##### 



UNITED
STATES  SECURITIES AND EXCHANGE COMMISSION
 WASHINGTON, D.C. 20549
 FORM 10-KSB
  þ
    
    ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
 For the fiscal year ended December 31, 2007
  o
    
    TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
 For the transition period from  to
 Commission file number 001-13753
 FirstPlus Financial Group, Inc.
 
  Nevada
    
    75-2561085(State or Other Jurisdiction 
of Incorporation or Organization)
    
    (I.R.S. Employer
Identification No.)122 W. John Carpenter Freeway, Suite 450 Irving, Texas
    
    75039(Address of Principal Executive Offices)
    
    (Zip Code)
  
    
 o
 þ o
 þ
 o þ
    o þ




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Table of Contents
 PagePART I
    
    
    
    
    2Item 1.
    
    Description of Business
    
    
    2Item 2.
    
    Description of Property
    
    
    14Item 3.
    
    Legal Proceedings
    
    
    14Item 4.
    
    Submission of Matters to a Vote of Security Holders
    
    
    15PART II
    
    
    
    
    17Item 5.
    
    Market for Common Equity, Related Stockholder Matters and Small Business Issuer Purchases of Equity Securities
    
    
    17Item 6.
    
    Managements Discussion and Analysis or Plan of Operation
    
    
    17Item 7.
    
    Financial Statements
    
    
    21Item 8.
    
    Changes in and Disagreements With Accountants on Accounting and Financial Disclosure
    
    
    21Item 8A(T).
    
    Controls and Procedures
    
    
    21Item 8B.
    
    Other Information
    
    
    22PART III
    
    
    
    
    23Item 9.
    
    Directors, Executive Officers, Promoters, Control Persons and Corporate Governance; Compliance With Section 16(a) of the Exchange Act
    
    
    23Item 10.
    
    Executive Compensation
    
    
    25Item 11.
    
    Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
    
    
    29Item 12.
    
    Certain Relationships and Related Transactions, and Director Independence
    
    
    30Item 13.
    
    Exhibits
    
    
    31Item 14.
    
    Principal Accountant Fees and Services
    
    
    31




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PART I
 Introductory Note
 Forward Looking Statements
   
 Item 1. Description of Business.
 Business Operations
   
  Rutgers Investment
  2




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FirstPlus Enterprises
   Olé Auto Group
   3




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##### 



FirstPlus Restoration
   Lives.
    FirstPlus Facility
   4




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##### 



FirstPlus Restoration & Facility (FirstPlus R&F)
    FirstPlus Development
     FirstPlus Acquisitions-1, Inc.
  The Premier Group, LLC
  5




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##### 



Principal Customers
  Growth Strategy
     Business History
  6




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Seasonality
  7




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Competition
 Rutgers Investment
   FirstPlus Enterprises
  Olé Auto Group
   FirstPlus Restoration
  FirstPlus Facility
  FirstPlus Development
  Intellectual Property
  8




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##### 



Regulation and Licensing
    Employees
  Risk Factors
 You should carefully consider the risk factors described below, together with the other information
contained in this and our other periodic filings with the Securities and Exchange Commission.
Please note that the risks and uncertainties described below are not the only ones facing our
Company. If any of the following situations actually occurs, our business, financial condition,
results of operations or prospects could be materially and adversely affected. This, in turn,
could cause the trading price of our common stock to decline and a loss of all or part of your
investment.
 Risks Related To Our Business and Industry
 We are an emerging company with a number of newly acquired businesses and a history of operating
losses. If we are unable to overcome the difficulties frequently encountered by early stage
companies, our business could be materially harmed.
  9




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##### 



We may have difficulty pursuing our acquisition strategy.
   Failure to integrate acquired companies and manage growth effectively may lead to losses.
   We may need to raise additional funds to pursue our acquisition strategy or continue our
operations.
    If we raise additional funds through the issuance of equity or convertible debt securities, the
ownership of current stockholders may be diluted.
  10




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##### 



We would be adversely affected if our operating subsidiaries lost certain licenses or if more
burdensome government regulations are enacted in the future.
    Our failure to attract and retain key personnel could harm our business.
   There may be significant fluctuations in our quarterly operating results and margins.
   11




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##### 



The business of FirstPlus Restoration depends to a large extent on its relationships with insurers
and insurance adjustors, which relationships may deteriorate.
  The business of FirstPlus Facility depends on short-term contracts that may not be renewed.
  The business of FirstPlus Development depends to a large extent on work generated through their
independent efforts and bidding process as well as the business it is supplied by FirstPlus
Restoration.
  Risks Related To Our Common Stock
 There is no established market for our common stock.
  Our common stock is considered a penny stock, and therefore may be subject to additional sale and
trading regulations that may make it more difficult to sell.
  The Market Price And Trading Volume Of Our Common Stock May Be Volatile.
   
    
    quarterly variations in operating results;
    
    changes in financial estimates by securities analysts;
 12




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
    
    changes in market valuations of other similar companies;
    
    announcements by us or our competitors of new products or of significant technical
innovations, contracts, acquisitions, strategic partnerships or joint ventures;
    
    additions or departures of key personnel;
    
    future sales of common stock;
    
    any deviations in net sales or in losses from levels expected by securities
analysts;
    
    depth and liquidity of the market for our common stock;
    
    speculation in the press or investment community; and
    
    general market and economic conditions.
  Our articles of incorporation and by-laws, as well as provisions of Nevada law, could prevent or
delay a change of control of our company and could limit the market price of our common stock.
  
