Purchase Agreement by and between National Investment Managers Inc., Pentec, Inc., Pentec Capital Management, Inc. and Michael E. Callahan (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on March 6, 2007. (File No. 000-51252))

10.66	Promissory Note issued by National Investment Managers Inc. to Michael E. Callahan (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on March 6, 2007. (File No. 000-51252))

10.67	Employment Agreement entered between Pentec, Inc., Pentec Capital Management, Inc. and Michael Callahan (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on March 6, 2007. (File No. 000-51252))

10.68	Non-Competition, Non-Disclosure and Non-Solicitation Agreement between National Investment Managers Inc. and Michael Callahan (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on March 6, 2007. (File No. 000-51252))

10.69	Addendum to Employment Agreement by and between the Company and Steven J. Ross (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on March 29, 2007. (File No. 000-51252))

10.70	Addendum to Employment Agreement by and between the Company and Leonard Neuhaus (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on March 29, 2007. (File No. 000-51252))

10.71	Employment Agreement by and between the Company and John Davis (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on March 29, 2007. (File No. 000-51252))

10.72	Second Omnibus Amendment and Waiver, dated as of May 2, 2007, by and between National Investment Managers, Inc. and Laurus Master Fund, Ltd. (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on May 7, 2007. (File No. 000-51252))

10.73	Second Omnibus Amendment and Waiver, dated as of May 2, 2007, by and between National Investment Managers, Inc. and Laurus Master Fund, Ltd. (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on May 7, 2007. (File No. 000-51252))

10.74	Second Omnibus Amendment and Waiver, dated as of May 2, 2007, by and between National Investment Managers, Inc. and Laurus Master Fund, Ltd. (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on May 7, 2007. (File No. 000-51252))

10.75	Employment Agreement by and between National Investment Managers Inc. and Steven Ross (to be filed by amendment) (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on December 4, 2007. (File No. 000-51252))

10.76	Agreement by and between National Investment Managers Inc. and DC Associates LLC (“DCA”), and Michael Crow (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on December 4, 2007. (File No. 000-51252))

10.77	Amendment No. 1 to the Agreement, dated as of November 30, 2007 by and among National Investment Managers Inc. Duncan Capital Group LLC and DCI Master LDC (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on December 4, 2007. (File No. 000-51252))

10.78	Stock Purchase Agreement among National Investment Managers Inc., California Investment Annuity Sales, Inc., Richard L. Kaplan and Hana E. Kaplan Inter Vivos Trust Agreement dated 1/29/97 as amended and restated 1/10/03 and Anthony Delfino dated April 3, 2008 (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on April 8, 2008 (File No. 000-51252))

10.79	Employment Agreement by and between Richard L. Kaplan and VEBA Administrators, Inc. dated April 3, 2008 (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on April 8, 2008 (File No. 000-51252))

10.80	Consulting Agreement by and between Anthony S. Delfino and VEBA Administrators, Inc. dated April 3, 2008 (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on April 8, 2008 (File No. 000-51252))

10.81	Non-Disclosure and Non-Solicitation Agreement by and between Anthony S. Delfino and National Investment Managers Inc. dated April 3, 2008 (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on April 8, 2008 (File No. 000-51252))

10.82	Non-Disclosure and Non-Solicitation Agreement by and between Richard Kaplan and National Investment Managers Inc. dated April 3, 2008 (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on April 8, 2008 (File No. 000-51252))

10.83	Promissory Note payable to Anthony S. Delfino (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on April 8, 2008 (File No. 000-51252))

10.84	Promissory Note payable to Richard Kaplan (Incorporated by reference to Form 8-K filed with the Securities and Exchange Commission on April 8, 2008)

10.85	Settlement Agreement and Release by and between Renee J. Conner, William E. Renninger and National Investment Managers Inc. dated May 15, 2008 (Incorporated by reference to the Form 10Q Quarterly Report files with the Securities and Exchange Commission on May 15, 2008)

10.86	Promissory Note issued by National Investment Managers, Inc. to Renee J. Conner and William E. Renninger due April 30, 2009 (Incorporated by reference to the Form 10Q Quarterly Report files with the Securities and Exchange Commission on May 15, 2008).

