IMPORTS

Addison-Clifton, LLC delivers Import Compliance Solutions ("ICS") within two primary compliance capsules of advisory services:

• Customs Modernization Act ("Mod Act") and Informed Compliance Requirements
• Supply-Chain Security Risk Management Programs

The Mod Act was enacted in January 1994 as part of the North America Free Trade Agreement, and it requires U.S. importers to exercise "reasonable care" when classifying, valuing and entering merchandise into the U.S. The Mod Act mandates compliance with a "reasonable care checklist" and creates substantial standards for trade data integrity and record-keeping. Severe penalties for violations of the Mod Act have been imposed upon importers and supply-chain service providers based upon three degrees of culpability--negligence, gross negligence and fraud. The severity of the penalty imposed by the Customs and Border Protection ("CBP") is indirectly related to the degree of culpability associated with the violation with penalties up to $100,000 for the willful failure to maintain, store or retrieve information requested by CBP or other government agencies. The ICS capsule of services includes assistance in completing the Focused Assessment Program which allows the importer and CBP to assess compliance risks associated with the importer's organizational structure and internal controls related to customs transactions.

The CBP has implemented a series of supply-chain security initiatives for U.S. importers which are designed to increase import efficiency while enhancing border security in the U.S. The ICS capsule of services includes: (1) assistance in satisfying participant security profile criteria for the Customs-Trade Partnership Against Terrorism ("C-TPAT") initiative designed to develop, enhance and maintain effective security processes throughout the global supply chain; (2) assistance in completing the C-TPAT Validation Process, including preparation for the on-site validation visit by CBP; and (3) personnel training regarding maintenance of the supply-chain security profile and C-TPAT participation. The ICS includes advice and assistance regarding participation in the Free and Secure Trade ("FAST") Initiative between the U.S. and Canada which offers expedited clearance of merchandise to carriers and importers enrolled in the C-TPAT.

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EXPORTS

Addison-Clifton, LLC delivers Export Compliance Solutions ("ECS") within two primary compliance capsules of advisory services:

• Export Administration Regulations Management Systems
• Global Distribution Compliance

The Bureau of Industry and Security ("BIS") of the U.S. Department of Commerce administers the export control provisions of the Export Administration Regulations ("EAR"). The BIS has significantly enhanced the enforcement of controls on the export of dual-use items in the collective efforts to combat terrorism and protect U.S. national security. Exporters and their supply-chain service providers must comply with additional export regulations enforced by the Office of Foreign Assets Control ("OFAC") of the U.S. Department of the Treasury, the Directorate of Defense Trade Controls ("DDTC") of the State Department, the Drug Enforcement Administration and other agencies. The ECS capsule of services includes the development and assistance in implementing an Export Management System in accordance with the myriad of ever-changing export control regulations.

Today's exporter and export service provider must also comply with numerous U.S. laws related to the global distribution process, including the Foreign Corrupt Practices Act, anti-boycott regulations and anti-money laundering regulations. Most major members of the World Trade Organization also enforce similar regulations related to the global distribution process. The ECS capsule of services includes assistance in developing and implementing a global distribution compliance matrix.