    
    limitations on the ability of our stockholders to call special meetings of our
stockholders;
    
    procedural requirements that must be followed before nominations can be made for
election to our Board, and matters can be proposed by stockholders for consideration at
meetings of our stockholders;
    
    our Boards ability to designate and issue additional series of preferred stock with
such dividend, liquidation, conversion, voting or other rights, including the right to
issue convertible securities with no limitations on conversion and rights to dividends
and proceeds in a liquidation, that may be senior to our common stock;
    
    the existence of rights to purchase our Series C Junior Participating Preferred
Stock (such rights expiring on May 20, 2008, unless advanced or extended or otherwise
redeemed or exchanged by us), which rights may only be exercised upon the acquisition
of or manifestation of intent to acquire beneficial ownership of 15% or more of the
outstanding shares of our common stock, the holders of which Series C Junior
Participating Preferred Stock would become entitled to such amount of dividend
payments, voting power and liquidation preference that may discourage acquisition
proposals or delay or prevent a change in control; and
    
    Nevadas business combinations statutes, which prohibit business combinations with
any interested stockholder (defined as a beneficial owner of 10% or more of the
voting power of the outstanding shares of a corporation) for a three-year period
following the time such stockholder became an interested stockholder, which moratorium
can be lifted only by advance approval by our Board, and which, following the three
year period, only allow such combinations if (a) they are approved by the Board, the
disinterested stockholders or a majority of the outstanding voting power not
beneficially owned by the interested party, or (b) the interested stockholders satisfy
certain fair value requirements.
 13




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We may not pay dividends or make distributions on our common stock, including from the FirstPlus
Financial Group, Inc. Grantor residual trust.
  The
Creditor and Grantor Trust
 
 Item 2. Description of Property.
  
 Item 3. Legal Proceedings.
   14




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##### 



Item 4. Submission of Matters to a Vote of Security Holders.
  Election of Directors
  For
    
    Withhold AuthorityWilliam Handley
    
    
    23,500,929
    
    
    
    19,406,659John Maxwell
    
    
    23,508,908
    
    
    
    19,398,680Roger S. Meek
    
    
    23,561,032
    
    
    
    19,346,556Robert ONeal
    
    
    23,558,482
    
    
    
    19,349,106David Roberts
    
    
    23,486,429
    
    
    
    19,421,159
   Appointment of Independent Registered Public Accounting Firm
  For
    
    Against
    
    Abstain32,416,158
    
    
    8,668,988
    
    
    
    1,822,442
   15




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##### 



Stockholder Recommendation Regarding Payment of Dividend
  For
    
    Against
    
    Abstain5,701,568
    
    
    37,206,020
    
    
    
    -0-
   16




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##### 



PART II
 
 Item 5.
    
    Market for Common Equity, Related Stockholder Matters and Small Business Issuer Purchases
of Equity Securities.
 Market for Common Equity
  High
    
    
    LowFourth Quarter 2007
    
    $
    .25
    
    
    $
    .14Third Quarter 2007.
    
    
    .28
    
    
    
    .14Second Quarter 2007
    
    
    .34
    
    
    
    .15First Quarter 2007.
    
    
    .20
    
    
    
    .10Fourth Quarter 2006
    
    
    .12
    
    
    
    .06Third Quarter 2006.
    
    
    .15
    
    
    
    .07Second Quarter 2006
    
    
    .19
    
    
    
    .14First Quarter 2006.
    
    
    .21
    
    
    
    .16
     Dividends
  Equity Compensation Plan Information
  Number ofsecurities remainingNumber of
    
    
    
    
    
    available for futuresecurities to be
    
    Weighted-average
    
    issuance under equityissued upon exercise
    
    exercise price of
    
    compensation plansof outstanding
    
    outstanding
    
    (excluding securitiesoptions, warrants
    
    options, warrants
    
    reflected inand rights
    
    and rights
    
    column (a))(a)
    
    (b)
    
    (c)Equity compensation
plans approved by
security holdersEquity compensation
plans not approved
by security holders
    
    
    156,667
    
    
    $
    0.08
    
    
    
    0Total
    
    
    156,667
    
    
    $
    0.08
    
    
    
    0
 Stock Option Plan
    
 Item 6. Managements Discussion and Analysis or Plan of Operation.
 The following discussion of results of operations and financial condition is based upon, and
should be read in conjunction with, our consolidated financial statements and accompanying notes
thereto included elsewhere herein.
 Overview
  Results of Operations
 Year ended December 31, 2007 compared to the year ended December 31, 2006
   17




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Revenues
   Gross Profit (Loss)
  Operating Expenses
  18




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##### 



Other Income (Expense), Net
  Inventory
  Grantor Trust Income
  Business Acquisitions
  Liquidity and Capital Resources
    Entry Into New Businesses
  19




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##### 



The Creditor Trust and Grantor Trust
      Off-balance Sheet Arrangements
  20




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##### 



Critical Accounting Policies
 Principles of Consolidation :
  Income Taxes :
   Goodwill and Other Intangibles:
   Managements Estimates:
  
 Item 7. Financial Statements.
  
 Item 8. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure.
  