10.87	Promissory Note issued by National Investment Managers, Inc. to Renee J. Conner and William E. Renninger due October 31, 2009 (Incorporated by reference to the Form 10Q Quarterly Report files with the Securities and Exchange Commission on May 15, 2008).

10.88	Addendum to the Employment Agreement by and between National Investment Managers Inc. and John M. Davis

21.1	List of Subsidiaries of the Company

31.1	Certification of Chief Executive Officer pursuant to Rule 13a-14(a) or Rule 15d-14(a) as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

31.2	Certification of the Interim Chief Financial Officer pursuant to Rule 13a-14(a) or Rule 15d-14(a) as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

32	Certification of Chief Executive Officer and Interim Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

NATIONAL INVESTMENT MANAGERS INC.

Registrant

Dated: August 14, 2008	/s/ Steven Ross
	Steven Ross
	Chief Executive Officer and Director

Dated: August 14, 2008	/s/ John Schroepfer
	John Schroepfer
	Interim Chief Financial Officer

EX-4.57 2 v123340_ex4-57.htm

Exhibit 4.57

AMENDMENT NO. 4 TO REVOLVING LINE OF CREDIT AND

TERM LOAN AGREEMENT

This Amendment No. 4 to Revolving Line of Credit and Term Loan Agreement (this “Agreement”) is by and between RBS Citizens, National Association, having a lending office at 28 State Street, Boston, MA 02109 (the “Lender”) and National Investment Managers Inc., a Florida corporation having an address of 545 Metro Place South, Suite 100, Dublin, OH 43017 (the “Borrower”).

R E C I T A L S

Reference is hereby made to a certain Revolving Line of Credit and Term Loan Agreement, dated as of November 30, 2007, by and between Borrower and Lender, as amended by (i) a certain Amendment No. 1 to Term Loan Agreement, dated March 31, 2008, (ii) a certain Amendment No. 2 to Term Loan Agreement, dated June 30, 2008, and (iii) a certain Amendment No. 3 to Term Loan Agreement, dated June 30, 2008 (as amended, the “Loan Agreement”). The loan obligations of Borrower to Lender are further evidenced by (i) a certain Term Promissory Note, dated November 30, 2007, from the Borrower to the Lender in the maximum principal amount of up to $13,000,000.00, as amended by a certain Amendment No. 1 and Allonge to Term Promissory Note, dated as of June 30, 2008, increasing the maximum principal amount to $15,000,000.00 and (ii) a certain Revolving Line of Credit Note, dated November 30, 2007, from the Borrower to the Lender in the maximum principal amount of $2,000,000.00 (together and as amended, the “Notes”). All capitalized terms used herein and not otherwise defined herein shall have the meanings as set forth in the Loan Agreement.

B.	Borrower has requested that Lender advance a Term Loan Advance to fund the Financed Acquisition of Alan N. Kanter & Associates, Inc., a Maryland corporation with its principal place of business at 31 Walker Avenue, 2nd Floor, Baltimore, MD 21208 (the “Subsidiary”).

Lender has agreed to advance such Term Loan Advance for the Financed Acquisition, provided that Borrower joins with Lender in the execution of this Agreement and satisfies the conditions precedent for the Financed Acquisition set forth herein, including, without limitation, the execution by the Subsidiary of a Guaranty of the Loans.

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, Lender and Borrower hereby agree as follows:

1.	The Lender hereby consents to the acquisition of the Subsidiary on the terms set forth in a certain Stock Purchase Agreement, dated as of June 30, 2008, among the Borrower, the Subsidiary, and Alan N. Kanter, and the acquisition of the Subsidiary shall be deemed to be a Permitted Acquisition.

Amendment No. 4 to Revolving Line of Credit and Term Loan Agreement

Page 1 of 7

2.	To evidence that the Subsidiary is an additional Guarantor of the Loans, Schedule A to the Loan Agreement is hereby deleted in its entirety and the attached new Schedule A is substituted therefor.

Lender and Borrower hereby agree that, as a result of the acquisition of the Subsidiary as an Acquired Entity (as defined in the Loan Agreement), the updated calculation of Acquired EBITDA shall be as set forth on the table attached hereto as Schedule 1(a) “Acquired EBITDA” which Schedule shall be considered incorporated into and part of the Loan Agreement. The calculations set forth on Schedule 1(a) “Acquired EBITDA” are hereby intended to supersede and replace any prior agreements between Lender and Borrower as to the calculation of Acquired EBITDA.

