The following is the text of the Trustee's Motion to Approve Settlement with the Balsam Group:

UNITED STATES BANKRUPTCY COURT
SOUTHERN DISTRICT OF FLORIDA

CHAPTER 11 TRUSTEE'S MOTION TO APPROVE SETTLEMENT WITH
THE BALSAM GROUP AND MEMORANDUM OF LAW IN SUPPORT THEREOF

John W. Kozyak ("Kozyak" or "Trustee"), the duly appointed Chapter 11 Trustee of Financial Federated Title & Trust, Inc. ("FinFed"), moves pursuant to Fed.R.Bankr.P. 9019 and Local Rule 9013-1(D)(3)(b) for approval of a settlement reached with Zane Balsam ("Balsam"), Jill Balsam ("Mrs. Balsam"), Ruth Balsam, ELS Group, Inc., Secure Transaction International Corporation, Real-Time Processing, Inc. f/k/a Real Time Encryption, Inc., Real-Time Security, Inc., Virtual Motion Software Development, Inc., Minute Communications, Inc., Tidal Wave Associates, Ltd., and the Virtual Family Trust (the "Balsam Affiliates") (all collectively referred to as the "Balsam Group"), and in support states:

1. On October 7, 1999 an involuntary petition under Chapter 11 of the Bankruptcy Code was filed against FinFed. An order for relief was entered on November 16, 1999 (the "Relief Date"), and Kozyak is the duly appointed Trustee of FinFed. Thereafter, pursuant to various judgments of this Court, Asset Security Corp., Viatical Asset Recovery Corp., Quad B, Ltd. and American Benefit Services, Inc., have been determined to be alter egos of FinFed (FinFed and its various alter egos and affiliates shall be referred to as the "FinFed Entities").
2. The Trustee alleges that the Balsam Group received from the FinFed Entities, directly or indirectly, transfers in excess of $14 million recoverable by the Trustee.
3. The Balsam Group, without admitting any liability or wrongdoing whatsoever arising out of their receipt of funds or assets from any of the FinFed Entities, desire to settle amicably any claims that any of the FinFed Entities might have against any of them, but have a limited amount of assets from which recovery by any party, including the Trustee, could be made.
4. The Trustee and the Balsam Group have reached a settlement with respect to the Trustee's claims, which is memorialized in the Settlement Agreement attached as Exhibit "A".
5. The Settlement Agreement includes, among other elements, the following components:

• The Balsam Group acknowledge an obligation to the Trustee in the amount of $14,382,797, which is to be paid in full with interest within one year from the Relief Date, unless prepaid with limited (a maximum of 15% if paid in full within 90 days) discounts during the year.

• In order to secure payment of said obligation, the Balsam Group grant to the Trustee a security interest in all of their personal and corporate assets (the "Pledged Assets") excluding $75,000 of personal property for Zane Balsam and some specified, exempt property for Mr. Balsam's mother, Ruth Balsam.

• The Trustee and the Balsam Group shall coordinate in the liquidation of all of the Pledged Assets with the Balsam Group remaining responsible for payment of all taxes, insurance, maintenance and upkeep expenses.

• Balsam has agreed to the turnover of title to his residence. This residence in Boca Raton, Florida is expected to sell for $2 million or more and the Trustee is awaiting the government's permission to list it. This is a property seized by the U.S. Government in the criminal action and the proceeds will be disbursed through a separate, U.S. District Court approved restitution plan.

•Balsam is cooperating in arranging to have an office building in Toronto sold for approximately $2 million, with the funds transferred to the Trustee.

•Legal causes of action available to the Balsam Group are being assigned to the Trustee.

• Each of the Balsam Group shall deliver to the Trustee sworn financial disclosures identifying all of their assets and liabilities, as well as any transfers in excess of $20,000 made since January 1996, which shall be subject to polygraph testing in the Trustee's discretion.

• The Balsam Group shall release the Trustee and all the FinFed entities from any claims; such Release will be delivered upon court approval of this Settlement Agreement.

• The Trustee shall provide a release of all claims of the Trustee against the Balsam Group, on behalf of the FinFed Bankruptcy Estate, to be held in escrow until the settlement obligations are paid in full.

• The Balsam Group is immediately turning over approximately $336,930 in cash to the Trustee which will be credited against the amount due. The Balsam Group is also committed to operating its credit card protection and verification business known as Real-Time Processing, Inc. ("Real-Time"), on a profitable basis. The Trustee has agreed that Real-Time may continue to use $100,000 in separate, available funds in its operations, subject to an agreed-upon budget and the Trustee's approval of all checks . Projections provided by Real-Time are quire optimistic and suggest the ability to repay the estate the balance of the amounts due within a year. If successful, Real-Time's business could be valuable, but the Trustee is painfully aware that the Balsam Group appears to have lost or wasted millions of dollars in the past. Approval of the Settlement Agreement should definitely not rest on these projections.

7. Balsam began negotiating this Settlement Agreement in the Fall and has provided substantial, useful information to the Trustee.

MEMORANDUM OF LAW

8. Approval of a settlement in a bankruptcy proceeding is within the sound discretion of the Court, and will not be disturbed or modified on appeal unless approval or disapproval is an abuse of discretion. In re Arrow Air, Inc., 85 B.R. 886, 891 (Bankr. S.D. Fla. 1988). The test is whether the proposed settlement "falls below the lowest point in the range of reasonableness." Id. at 891.
9. In the judgment of the Trustee and his professionals, the settlement is reasonable and in the best interests of the estate and its creditors. It ties up most available assets now, without the need for further litigation, and provides the opportunity for an upside if Balsam is able to turn Real-Time into a profitable venture.

WHEREFORE, the Trustee respectfully requests that the Court enter an order in the form attached hereto as Exhibit "B" approving the settlement with the Balsam Group, pursuant to Fed.R.Bankr.P. 9019.

I HEREBY CERTIFY that I am admitted to the Bar of the United States District Court for the Southern District of Florida and I am in compliance with the additional qualifications to practice in this court set forth in Local Rule 2090-1(A).

Kozyak Tropin & Throckmorton, P.A.
Counsel for the Trustee
2800 First Union Financial Center
200 South Biscayne Boulevard
Miami, Florida 33131-2335
Tel: (305) 372-1800
Fax: (305) 372-3508

By: /s/

Laurel Myerson Isicoff
Florida Bar No. 350923
David L. Rosendorf
Florida Bar No. 996823

CERTIFICATE OF SERVICE

I HEREBY CERTIFY that a true and correct copy of the foregoing was served via U.S. mail on all parties on the attached service list this _____ day of June, 2000.

By: /s/

Laurel M. Isicoff

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