 Item 8A(T). Controls and Procedures.
  21




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
    
    the hiring of experienced risk management and accounting and financial reporting
consultants to assist the accounting and finance staff of the Company with ongoing
financial reporting obligations and the improvement of its internal controls over
financial reporting;
    
    the implementation of standardized processes and procedures, including the
centralization of the accounts payable and accounts receivable processes; and
    
    an increase in the number of accounting and financial reporting personnel at the
Company.
  Managements Report on Internal Controls over Financial Reporting
      
 Item 8B. Other Information.
  22




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##### 



Item 9. Directors, Executive Officers, Promoters, Control Persons and Corporate Governance;
Compliance With Section 16(a) of the Exchange Act.
  Name
    
    Age
    
    SinceGary D. Alexander
    
    
    54
    
    
    November 2007William Handley
    
    
    64
    
    
    June 2007John Maxwell
    
    
    55
    
    
    June 2007Roger S. Meek
    
    
    75
    
    
    August 2007Robert ONeal
    
    
    49
    
    
    June 2007Joseph P. Steward
    
    
    43
    
    
    November 2007
     23




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th
        24




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##### 



Item 10. Executive Compensation.
 SUMMARY COMPENSATION TABLE
 NonqualifiedNon-Equity
    
    
    DeferredStock
    
    
    Option
    
    
    Incentive Plan
    
    
    Compensation
    
    
    All OtherName and Principal
    
    
    
    
    
    Salary
    
    
    Bonus
    
    
    Awards
    
    
    Awards
    
    
    Compensation
    
    
    Earnings
    
    
    Compensation
    
    
    TotalPosition
    
    Year
    
    
    ($)
    
    
    ($)
    
    
    ($)
    
    
    ($)
    
    
    ($)
    
    
    ($)
    
    
    (7)($)
    
    
    ($)Daniel T. Phillips(1)
    
    
    2007
    
    
    
    20,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    20,000President, Chief Executive
Officer
    
    
    2006
    
    
    
    6,000
    
    
    
    60,000
    
    
    
    
    
    
    
    603
    
    
    
    
    
    
    
    
    
    
    
    12,000
    
    
    
    100,603Jack (J.D.) Draper(2)
    
    
    2007
    
    
    
    35,423
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    10,370
    
    
    
    46,793Executive Vice President
    
    
    2006
    
    
    
    59,847
    
    
    
    15,000
    
    
    
    
    
    
    
    603
    
    
    
    
    
    
    
    
    
    
    
    26,503
    
    
    
    101,950James Roundtree(3)
    
    
    2007
    
    
    
    20,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (8)
    
    
    
    3,073
    
    
    
    23,073Chief Financial Officer
    
    
    2006
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    0John Maxwell(5)
    
    
    2007
    
    
    
    119,143
    
    
    
    25,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    56,657
    
    
    
    200,799Chairman and Chief Executive
Officer
    
    
    2006
    
    
    
    0
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    0
    
    
    
    0Dr. Robert ONeal(5)
    
    
    2007
    
    
    
    15,384
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    15,384Chairman and Chief Operating
Officer
    
    
    2006
    
    
    
    0
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    0William Handley (6)
    
    
    2007
    
    
    
    72,431
    
    
    
    25,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    17,137
    
    
    
    114,568Chief Financial Officer,
Treasurer and Secretary
    
    
    2006
    
    
    
    0
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    0
    
    
    
    0
 
 (1)
    
    Mr. Phillips was removed, without cause, as Chief Executive Officer of the Company
on June 7, 2007. Upon Mr. Phillips separation from the Company on June 7, 2007, the
Board of Directors approved the acceleration of unvested stock options as was permitted
by the Companys Stock Option Plan (then in effect) all of which were exercisable until
August 6, 2007.(2)
    
    Mr. Draper died on December 5, 2007.(3)
    
    Mr. Roundtree was removed, without cause, as Chief Financial Officer of the Company on June 7, 2007. 25




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(4)
    
    Mr. Maxwell was appointed as Chief Executive Officer on June 7, 2007 and Chairman of
the Board of Directors on November 13, 2007. Mr. Maxwell was paid a performance bonus of
$25,000 for 2007.(5)
    
    Dr. ONeal was appointed as President and Chief Operating Officer on November 13, 2007.(6)
    
    Mr. Handley was appointed Chief Financial Officer of the Company on June 7, 2007.
Mr. Handley was paid a performance bonus of $25,000 for 2007.(7)
    
    Other compensation consists housing allowance, car allowance and insurance premium
payments for Messrs. Maxwell and Handley of $40,883 $9,689, $6,085, $9,205, $4,700 and
$3,412, respectively. For Mr. Draper, Other Compensation consists of car allowance payments of $1,207 and insurance premium payments of $9,163 and for Mr. Roundtree insurance
premium payments of $3,073.   Option AwardsNumber of Securities
    
    Number of SecuritiesUnderlying
    
    UnderlyingUnexercised Options
    
    Unexercised Options
    
    Option Exercise
    
    Option ExpirationName
    
    (#) Exercisable
    
    (#) Unexercisable
    
    Price ($)
    
    DateJack (J.D.) Draper(1)
    
    
    156,667
    
    
    
    156,667
    
    
    
    .08
    
    
    
    12/12/16
 
 (1)
    
    Mr. Draper died on December 5, 2007 and such option awards are held by his estate.    
    
    determining the compensation of the Chairman and Chief Executive Officer of the Company,
    
    upon recommendation of the Chief Executive Officer, reviewing and
approving any other executive officers compensation; and
    
    reviewing, approving and granting awards under any stock incentive
plans.
  26




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
    
    establishing objectives for compensation,
    
    defining appropriate competitive reference points,
    
    creating an appropriate linkage between compensation programs and
Company objectives and values,
    
    describing the roles of various elements of compensation, and
    
    maintaining good governance practices concerning compensation.
        27




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##### 



Change inPensionFees
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Value andEarned
    
    
    
    
    
    
    
    
    
    
    Non-Equity
    
    
    Nonqualifiedor Paid in
    
    
    Stock
    
    
    Option
    
    
    Incentive Plan
    
    
    Deferred
    
    
    All OtherCash
    
    
    Awards
    
    
    Awards
    
    
    Compensation
    
    
    Compensation
    
    
    Compensation
    
    
    TotalName
    
    ($)(1)
    