4.	As a condition of this Agreement, Borrower shall at the time of execution of this Agreement:

(a)

reimburse Lender for its-out-of pocket costs in connection with this Agreement and the Modification Documents (as defined below), including reasonable legal fees and expenses incurred by Lender;

(b)

deliver to Lender the following documents in form and substance reasonably satisfactory to Lender or, if applicable, as required by the terms and conditions of the Loan Agreement:

(i)

an Amendment No. 3 to Stock Pledge executed by Borrower;

(ii)

an Amendment No. 4 to Intercreditor Agreement executed by Borrower and by Junior Lender;

(iii)

a Stock Power certificate executed in blank by Borrower in favor of Lender with respect to the stock of the Subsidiary;

(iv)

a Perfection Certificate executed by the Subsidiary;

(v)

a Guaranty in favor of Lender executed by the Subsidiary; and

(vi)

a Security Agreement executed by the Subsidiary in favor of Lender.

The foregoing documents and any additional documents executed herewith, together with this Agreement, shall be referred to herein as the “Modification Documents”; and

Amendment No. 4 to Revolving Line of Credit and Term Loan Agreement

Page 2 of 7

(c)

satisfy and/or be in compliance with the Financed Acquisition Conditions on the date hereof and at the time of the advance by Lender of the Term Loan Advance contemplated hereby.

Borrower hereby represents and warrants that: (i) its representations and warranties set forth in the Loan Agreement are true in all material respects on and as of the date hereof as if made on such date (except to the extent that the same expressly relate to an earlier date or are affected by the consummation of transactions permitted hereby or by the Agreement); (ii) it is in compliance in all material respects with all of the terms and provisions set forth in the Loan Agreement on its part to be observed or performed; (iii) after giving effect to any extension of credit to be made on the date hereof, no Event of Default or Default Event has occurred and is continuing; (iv) since the date of the financial statements most recently provided to Lender by Borrower, there has occurred no material adverse change in the assets or liabilities or the financial or other condition of Borrower; (v) it has full power to execute, deliver and perform its obligations under the Modification Documents and the execution, delivery and performance of the Modification Documents have been authorized and directed by the appropriate parties; (vi) the Modification Documents constitute the legal, valid and binding obligations of Borrower and/or the Subsidiary, as applicable, enforceable in accordance with their terms; (vii) the execution, delivery and performance thereof will not violate any provision of any existing law or regulation applicable to Borrower or the Subsidiary or their respective governing documents or of any order or decree of any court, arbitrator or governmental authority or of any contractual undertaking to which either is a party or by which either may be bound; and (viii) no consents, licenses, approvals or authorizations of, exemptions by or registrations or filings with, any governmental authority are required with respect to the Modification Documents.

6.	If Borrower fails to comply with all the terms and conditions of the Modification Documents, such failure shall constitute a default under this Agreement and an Event of Default under the Loan Agreement and other Loan Documents.

No other changes shall be made to the Loan Agreement, and Borrower reaffirms its obligations under the Loan Documents (as amended hereby) in their entirety. This Agreement is not intended to extinguish or affect any of the debt evidenced by the Notes or to otherwise modify any of the obligations under any of the Loan Documents, except as amended hereby. Borrower hereby reaffirms that Borrower remains indebted to Lender without defense, counterclaim or offset and hereby releases Lender from any and all claims or other causes of action which Borrower may have against Lender with respect to the Loans and the Loan Documents.

This Agreement is made in the Commonwealth of Massachusetts and shall be construed in accordance with its laws without regard to principles of conflicts of laws. If any provision hereof is in conflict with any statute or rule of law of the Commonwealth of Massachusetts or any other statute or rule of law of any other applicable jurisdiction or is otherwise unenforceable, such provisions shall be deemed null and void only to the extent of such conflict or unenforceability and shall be deemed separate from and shall not invalidate any other provision of this Agreement.

Amendment No. 4 to Revolving Line of Credit and Term Loan Agreement

Page 3 of 7

This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns, and no other parties shall be a beneficiary hereunder. Neither this Agreement nor any of the provisions hereof can be changed, waived, discharged or terminated except by an instrument in writing signed by the party against whom enforcement of the change, waiver, discharge or termination is sought.

