Additional Information Supplementing

October 2009 Comments on Notice of Proposed Rulemaking

16 CFR Part 310 Telemarketing Sales Rule

Debt Relief Amendments, R411001

- Prepared By -Scott Johnson

CEO - US Debt Resolve

US Debt Resolve Background • First in industry

– ISO 9001-2000 Certified – National Bank Certification

• Standards Commitment – Supporter of Original UDMSA – Suitability Check list for clients

• Value - added Service – Education Programs – Career Training – Financial Management Tools

US Debt Resolve Company Stats General Comparison, debt statistics 2007-2009

Average Consumer Debt Load $31,411

Average Credit Card Account Balance $5,646

Average Amount of Accounts 6.1

Average Length in Program 37

Statistics Provided: •US Debt Resolve Average Data of All Clients Enrolled from 2007-2009

The Basics: Program Calculations Basic Program Calculation:

Service Fee = Debt (X) Service Fee %

Savings = Debt (X) Est. Savings %

Total Cost of Program = Savings (+) Service Fee

Monthly Payment = Monthly Payment (/) Months in Program

2007 Fee model Fee collected evenly over 18 months

2008 Fee Model First 3 payments remainder paid over duration of program

2009 Fee model First payment remainder paid over duration of program

2008 Model Specifications Formula:

# of Accounts to Settle Per Month # of Accounts aged > 210 Days / Average Length of Program

Total $ of Accounts to Settle Per Month $ of Accounts aged >210 Days / Average Length of Program

Example:

# of Accounts to Settle Per Month 18,368 >210 Days /

40 Months = 460 Accounts Per Month

Total $ of Accounts to Settle Per Month $94,586,0373 >210 Days /

40 Months = 2.36 Million

KPI Tracking – Key performance indicators - Quarterly reviews are done by Senior Management

2008 Balances Settled

70% 62%

91% 92%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90%

100%

Q1 Q2 Q3 Q4

Quarter

Per

cent

age

Balances Settled %

Adjustments to forecasting are reviewed weekly as well as monthly – daily run rates are reviewed by line managers

2008 Balances Settled

46%

53%

107%

67%

44%

65%

85%

87%

97%

113%

68%

99%

0% 20% 40% 60% 80% 100% 120%

January

February

March

April

May

June

July

August

Sept ember

Oct ober

November

December

P e r c e nt a ge

Balances Set t led %

KPI Tracking includes accounts as well as balances

2008 Accounts Settled

86%

74%

82% 82%

68% 70% 72% 74% 76% 78% 80% 82% 84% 86% 88%

Q1 Q2 Q3 Q4

Quarter

Per

cent

age

Accounts Settled %

Comprehensive data indicates 81% performance for both accounts and balances

2008 Accounts Settled

71% 71%

111%

87%

58%

73%

59%

76%

111%

97%

53%

102%

0%

20%

40%

60%

80%

100%

120%

Janu

ary Feb

ruary

March

April

May

June

July

Augus

t Sep

tembe

r Octo

ber

Novembe

r Dece

mber

Months

Perc

enta

ge

Accounts Settled %

A significant KPI measurement is performance compared to original balance

59%

49% 42% 45%

0%

10%

20%

30%

40%

50%

60%

Q1 Q2 Q3 Q4

Quarter

2008 Original Balance

Avg % of Original

Trends on balance performance reflect market conditions, client contributions and macro economic factors

2008 Original Balance

0%

10%

20%

30%

40%

50%

60%

70%

Janu

ary Feb

ruary

March

April

May

June

July

Augus

t Sep

tembe

r Octo

ber

Novembe

r Dece

mber

Months

Perc

enta

ge

Avg % of Original

Comprehensive data indicates 49% performance for original balances and 44% for current balances settled

50% 53%

35% 38%

0%

10%

20%

30%

40%

50%

60%

Q1 Q2 Q3 Q4

Quarters

2008 Current Balance

Avg % of Current

KPI monthly Current Balance breakout

2008 Current Balance

0%

10%

20%

30%

40%

50%

60%

Janu

ary Feb

ruary

March

April

May

June

July

Augus

t Sep

tembe

r Octo

ber

Novembe

r Dece

mber

Months

Perc

enta

ge

Avg % of Current

2009 Model Specifications Formula:

# of Accounts to Settle Per Month # of Accounts aged > 120 Days / Average Length of Program

Total $ of Accounts to Settle Per Month $ of Accounts aged >120 Days / Average Length of Program