    
    ($)
    
    
    ($)
    
    
    ($)
    
    
    Earnings ($)
    
    
    ($)(2)
    
    
    ($)Roger S. Meek
    
    
    12,500Dr. Robert ONeal
    
    
    25,000Joseph P. Steward
    
    
    26,000Gary D. Alexander
    
    
    5,000Harold Garber3
    
    
    25,000Robert P. Freeman
    
    
    4,500John R. Fitzgerald
    
    
    3,000David B. Ward
    
    
    3,000James Roundtree
    
    
    7,500Jack Draper
    
    
    7,500
 28




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##### 



(1)
    
    In 2007, the Company paid directors $1,500 for each meeting in which they
participated. The Company did not pay directors who were also employees of
the Company any additional compensation for their service as directors,
except for the reimbursement of expenses incurred in attending meetings. Dr. Robert ONeals
director fees were paid prior to his appointment on November 13, 2007 as President and Chief
Operating Officer of the Company. Directors were also eligible to receive stock options for their service as Directors.For 2007 non-employee directors each received annual compensation of $52,000,
payable quarterly, for their service on the Companys Board of Directors, Audit
Committee and Compensation Committee, comprising $30,000 in directors fees and
$22,000 in committee fees. William Handley, John Maxwell and Dr. Robert ONeal (upon his
appointment as President and Chief Operating Officer) did not receive any additional compensation
for serving on the Companys Board of Directors.(2)
    
    On September 23, 2007, Messrs. Phillips, Roundtree, and Fitzgerald released the Company from any severance or
other payments by virtue of, among other items, their June 7,
2007 resignation from the Companys Board of Directors.(3)
    
    Attorney Harold Garber served on the FirstPlus Board of Directors from June 2007 until the
time of his death in August, 2007. 
 Item 11.
    
    Security Ownership of Certain Beneficial Owners and Management and Related Stockholder
Matters.
  Percent ofName and Address of Beneficial Owner
    
    Shares Owned
    
    Class(1)5% STOCKHOLDERSDeutsche Bank AG(2)
    
    
    2,994,5000
    
    
    
    6.00
    %Rupen Gulenyan(3)
    
    
    3,488,300
    
    
    
    7.0
    %Robert ONeal(4)
    
    
    2,530,300
    
    
    
    5.1
    %
 29




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##### 



Percent ofName and Adress of Beneficial Owner
    
    Shares Owned
    
    Class(1)NAMED EXECUTIVE OFFICERS AND DIRECTORSWilliam Handley
    
    
    0
    
    
    
    *John Maxwell
    
    
    0
    
    
    
    *Roger S. Meek
    
    
    0
    
    
    
    *Robert ONeal
    
    
    2,530,300
    
    
    
    5.1
    %Gary Alexander(5)
    
    
    3,200
    
    
    
    *Joseph Steward
    
    
    0
    
    
    
    *All directors and officers as a group (6 persons)(4)
    
    
    2,533,500
    
    
    
    5.1
    %
 
 *
    
    Indicates less than one percent (1%).(1)
    
    Except as otherwise indicated, the persons named in the table possess sole voting and
investment power with respect to all shares of common stock shown as beneficially owned by them.
Beneficial ownership as reported in the above table has been determined
according to Rule 13d-3 of the Securities Exchange Act of 1934, as amended
(the Exchange Act).(2)
    
    According to Schedule 13G/A, filed on February 1, 2008. The address of the
filing person is Theodor-Heuss-Allee 70 60468 Frankfurt am Main, Federal
Republic of Germany.(3)
    
    According to Schedule 13D/A, filed on March 23, 2006. Mr. Gulenyans
address is 3040 E. Tremont Ave., Suite 201, Bronx, New York 10461.(4)
    
    According to Schedule 13G filed on February 5, 2008. Mr. ONeals address is c/o FirstPlus
Financial Group 122 W. John Carpenter Freeway, Suite 450, Irving, Texas 75039-2001.(5)
    
    Mr. Alexanders son holds 1,000 shares of common stock. 
 Item 12.
    
    Certain Relationships and Related Transactions, and Director Independence.
    30




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##### 



Item 13. Exhibits
  
 Item 14. Principal Accountant Fees and Services
     December 31, 2007
    
    December 31, 2006(i) Audit Fees
    
    $
    33,500
    
    
$
    67,592
    (Prior Auditors Fees)(ii) Audit Related Fees
    
    $
    7,500
    
    
    $
    0(iii) Tax Fees
    
    $
    0
    
    
    $
    0(iv) All Other Fees
    
    $
    0
    
    
    $
    0
  31




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##### 



SIGNATURES
  Date: March 31, 2008
    FIRSTPLUS FINANCIAL GROUP, INC.By:
    /s/ John MaxwellJohn MaxwellChief Executive Officer and Director/s/ William HandleyWilliam HandleyChief Financial Officer and Director  Signature
    
    Title
    
    Date/s/ Robert ONeal
Robert ONeal
    
    Director
    
    March 31, 2008/s/ Roger S. Meek
Roger S. Meek
    
    Director
    
    March 31, 2008/s/ Joseph Steward
Joseph Steward
    
    Director
    
    March 31, 2008/s/ Gary Alexander
Gary Alexander
    
    Director
    
    March 31, 2008
 32




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##### 



INDEX TO EXHIBITS
 Exhibit No.
    