10.

This Agreement may be signed in counterparts, each of which shall be deemed an original and all of which, when taken together, shall constitute one and the same instrument. Signatures delivered by facsimile transmission shall have the same force and effect as original signatures delivered in person.

[Signatures on following page]

Amendment No. 4 to Revolving Line of Credit and Term Loan Agreement

Page 4 of 7

EXECUTED under seal as of the 16th day of July, 2008.

	LENDER:

	RBS CITIZENS, NATIONAL ASSOCIATION

/s/ Imran S. Bora	By:	/s/ David Bugbee
Witness	Name:	David Bugbee
	Title:	Senior Vice President

	BORROWER:

	NATIONAL INVESTMENT MANAGERS INC.

/s/ John Schroepfer	By:	/s/ John M. Davis
Witness	Name:
	Title:

Amendment No. 4 to Revolving Line of Credit and Term Loan Agreement

Page 5 of 7

SCHEDULE A

Amendment No. 4 to Revolving Line of Credit and Term Loan Agreement

Page 6 of 7

SCHEDULE 1(A)

“ACQUIRED EBITDA”

Applicable Time Period	For the four fiscal quarter period ending June 30, 2008, an amount equal to:		For four fiscal quarter period ending September 30, 2008, an amount equal to:		For the four fiscal quarter period ending December 31, 2008, an amount equal to:			For the four fiscal quarter period ending March 31, 2009, an amount equal to:
Acquired EBITDA for CIAS	$	363,945	$	259,518	$	124,842			N/A

Acquired EBITDA for Alaska Pension Services, Ltd.	$	244,402	$	209,640	$	(16,159	)	$	33,760

Acquired EBITDA for Alan N. Kanter & Associates, Inc.	$	340,815	$	245,824		176,270			156,008

Total Acquired EBITDA for Applicable Time Period	$	949,162	$	714,982	$	284,953		$	189,768

Amendment No. 4 to Revolving Line of Credit and Term Loan Agreement

Page 7 of 7

EX-4.58 3 v123340_ex4-58.htm

Exhibit 4.58

AMENDMENT NO. 4 TO INTERCREDITOR AND SUBORDINATION AGREEMENT

This Amendment No. 4 to Intercreditor and Subordination Agreement (the “Agreement”) is by and among (i) RBS CITIZENS, NATIONAL ASSOCIATION (the “Senior Creditor”), (ii) WOODSIDE CAPITAL PARTNERS IV, LLC, WOODSIDE CAPITAL PARTNERS IV QP, LLC and LEHMAN BROTHERS COMMERCIAL BANK (the “Holders”), (iii) WOODSIDE AGENCY SERVICES, LLC, as collateral agent for the Holders (the “Collateral Agent” and together with the Holders, the “Subordinating Creditors”), (iv) NATIONAL INVESTMENT MANAGERS INC., a Florida corporation (the “Company”), and (v) the Guarantors named on the signature pages of this Agreement (the “Guarantors” and together with the Company, the “Obligors”). The parties named above shall be collectively referred to herein as the “Parties”.

R E C I T A L S

Reference is hereby made to a certain Intercreditor and Subordination Agreement, dated as of November 30, 2007, by and among Senior Creditor, the Subordinating Creditors, and the Obligors, as amended by (i) a certain Amendment No. 1 to Intercreditor and Subordination Agreement dated as of March 31, 2008, (ii) a certain Amendment No. 2 to Intercreditor and Subordination Agreement dated as of June 30, 2008 and (iii) a certain Amendment No. 3 to Intercreditor and Subordination Agreement dated as of June 30, 2008 (as amended, the “Intercreditor Agreement”). All capitalized terms used herein and not otherwise defined herein shall have the meanings as set forth in the Intercreditor Agreement.

Company has requested approval of and/or financing from the Senior Creditor and Subordinating Creditors for the Company’s acquisition of Alan N. Kanter & Associates, Inc., a Maryland corporation with its principal place of business at 31 Walker Avenue, 2nd Floor, Baltimore, MD 21208 (the “Subsidiary”).