Example:

# of Accounts to Settle Per Month 20,572>120 Days /

36 Months = 571 Accounts Per Month

Total $ of Accounts to Settle Per Month $ 106,051,361 >120 Days /

36 Months = 2.945 Million

Improvement in performance is a direct result of implementation of a new service fee model, operational enhancement and reporting, and improved debt owner relationships

2009 Balances Settled

107%

144% 136%

150%

0%

20%

40%

60%

80%

100%

120%

140%

160%

Q1 Q2 Q3 Q4

Quarter

Perc

enta

ge

Balances Settled %

KPI – 2009 monthly breakout

2009 Balances Settled

101%

114%

105%

141%

120%

173%

106%

133%

131%

182%

137%

132%

0% 20% 40% 60% 80% 100% 120% 140% 160% 180% 200%

January

February

March

April

May

June

July

August

Sept ember

Oct ober

November

December

P e r c e nt a ge

Balances Set t led %

Improvement of accounts settled is attributable to both company performance and increased loss rates of major lending institutions

2009 Accounts Settled

100%

126% 120%

91%

0%

20%

40%

60%

80%

100%

120%

140%

Q1 Q2 Q3 Q4

Quarter

Per

cent

age

Accounts Settled %

Comprehensive data indicates 107% performance for accounts and 135% for balances settled

2009 Accounts Settled

97% 97%

106%

130%

117%

129%

89%

161%

142%

166%

76%

67%

0%

20%

40%

60%

80%

100%

120%

140%

160%

180%

Janu

ary Feb

ruary

March

April

May

June

July

Augus

t Sep

tembe

r Octo

ber

Novembe

r Dece

mber

Months

Perc

enta

ge

Accounts Settled %

An increase to settlement percentages is a result of significant increase in debt owner litigation

48% 47%

61% 54%

0%

10%

20%

30%

40%

50%

60%

70%

Q1 Q2 Q3 Q4

Quarters

2009 Original Balance

Avg % of Original

KPI - 2009 monthly breakout

2009 Original Balance

0%

10%

20%

30%

40%

50%

60%

70%

Janu

ary Feb

ruary

March

April

May

June

July

Augus

t Sep

tembe

r Octo

ber

Novembe

r Dece

mber

Months

Perc

enta

ge

Avg % of Original

Measurement against current balance allows USDR to evaluate negotiator performance, creditor agreements and debt owner acceptance

40% 40%

51% 45%

0%

10%

20%

30%

40%

50%

60%

Q1 Q2 Q3 Q4

Quarters

2009 Current Balance

Avg % of Current

Comprehensive data indicates 52% performance for original balances and 44% for current balances settled

2009 Current Balance

0%

10%

20%

30%

40%

50%

60%

Janu

ary Feb

ruary

March

April

May

June

July

Augus

t Sep

tembe

r Octo

ber

Novembe

r Dece

mber

Months

Perc

enta

ge

Avg % of Current

Trends indicate a 9% average attrition rate

Attrition

0

5

10

15

20

1

Year

Per

cent 2007

2008 2009

Clients with a smaller debt load – debt comprised of many accounts and have low balances - results in higher accretion

2007 Accretion Breakout

0

5

10

15

20

25

30

35

40

45

2007

Perc

ent

2007 Under 20K 2007 Over 20K

Reduction in accretion is reflected in increased average balance

2008 Accretion Breakout

0

2

4

6

8

10

12

2008

Perc

ent

2008 Accretion Under 2008 2008 Accretion over 20K

Time Frame of settlement decreases the accretion of a debt

2009 Accretion Breakout

0

1

2

3

4

5

6

7

2009

Perc

ent

2009 Accretion under 20K 2009 Over 20K

A fee model designed to address accretion, the total cost of the program, and increased litigation, means designing a program that remits settlements to the debt owner in the shortest time frame possible

3 Year Accretion By Year

0

2

4

6

8

10

12

14

Year

Per

cent 2007

2008 2009

Overview of US Debt Resolve Graduates

Program Length

Average 34 Months

Minimum 12 Months

Maximum 60 Months

Service Fees

Average (%) 11.95%

Average Fee($) $3,615

11.27%Average

43.48%Average Current Balance

51.8%Average Original Balance

Settlement Percentage

$325,000Maximum Debt

$3,500Minimum Debt

$29,739Average Debt

Debt Loads

Accretion