    Description2.1
    
    
    Modified Third Amended Plan of Reorganization of FirstPlus Financial, Inc. (2)2.2
    
    
    Trust Agreement for the FPFI Creditor Trust (2)3.1
    
    
    Amended and Restated Articles of Incorporation, as amended (2)3.2
    
    

Second
Amended and Restated Bylaws (2)4.1
    
    
    Rights Agreement, dated as of May 20, 1998, between FirstPlus Financial Group, Inc. and
ChaseMellon Shareholder Services, L.L.C. (1)4.1.1
    
    
    First Amendment to Rights Agreement, dated as of October 25, 2001, between FirstPlus
Financial Group, Inc. and Mellon Investor Services LLC (2)4.1.2
    
    
    Second Amendment to Rights Agreement, dated as of June 27, 2002, between FirstPlus Financial
Group, Inc. and Mellon Investor Services LLC (2)4.2
    
    
    Certificate of Designation of Series C Junior Participating Preferred Stock (1)4.3
    
    
    FirstPlus Financial Group, Inc. Grantor Residual Trust Agreement, dated July 15, 2002 (2)4.4
    
    
    Supplemental Indenture, dated as of December 4, 2000, by and between FirstPlus Financial
Group, Inc. and HSBC Bank USA (2)4.5
    
    
    Form of Certificate of Certificated Interests Representing Beneficial Interests in The FPFI
Creditor Trust Exchanged For 7.25% Convertible Subordinated Notes Due 2003 (2)10.1
    
    
    Agreement for Settlement between Bear Stearns & Co., Inc. and FirstPlus Financial Group,
Inc., dated August 19, 1999 (2)10.2
    
    
    Conversion Agreement, dated as of June ___, 2001, by and between FirstPlus Financial Group,
Inc., and the Certificateholders signatory thereto (2)10.3
    
    
    Letter Agreement, dated June 13, 2001, by FirstPlus Financial Group, Inc. and accepted by
FPFI Creditors Trust (2)10.4
    
    
    Stipulation and Agreement of Settlement, dated as of July 30, 2003, between Class
Representative Edward P. Doremus, III, Milberg Weiss Bershad Hynes & Lerach LLP, Sirota &
Sirota LLP, FirstPlus Financial Group, Inc., Daniel T. Phillips, Eric C. Green, Haynes and
Boone, LLP and National Union Fire Insurance Company of Pittsburgh, PA (2)10.5
    
    
    Escrow Agreement, dated as of July 30, 2003, by and among FirstPlus Financial Group, Inc.,
Class Representative Edward P. Doremus, III, Milberg Weiss Bershad Hynes & Lerach LLP and
Sirota & Sirota LLP (2)10.6
    
    
    Assignment and Assumption Agreement, dated as of July 30, 2003, by and between FirstPlus
Financial Group, Inc., Class Representative Edward P. Doremus, III, Milberg Weiss Bershad
Hynes & Lerach LLP and Sirota & Sirota LLP (2)10.7
    
    
    Registration Rights Agreement, dated as of July 30, 2003, by and among FirstPlus Financial
Group, Inc., Capital Lending Strategies, LLC, Class Representative Edward P. Doremus, III,
Milberg Weiss Bershad Hynes & Lerach LLP and Sirota & Sirota LLP (2)10.8
    
    
    Promissory Note, dated December 20, 2004, by United Lending Partners, LP in favor of
FirstPlus Financial (2)10.9
    
    
    Subordination Agreement, dated December 30, 2004, by and between FirstPlus Financial Group,
Inc. and United Lending Partners, LP (2)10.10
    
    
    Settlement Agreement and Mutual Release of Any and All Claims, dated October 12, 2001, by
Thaxton Investment Corporation and FirstPlus Financial Group, Inc. (2)10.11
    
    
    Settlement Agreement, dated as of April 6, 2006, by and among FirstPlus Financial Group,
Inc. and Danford L. Martin, individually, on behalf of the FPFX Shareholder Value Committee
and the
 33




---



##### 



Exhibit No.
    
    DescriptionFPFX Steering Committee and as attorney-in-fact for all of the Petitioners in the
Election Suit (as defined therein) (3)10.12
    
    
    Factoring Agreement and Security Agreement, dated February 28, 2006, between Signs For Life,
LLC and FirstPlus Financial Group, Inc. (3)10.13
    
    
    First Amended FirstPlus Financial Group, Inc. Grantor Residual Trust Agreement, dated July
6, 2006 by FirstPlus Financial Group, Inc. as the sole settlor and the sole beneficiary (4)10.14
    
    
    Asset Purchase Agreement, dated as of November 3, 2006, by and between FirstPlus Auto Group,
Inc. and Eddie Perkins (5)10.15
    
    
    Asset Purchase Agreement, dated July 23, 2007, by and among Rutgers Investment Group, LLC,
Learned Associates of North America, LLC, Seven Hills Management, LLC, Peter S. Fox and
Rutgers Investment Group, Inc. (6)10.16
    
    
    Agreement for Purchase and Sale of Membership Interests, dated July 30, 2007, by and among
Globalnet Enterprises, LLC and its members (Learned Associates of North America, LLC, Seven
Hills Management, LLC, Diversified Development LLC, and Ajax Baron, LLC), FirstPlus
Enterprises, Inc. and FirstPlus Development Company (7)10.17
    
    
    Promissory Note in the amount of $1,495,000.00 made by FirstPlus Development Company and
FirstPlus Enterprises, Inc. to Globalnet Enterprises, LLC (8)10.18
    
    
    Employment Agreement, dated August 27, 2007, by and between FirstPlus Financial Group, Inc.
and William Handley (8)10.19
    
    
    Employment Agreement, dated November 13, 2007, by and between FirstPlus Financial Group,
Inc. and Robert ONeal (9)10.20
    