Senior Creditor and Subordinating Creditors have approved of and/or have agreed to provide financing for the Company’s acquisition of the Subsidiary and, in connection therewith, have required that the Subsidiary execute certain guaranties in favor of Senior Creditor and Subordinating Creditors of the Company’s obligations under the Senior Documents and the Subordinated Documents, respectively.

D.	In connection with the execution of the foregoing guaranties, the Senior Creditor and Subordinating Creditors have also required that the Subsidiary agree, by its execution of this Agreement, to be bound by the terms and conditions of the Intercreditor Agreement.

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Parties hereby agree as follows:

Amendment No. 4 to Intercreditor and Subordination Agreement

Page 1 of 6

1.	The definition of “Guarantors” and “Obligors” set forth in the Intercreditor Agreement shall hereby be deemed to include the Subsidiary, and Subsidiary hereby agrees to be bound by the terms and conditions of the Intercreditor Agreement.

Any guaranties executed by Subsidiary in favor of Senior Creditor shall hereby be deemed to be a “Senior Guaranty” under the Intercreditor Agreement, and any guaranties executed by Subsidiary in favor of Subordinated Creditors shall hereby be deemed to be a “Junior Guaranty” under the Intercreditor Agreement.

No other changes shall be made to the Intercreditor Agreement. This Agreement is made in the Commonwealth of Massachusetts and shall be construed in accordance with its laws without regard to principles of conflicts of laws. If any provision hereof is in conflict with any statute or rule of law of the Commonwealth of Massachusetts or any other statute or rule of law of any other applicable jurisdiction or is otherwise unenforceable, such provisions shall be deemed null and void only to the extent of such conflict or unenforceability and shall be deemed separate from and shall not invalidate any other provision of this Agreement.

[Signatures appear on following page]

Amendment No. 4 to Intercreditor and Subordination Agreement

Page 2 of 6

EXECUTED under seal as of the 16th day of July, 2008.

SENIOR CREDITOR:

RBS CITIZENS, NATIONAL ASSOCIATION


By:	/s/ Imran S. Bora
	Imran S. Bora, Vice President

Amendment No. 4 to Intercreditor and Subordination Agreement

Page 3 of 6

SUBORDINATING CREDITORS:

WOODSIDE CAPITAL PARTNERS IV, LLC

	By: Woodside Opportunity Partners, LLC, its Manager
	By: Woodside Capital Management, LLC, its Manager

By:	/s/ Daphne J. Firth
	Name: Daphne J. Firth
	Title: EVP

WOODSIDE CAPITAL PARTNERS IV QP, LLC

	By: Woodside Opportunity Partners, LLC, its Manager
	By: Woodside Capital Management, LLC, its Manager

By:	/s/ Daphne J. Firth
	Name: Daphne J. Firth
	Title: EVP

LEHMAN BROTHERS COMMERCIAL BANK

By:	/s/ Gary Murray
	Name: Gary Murray
	Title: ECO

WOODSIDE AGENCY SERVICES, LLC

By:	Woodside Capital Management, LLC, its Manager

By:	/s/ Daphne J. Firth
	Name: Daphne J. Firth
	Title: EVP

Amendment No. 4 to Intercreditor and Subordination Agreement

Page 4 of 6

COMPANY:

NATIONAL INVESTMENT MANAGERS INC.

By:	/s/ John M. Davis
	Name: John M. Davis
	Title: President & COO

Amendment No. 4 to Intercreditor and Subordination Agreement

Page 5 of 6

GUARANTORS:

ABR Advisors, Inc.

Alan N. Kanter & Associates, Inc.

Alaska Pension Services, Ltd.

Asset Preservation Corp.

Benefit Dynamics, Inc.

Benefit Management Inc.

BPI/PPA Inc.

California Investment Annuity Sales, Inc.

Circle Pension, Inc.

Complete Investment Management, Inc. of Philadelphia

Haddon Strategic Alliances, Inc.

Lamoriello & Co., Inc.

National Actuarial Pension Services, Inc.

National Associates, Inc., N.W.

Pension Administration Services, Inc.

Pentec, Inc

Pentec Capital Management, Inc.

Southeastern Pension Services, Inc.

Stephen H. Rosen & Associates, Inc.

