Version 1'2, 12'2006

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Compliance Operational Risk Management for the
Enterprise (CORME)
Prepared for xxx

• Version 1.2, 12.2006

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Content...

• Current Environment and Challenges
• The Market Needs
• HTPs Market Solution
• The Functional Offering
• Explanation of Software-as-a-Service
• The CORME Offering Details

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Current Environment Three Kinds of Risk...

• HTPs Focus Operational Risk
• Document and Message Management
• Email and web-content control
• Compliance Workbench
• Know Your Customer (KYC)
• Anti-money Laundering (AML)

FinancialRisk
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EventRisk
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Current Environment Regulatory and Compliance
Environment...

• Compliance is costly and burdensome for all
  financial firms
• All electronic and web content must be
  immediately searchable and retrievable
• Increased usage demands indexing and archiving
  all e-messages, e-files and web-related content
• Fines and penalties are levied for non-compliance
• Failure to have comprehensive solutions for
  multiple data types results in increased
  operational risk

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The Market Need...

• The largest financial institutions are well
  served by proven, quality software vendors
• BUTthe large firm model is expensive
• Purchase software CAPEX
• Install software in-house hire train staff,
  develop interfaces, manage operations, hardware,
  security, etc
• The ongoing operating expense is fixed
• Most financial institutions are under-served by
  this do-it-yourself model

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HTPs Solution...

• Compliance Operational Risk Management for the
  Enterprise (CORME) -- The Compliance Utility
• Based on Software-as-a-Service (SaaS)
• A quality solution for a fraction of the cost
  and risk

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HTPs Solution...The Compliance Utility
Benefits Financial Institutions

• Access to proven best-of-breed technology
  solutions otherwise not cost effective
• Low, variable cost
• No CAPEX--lower acquisition costs and overhead
• Functionality provided directly from a secure,
  SAS-70-compliant data center to ensure data
  integrity
• Less operational risk--no need to integrate,
  operate, monitor, maintain and upgrade
• Enables the financial institution to focus on its
  core business
• ...and benefits made possible by economies of
  scale

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The Functional Offering...

• Document and Message Management
• Compliance Officer Workbench
• Anti-money Laundering (AML) and Know Your
  Customer (KYC) product suite
• Server Management
• IT advisory services from Hudson Technology
  Partners--Chief Information Officer Support

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Explanation of Software-as-a-Service...

• Software-as-a-Service (SaaS), as popularized by
  Googles Gmail, Microsofts hotmail, and
  Salesforce.com
• A monthly subscription fee as an alternative to
  large, up-front licensing fees...pay as you go
• Access to same quality and robust solutions
  affordable by larger financial institutions, but
  without associated capital cost and staffing
  requirement--you dont generate your own
  electricity either
• Rapid implementation of software solutions
• With 24x7 maintenance and support, including
  always the most current updates
• Shift daily responsibility for IT infrastructure
  and support to a service provider
• Principals of HTP possess over 80-years
  experience in financial services and information
  technology, including Citibank, JPMorgan Chase,
  Bankers Trust , EDS and PwC