    
    Amended and Restated Employment Agreement, dated November 13, 2007, by and between FirstPlus
Financial Group, Inc. and John Maxwell (9)10.21*
    
    

Collateral
Pledge Agreement and Subordinated Debenture dated December 31, 2007 between Rutgers Investment Group and FirstPlus Financial
Group14.1*
    
    
    FirstPlus Financial Group, Inc. Code of Ethics21.1*
    
    
    Subsidiaries of FirstPlus Financial Group, Inc.31.1*
    
    
    Certification of Principal Executive Officer pursuant to Section 302(a) of the
Sarbanes-Oxley Act of 200231.2*
    
    
    Certification of Principal Financial Officer pursuant to Section 302(a) of the
Sarbanes-Oxley Act of 200232.1*
    
    
    Certification of Principal Executive Officer of Periodic Report Pursuant to Section 906 of
Sarbanes-Oxley Act of 2002
 34




---



##### 



Exhibit No.
    
    Description32.2*
    
    
    Certification of Principal Financial Officer of Periodic Report Pursuant to Section 906 of
Sarbanes-Oxley Act of 2002
 
 *
    
    Filed Herewith(1)
    
    Incorporated by reference to the exhibits included with our Current Report on Form 8-K filed
as of May 29, 1998.(2)
    
    Incorporated by reference to the exhibits included with our Current Report on Form 10-KSB for
the year ended December 31, 2004.(3)
    
    Incorporated by reference to the exhibits included with our Quarterly Report on Form 10-QSB
for the quarterly period ended March 31, 2006.(4)
    
    Incorporated by reference to the exhibits included with our Quarterly Report on Form 10-QSB
for the quarterly period ended June 30, 2006.(5)
    
    Incorporated by reference to the exhibits included with our Quarterly Report on Form 10-QSB
for the quarterly period ended September 30, 2006.(6)
    
    Incorporated by reference to the exhibits included with our Current Report on Form 8-K filed
with the SEC on July 24, 2007.(7)
    
    Incorporated by reference to the exhibits included with our Current Report on Form 8-K filed
with the SEC on August 2, 2007.(8)
    
    Incorporated by reference to the exhibits included with our Current Report on Form 8-K filed
with the SEC on August 31, 2007, as amended.(9)
    
    Incorporated by reference to the exhibits included with our Current Report on Form 8-K filed
with the SEC on November 14, 2007. 35




---



##### 



FIRSTPLUS FINANCIAL GROUP, INC.
 ITEM 7. FINANCIAL STATEMENTS.Report of Independent Registered Public Accounting Firm
    
    
    F-1Consolidated Balance Sheets as of December 31, 2007 and 2006
    
    
    F-2Consolidated Statements of Operations for the Years Ended
December 31, 2007 and 2006
    
    
    F-3Consolidated Statements of Shareholders Equity for the Years Ended
December 31, 2007 and 2006
    
    
    F-4Consolidated Statements of Cash Flows for the Years Ended December 31, 2007 and 2006
    
    
    F-5  F-6Notes to Consolidated Financial Statements
    
    
    F-7  F-18




---



##### 



/s/ Buckno Lisicky & Company, PCAllentown, PennsylvaniaMarch 26, 2008 F-1




---



##### 



FIRSTPLUS FINANCIAL GROUP, INC.
  
 CONSOLIDATED BALANCE SHEETS
 December
    
    
    December31, 2007
    
    
    31, 2006ASSETS:Cash and cash equivalents
    
    $
    2,615,260
    
    
    $
    13,021,978Accounts receivable, net of allowances
    
    
    3,441,208
    
    
    
    0Other receivables, factors
    
    
    558,864
    
    
    
    0Inventory
    
    
    612,341
    
    
    
    566,145Prepaid expenses
    
    
    273,637
    
    
    
    29,643Tax refund receivable
    
    
    16,000
    
    
    
    0Total current assets
    
    
    7,517,310
    
    
    
    13,617,766Land
    
    
    1,040,000
    
    
    
    0Property and
equipment (net of accumulated depreciation of $155,274 and
$716)
    
    
    3,681,048
    
    
    
    24,578Accounts receivable Capital Lending Strategies, LLC
    
    
    0
    
    
    
    82,343Notes receivable
    
    
    347,316
    
    
    
    481,473Security deposits
    
    
    71,117
    
    
    
    23,000Advance  Home Loan Advisors
    
    
    70,000
    
    
    
    0Employee advances
    
    
    31,206
    
    
    
    0Goodwill
    
    
    5,447,998
    
    
    
    0Claim from bankruptcy estate
    
    
    0
    
    
    
    2,341,761Licenses and trademarks, net of accumulated amortization of $3,110
    
    
    35,625
    
    
    
    0Deferred tax asset
    
    
    1,379,315
    
    
    
    93,300Investment in Capital Lending Strategies, LLC
    
    
    0
    
    
    
    71,150Total assets
    
    $
    19,620,935
    
    
    $
    16,735,371LIABILITIES
AND STOCKHOLDERS EQUITY:Line of credit
    
    $
    1,000,000
    
    
    $
    0Accounts payable
    
    
    298,069
    
    
    
    0Income taxes payable
    
    
    0
    
    
    
    113,864Accrued expenses
    
    
    1,000,239
    
    
    
    171,739Billings in excess of costs and estimated earnings on uncompleted contracts
    
    
    90,994
    
    
    
    0Deferred revenue
    
    
    44,261
    
    
    
    0Notes payable
    
    
    720,000
    
    
    
    312,000Total current liabilities
    
    
    3,153,563
    
    
    
    597,603Commitments and contingencies
    
    
    0
    
    
    