The Pension Alliance, Inc

Valley Forge Consulting Corporation

VFE Merger Corp. a/k/a Valley Forge Enterprises, Ltd.

VEBA Administrators, Inc.

(d/b/a Benefit Planning, Inc.)

V.F. Associates, Inc.

V.F. Investment Services Corp.

By:	/s/ Steven J. Ross
	Steven J. Ross, Chief Executive Officer

Amendment No. 4 to Intercreditor and Subordination Agreement

Page 6 of 6

EX-10.88 4 v123340_ex10-88.htm

Exhibit 10.88

ADDENDUM to EMPLOYMENT AGREEMENT

This Addendum provision (“Addendum”) is for the Employment Agreement (“Agreement”) entered into as of March 15, 2007 (“Effective Date”) between National Investment Managers Inc. (“Company”) and John M. Davis (“Executive”). This addendum is specific to the second term (4/1/08 - 3/31/09) of the Agreement and is entered into as of April 1, 2008 (“Effective Date”).

RECITALS

Company wishes to retain Executive as its President and Chief Operating Officer, and Executive wishes to continue such employment under the terms and conditions set forth in the Agreement with the following revisions effective for the second term.

IT IS AGREED that the following changes/revisions for the second term of the Agreement, are effective as follows:

1. Base Salary. Executive shall be paid a base salary of Three Hundred Thousand Dollars ($300,000) per annum for the term payable, less applicable withholding, in equal monthly payments or more frequently in accordance with Company’s regular practice.

2. Bonus - A. Executive shall be eligible to receive an incentive bonus targeted at fifty percent (50%) of Executive’s base salary:

50% based upon the achievement of 2008 EBITDA SBC of $12,005,543.00.

50% based upon attainment of MBOs to be established by the Chief Executive Officer.

3. Bonus - B. Executive shall be eligible to receive an additional incentive bonus of $100,000 upon an eligible change of control (as defined in the Agreement) OR the attainment of Thirteen Million Five Hundred Thousand Dollars ($13,500,000) adjusted EBITDA SBC for the trailing 12 months at June 30, 2008 or comparable enterprise valuation, payable within 45 days after the occurrence of either event.

4. Stock Options. Executive shall receive an option grant to purchase 200,000 shares of the Company stock at $0.61 which shall be issued upon the effective date of this Addendum to the Agreement. The options shall vest at the rate of one hundred thousand (100,000) options every six (6) months for the twelve month period (April 18, 2008 to April 17, 2009) immediately following the date of grant, provided that Optionee continues as a full-time employee of the Company; however, this option shall vest immediately upon a change in control (as defined in the Employment Agreement).

The parties have executed this Addendum to the Agreement as of the Effective Date.



	By:	/s/ John M. Davis
	Name:	John M. Davis
	Title:	President and Chief Operating Officer


	National Investment Managers Inc.

	By:	/s/ Steven Ross
	Name:	Steven Ross
	Title:	Chief Executive Officer and Director

EX-21.1 5 v123340_ex21-1.htm

Exhibit 21.1

NATIONAL INVESTMENT MANAGERS INC.

List of Subsidiaries

SUBSIDIARY NAME	STATE OF INCORPORATION	ADDRESS

ABR Advisors, Inc.	Delaware	2985 Navajo Street
		Yorktown Heights, NY 10598

Alan N. Kanter & Associates, Inc.	Maryland	31 Walker Avenue, Ste. 200
		Pikesville, MD 21208-4020

Alaska Pension Services, Ltd.	Alaska	400 D Street, Suite 300
		Anchorage, AK 99501

Asset Preservation Corp.	Pennsylvania	110 Gibraltar Road, Suite 101
		Horsham, PA 19044-2376

Benefit Dynamics, Inc.	Pennsylvania	89 N. Haddon Avenue, Suite D
		Haddonfield, NJ 08033

Benefit Management Inc.	Massachusetts	3 Lyons Way
		North Attleboro, MA 02763

BPI/PPA Inc.	Delaware	1013 Centre Road
		Wilmington, DE 10805

California Investment Annuity Sales, Inc.	California	4640 Admiralty Way, 9^th Floor
		Marina Del Rey, CA 90292

Circle Pension, Inc.	New York	Empire State Bldg.,
		350 Fifth Ave., Ste. 534
		New York, NY 10118