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The CORME Offering Details...
One-time Set-up Fee
Monthly Fee
Offering
Description
Document and Message Management
Pricing is Preliminary
15,000 for all access points
2,700 per access point
Email and IM Monitoring
Review and analysis of eMail and IM content, at
the access point, to determine if Corporate
Policies and legal mandates are being observed
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5,000
5 per mail box
Email Archiving and Retrieval
Email is indexed and searchable, greatly reducing
the time, cost and effort required to meet the
needs of legal discovery and associated business
requests
25,000
75 per user per desktop
Unstructured Document Archiving, Indexing and
Retrieval
An Indexing scheme that allows for the searching
of a large number of heterogeneous documents
based on complex search criteria, thus greatly
reducing the time and resources required to meet
both normal business needs and Legal Discovery
requirements
N/C
N/C if implemented as a SaaS
Access to and Audit Trail for Unstructured
Documents
Rules and restrictions regarding document access
as well as document editing, permissions, and
deletions. Maintaining a detailed audit trail of
who has done what to which documents and what the
changes were
10,000 if implemented as a SaaS
N/C if implemented as a SaaS
Back up and Recovery of Email, IM and
Unstructured Documents
Secure, off-site back-up of all documents on the
servers. Quick and efficient restoration
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The CORME Offering Details...
One-time Set-up Fee
Monthly Fee
Offering
Description
Compliance Officer Workbench
Pricing is Preliminary
TBD
TBD
A reporting and monitoring facility to allow a
Chief Compliance Officer, Chief Risk Officer
and/or Chief Operating Officer to monitor and be
alerted to changes in criteria they deem
necessary to determine the level of risk or
failure to comply with defined Compliance
guidelines
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Financial Industry-specific
10-15,000
400 for asset managers and hedge funds
Anti-money Laundering (AML)
Transaction monitoring to comply with Patriot Act
TBD
Included
Know Your Customer (KYC)
Meet regulatory requirements for new Account
Opening and creation of new or modified accounts
TBD
Included
Regulatory Reporting
Create and submit reports to Regulatory agencies
mandated reports. The actual reports and/or
messages is dependent upon the type of business
an example would be SARs (Suspicious Activity
Reports) associated with AML.
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The CORME Offering Details...
One-time Set-up Fee
Monthly Fee
Offering
Description
Consulting
Pricing is Preliminary
None
Project fee or Monthly Retainer
CIO/CTO Support
Assist customer leadership in making appropriate
technology decisions regarding their use of
Technology and Management for their Information
Environments.
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Server Management
TBD
TBD
Exchange and Lotus Notes
Maintain and administer the application and
servers, including updates to the software,
patches, restores permissions etc.
TBD
TBD
Shared Servers and Storage
Servers would include Applications, WEB, Data
Base etc. either in a Production mode or in some
instances the Development and or Test modes
TBD
TBD
Desk-Top Management
Backup with Restore Help Desk 24 X 7 support
via telephone Refresh Desktop Every 18, 24 or
36 months Virus and Spam Filtering Application
Installs, Version-updates,  and
Maintenance Permissions, Changes and Moves upon
authorized notification, remove or add peoples
mail boxes and access to shared drives and the
Internet
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The CORME Offering Details...
One-time Set-up Fee
Monthly Fee
Offering
Description
TBD
TBD
Network/LAN Management
Network / LAN Connectivity for new facilities,
arrange for the design and installation of LANS
and connectivity to the Internet.  In existing
facilities, we will assume responsibility for
bring the site up to agreed to standards, replace
obsolete or ineffective hardware and software and
be responsible for managing the process of
maintaining existing IP addresses and when
necessary mange the process of creating new IP
access points.  If requested, we will also add
the LAN configuration to our 24 X 7 monitoring
process and Help Desk support. VoIP Management
establish and mange the servers and associated
peripherals to establish a VoIP infrastructure
including new phone numbers and moves.
Monitoring of Network access points and
devices and when necessary make the appropriate
fixes, patches and upgrades.  If requested and
agreed to we will assume the role of managing the
process of interaction with both the Local, Long
Distance and Internet Carriers e.g. Sprint,
Verizon etc. Restore manage the process of
restoring lost Network connectivity
Pricing is Preliminary
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Summary...

• Meeting Todays Challenges
• Regulatory environment
• Increase in data and data types
• New technologies
• Evolution in software delivery methods
• Solution HTP will provide our clients with the
  capability to
• Meet their regulatory and compliance operating
  needs
• Reduce their cost of compliance and mitigate
  penalties for non-conformance
• Increase effectiveness and efficiency of the
  managing their business risk
• Focus on their core competencies
• We can begin right away

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Hudson Technology Partners Principals...
Phil Teplitzky, Managing Director. Phil has more
than 30-years experience in the management and
operations of information technology and
information technology consulting. He has been
involved in the day-to-day management of system
development projects, the establishment of
Standards Procedures and Guidelines for Software
Engineering, Quality Engineering and Change
Management at Citibank, SHL SystemHouse, The
VitaminShoppe.com, and Coopers Lybrand. He has
extensive experience in bringing new technologies
and software engineering disciplines into
day-to-day practice in the financial services
businesses. He has been the CIO at The Harry Fox
Agency, and the CTO at both The VitaminShoppe.com
and Mibrary. He has also been a Managing Director
of technology at SHL SystemHouse with
responsibility for its Northeast Region, a Vice
President of Technology at CitiBank, and a
National Director at Coopers Lybrand. Jonathan
Gross, Managing Director. Jonathan was previously
Senior Vice President and Managing Director of
Finance and Operations for DKR, a 4B hedge fund
and fund of funds. Jonathan has over 20 years of
professional experience in managing global
investment, securities and derivatives
organizations. Earlier, Jonathan was Managing
Director and Global Head of Operations and Client
Services and subsequently became Chief Operating
Officer at Zurich Capital Markets, the
alternative Asset Management firm. Prior to
joining Zurich Capital Markets, Jonathan was
Chief Financial Officer at a start-up hedge fund,
Goldrock Capital Management in New York where he
was responsible for developing, implementing and
managing the financial risk management,
accounting and operational infrastructure for the
firm. From 1995 to 2001, Jonathan was head of
Global Operations and subsequently became Chief
Financial Officer at Sanwa Financial Products
where he directed the global finance, operational
and administrative activities for their global
derivatives group. From 1987 to 1994, Jonathan
also held Senior Operational and Managerial
positions at Bankers Trust and Chase. Jonathan
graduated with honors from Baruch College with an
M.B.A. in Finance and Investments in 1982 and
received a B.S. from State University of New
York, Queens College in 1979.