    3,083,760Stockholders equity:Common stock, $.01 par value, 101,000,000 shares authorized; 49,845,100 and
48,245,090 shares issued and outstanding at December 31, 2007 and 2006
    
    
    498,451
    
    
    
    482,451Additional paid in capital
    
    
    17,574,354
    
    
    
    17,306,123Retained earnings (deficit) since December 31, 2002 when a deficit of
$312,527,864 was eliminated in connection with a quasi-reorganization
    
    
    (1,605,433
    )
    
    
    (4,734,566
    )Total stockholders equity
    
    
    16,467,372
    
    
    
    13,054,008Total liabilities and stockholders equity
    
    $
    19,620,935
    
    
    $
    16,735,371
  F-2




---



##### 



FIRSTPLUS FINANCIAL GROUP, INC.
 CONSOLIDATED STATEMENTS OF OPERATIONS
 For the Years EndedDecember 31,2007
    
    
    2006Revenues
    
    $
    18,508,592
    
    
    $
    25,692Cost of goods sold
    
    
    9,089,355
    
    
    
    0Gross profit
    
    
    9,419,237
    
    
    
    25,692Operating expenses:General and administrative
    
    
    7,699,149
    
    
    
    3,069,053Total operating expenses
    
    
    7,699,149
    
    
    
    3,069,053Operating income (loss)
    
    
    1,720,088
    
    
    
    (3,043,361
    )Non-operating income/(loss):Release of creditor claims
    
    
    3,450,000
    
    
    
    0Discounts on sale of notes
    
    
    (191,328
    )
    
    
    0Cancellation of debt  Shore Escapes
    
    
    30,351
    
    
    
    0Loss on investment  Capital Lending
    
    
    (71,150
    )Versatile Consulting LLC
    
    
    0
    
    
    
    (466,701
    )Interest, net
    
    
    359,002
    
    
    
    412,621Professional fees and other costs for acquisitions
    
    
    (3,543,900
    )
    
    
    0Income (loss) before provision for income taxes
    
    
    1,753,063
    
    
    
    (3,097,441
    )Provision for income taxes/(benefit)
    
    
    (1,376,070
    )
    
    
    Net income (loss)
    
    $
    3,129,133
    
    
    $
    (3,097,441
    )Earnings (loss) per share
    
    $
    0.07
    
    
    $
    (0.07
    )Weighted average of common shares outstanding
    
    
    48,617,251
    
    
    
    45,019,542
  F-3




---



##### 



FIRSTPLUS FINANCIAL GROUP, INC.
 
 CONSOLIDATED STATEMENTS OF STOCKHOLDERS EQUITY
 Number
    
    
    
    
    
    
    Additional
    
    
    Retained
    
    
    Totalof
    
    
    Common
    
    
    Paid-in
    
    
    Earnings
    
    
    StockholdersShares
    
    
    Stock
    
    
    Capital
    
    
    (Deficit)
    
    
    EquityBalance, January 1, 2006
    
    
    45,340,090
    
    
    $
    453,401
    
    
    $
    11,490,171
    
    
    $
    (1,637,125
    )
    
    $
    10,306,447Issuance of stock on conversion of
certificated interests
    
    
    2,905,000
    
    
    
    29,050
    
    
    
    (29,050
    )
    
    
    
    
    
    
    Revaluation of amounts adjusted in
quasi-reorganization
(notes 4, 5 and 6)
    
    
    
    
    
    
    
    
    
    
    9,460,250
    
    
    
    
    
    
    
    9,460,250Stock based compensation
    
    
    
    
    
    
    
    
    
    
    3,616
    
    
    
    
    
    
    
    3,616Dividends paid
    
    
    
    
    
    
    
    
    
    
    (3,618,864
    )
    
    
    
    
    
    
    (3,618,864
    )Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (3,097,441
    )
    
    
    (3,097,441
    )Balance, December 31, 2006
    
    
    48,245,090
    
    
    
    482,451
    
    
    
    17,306,123
    
    
    
    (4,734,566
    )
    
    
    13,054,008Issuance of common stock
    
    
    876,810
    
    
    
    16,000
    
    
    
    260,999
    
    
    
    
    
    
    
    276,999Stock based compensation
    
    
    723,200
    
    
    
    
    
    
    
    7,232
    
    
    
    
    
    
    
    7,232Dividends paid
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,129,133
    
    
    
    3,129,133Balance, December 31, 2007
    
    
    49,845,100
    
    
    $
    498,451
    
    
    $
    17,574,354
    
    
    $
    (1,605,433
    )
    
    $
    16,467,372
  F-4




---



##### 



FIRSTPLUS FINANCIAL GROUP, INC.
 CONSOLIDATED STATEMENTS OF CASH FLOWS
 For the Years EndedDecember 31,2007
    
    
    2006Cash flows from operating activities:Net income (loss)
    
    $
    3,129,133
    
    
    $
    (3,097,441
    )Adjustments to reconcile net income (loss) to net cash provided by
(used in) operating activities:Allowance for bad debts
    
    
    948,724
    
    
    
    0Deferred income taxes
    
    
    (1,376,070
    )
    
    
    93,300Depreciation and amortization
    
    
    157,667
    
    
    
    717Stock based compensation
    
    
    7,232
    
    
    
    3,616Loss on Versatile Consulting LLC (see note 4)
    
    
    0
    
    
    
    466,701Loss on investment  Capital Lending
    
    
    71,150
    
    
    
    0Changes in operating assets and liabilities:Accounts receivable
    
    
    (4,389,937
    )
    
    
    0Other receivables, factors
    
    
    (558,864
    )
    
    
    0Inventory
    
    
    (46,196
    )
    