Complete Investment Management, Inc.	Pennsylvania	110 Gibraltar Road, Suite 101
		Pennsylvania Business Campus
		Horsham, PA 19044

Doyle Barnett Associates, Inc.	New York	2985 Navajo Street
		Yorktown Heights, NY 10598

Haddon Strategic Alliances, Inc.	New Jersey	426 Queensboro Lane
		Haddonfield, NJ 08033

Lamoriello & Co., Inc.	Rhode Island	2374 Post Road, Suite 1
		Warwick, RI 02886

National Actuarial Pension Services, Inc.	Texas	10777 Westheimer Road, Suite 220
		Houston, TX 77042

National Associates, Inc. NW	Washington	2212 2^nd Avenue, West
		Seattle, WA 98119

Pension Administration Services, Inc.	Pennsylvania	110 Gibraltar Road, Suite 101
		Horsham, PA 19044-2376

NATIONAL INVESTMENT MANAGERS INC.

List of Subsidiaries

SUBSIDIARY NAME	STATE OF INCORPORATION	ADDRESS

Pentec Capital Management, Inc.	Connecticut	72 Queen Street
		Southington, CT 06489P

Pentec, Inc.	Connecticut	72 Queen Street
		Southington, CT 06489

Southeastern Pension Services, Inc.	Florida	1525 International Parkway, Suite 2071
		Lake Mary, FL 32746

Stephen H. Rosen & Associates, Inc.	New Jersey	89 North Haddon Avenue
		Haddonfield, NJ 08033

The Pension Alliance, Inc.	Pennsylvania	2578 Interstate Drive, Suite 102
		Harrisburg, PA 17110

Valley Forge Consulting Corporation	Pennsylvania	998 Old Eagle School Road, Suite 1206
		Wayne, PA 19087

VEBA Administrators, Inc.	California	4640 Admiralty Way, 9^th Floor
d/b/a Benefit Planning, Inc.		Marina Del Rey, CA

V.F. Associates, Inc	Pennsylvania	998 Old Eagle School Road, Suite 1206
		Wayne, PA 19087

VFE Merger Corp.		998 Old Eagle School Road, Suite 1206
a/k/a/ Valley Forge Enterprises, Ltd.	Pennsylvania	Wayne, PA 19087

V.F. Investment Services Corp.	Pennsylvania	998 Old Eagle School Road, Suite 1206
		Wayne, PA 19087

EX-31.1 6 v123340_ex31-1.htm

Exhibit 31.1

CERTIFICATION

I, Steven Ross, certify that:

1. I have reviewed this Form 10-Q of National Investment Managers Inc. (the "Company");

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the Company as of, and for, the periods presented in this report;

4. The Company's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15-(e)) [language omitted pursuant to SEC Release No. 34-47986] for the Company and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Company, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the Company's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the Company's internal control over financial reporting that occurred during the Company's most recent fiscal quarter (the Company's first fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the Company's internal control over financial reporting; and

5. The Company's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Company's auditors and the audit committee of the Company's board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Company's ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the Company's internal control over financial reporting.

Date: August 14, 2008	/s/ Steven Ross
	Steven Ross,
	Chief Executive Officer and Director

EX-31.2 7 v123340_ex31-2.htm

Exhibit 31.2

CERTIFICATION

I, John Schroepfer, certify that:

1. I have reviewed this Form 10-Q of National Investment Managers Inc. (the "Company");

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the Company's internal control over financial reporting.

Date: August 14, 2008	/s/ John Schroepfer
	John Schroepfer
	Interim Chief Financial Officer

EX-32 8 v123340_ex32.htm

Exhibit 32

CERTIFICATION OF CHIEF EXECUTIVE OFFICER AND CHIEF FINANCIAL

OFFICER

PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

The undersigned hereby certifies, pursuant to, and as required by, 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that the Quarterly Report of National Investment Managers Inc. (the "Company") on Form 10-Q for the period ended June 30, 2008 fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended, and that information contained in such Quarterly Report on Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of the Company.

Dated: August 14, 2008	/s/ Steven Ross
	Steven Ross
	Chief Executive Officer and Director

Dated: August 14, 2008	/s/ John Schroepfer
	John Schroepfer
	Interim Chief Financial Officer

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