    
    (566,145
    )Prepaid expenses
    
    
    (243,994
    )
    
    
    (29,643
    )Security deposits
    
    
    (48,117
    )
    
    
    (23,000
    )Notes receivable
    
    
    134,157
    
    
    
    (481,473
    )Advances  Home Loan Advisors
    
    
    (70,000
    )
    
    
    0Employee advances
    
    
    (31,206
    )
    
    
    0Accounts payable
    
    
    298,069
    
    
    
    0Accrued expenses
    
    
    828,500
    
    
    
    10,529Income taxes payable
    
    
    (113,864
    )
    
    
    20,564Billings in excess of costs and estimated earnings on uncompleted contracts
    
    
    90,994
    
    
    
    0Deferred revenue
    
    
    44,261
    
    
    
    0Commitments and contingencies
    
    
    (3,450,000
    )
    
    
    0Net cash used in operating activities
    
    
    (4,618,361
    )
    
    
    (3,695,575
    )Cash flows from investing activities:Collection on bankruptcy estate claim
    
    
    2,341,761
    
    
    
    16,029,933Commitment on bankruptcy estate claim
    
    
    366,240
    
    
    
    3,083,760Collections on line of credit Capital Lending Strategies LLC
    
    
    82,143
    
    
    
    35,443Purchase of fixed assets
    
    
    (3,145,164
    )
    
    
    (25,294
    )Purchase of land
    
    
    (1,040,000
    )
    
    
    0Purchase of licenses and trademarks
    
    
    (39,070
    )
    
    
    0Acquisition of Rutgers Investment Group, LLC
    
    
    (1,915,000
    )
    
    
    0Acquisition of Globalnet Enterprises, LLC
    
    
    (3,547,498
    )
    
    
    0Receipt of state refund  net
    
    
    0
    
    
    
    62,881Versatile Consulting, LLC
    
    
    
    
    
    
    (466,701
    )Net cash provided by (used in) investing activities
    
    
    (6,896,588
    )
    
    
    18,720,022
  F-5




---



##### 



FIRSTPLUS FINANCIAL GROUP, INC.
 
 CONSOLIDATED STATEMENTS OF CASH FLOWS
 For the Years EndedDecember 31,2007
    
    
    2006Cash flows from financing activities:Proceeds from line of credit
    
    
    1,000,000
    
    
    
    0Note Payable  First Plus Restoration
    
    
    16,000
    
    
    
    0Note payable  Olé Auto Group
    
    
    (192,000
    )
    
    
    312,000Issuance of common stock
    
    
    284,231
    
    
    
    0Dividends paid
    
    
    0
    
    
    
    (3,618,864
    )Net cash provided by (used in) financing activities
    
    
    1,108,231
    
    
    
    (3,306,864
    )Net increase (decrease) in cash
    
    
    (10,406,718
    )
    
    
    11,717,583Cash at the beginning of the year
    
    
    13,021,978
    
    
    
    1,304,395Cash at the end of the year
    
    $
    2,615,260
    
    
    $
    13,021,978Supplemental disclosure of cash flow information:Cash paid for:Interest
    
    $
    
    
    
    $
    1,289Taxes
    
    $
    
    
    
    $
    19,600Non-cash investing and financing activities:Building acquired with note payable
    
    $
    600,000
    
    
    $
    0
  F-6




---



##### 



FIRSTPLUS FINANCIAL GROUP, INC.  Notes to the Consolidated Financial Statements
 1. Description of the Company
   Rutgers Investment
   FirstPlus Development
  F-7




---



##### 



FIRSTPLUS FINANCIAL GROUP, INC.  Notes to the Consolidated Financial Statements
    FirstPlus
Acquisitions-1, Inc.
  FirstPlus Enterprises
   Olé Auto Group
  F-8




---



##### 



FIRSTPLUS FINANCIAL GROUP, INC.  Notes to the Consolidated Financial Statements
   FirstPlus Restoration
     FirstPlus Facility
  F-9




---



##### 



FIRSTPLUS FINANCIAL GROUP, INC.  Notes to the Consolidated Financial Statements
  FirstPlus Restoration & Facilities Services
    2. Summary of Significant Accounting Policies
 Principles of Consolidation:
  Revenue Recognition:
   Cash and Cash Equivalents:
  F-10




---



##### 



FIRSTPLUS FINANCIAL GROUP, INC.  Notes to the Consolidated Financial Statements
 Loans and Allowance for Loan Losses:
  Accounts
Receivable and Allowance for Bad Debts:
  Inventory:
  Property, Plant & Equipment:
  Concentration of Credit Risk:
  Income Taxes:
   Managements Estimates:
  F-11




---



##### 



FIRSTPLUS FINANCIAL GROUP, INC.  Notes to the Consolidated Financial Statements
 Quasi-reorganization:
   Goodwill and Other Intangibles:
   3. Other Assets
      F-12




---



##### 



FIRSTPLUS FINANCIAL GROUP, INC.  Notes to the Consolidated Financial Statements
 4. Commitments and Contingencies
    Year Ending December 31
    
    Amount2008
    
    $
    303,9122009
    
    
    303,9122010
    
    
    303,9122011
    
    
    303,9122012
    
    
    0Thereafter
    
    
    0$
    1,215,648
   F-13




---



##### 



FIRSTPLUS FINANCIAL GROUP, INC.  Notes to the Consolidated Financial Statements
 5. Stockholders Equity
  6. Stock-based Compensation
   7. Business Acquisitions
      F-14




---



##### 



FIRSTPLUS FINANCIAL GROUP, INC.  Notes to the Consolidated Financial Statements
      8. Property and Equipment
  2007
    
    
    2006Buildings and improvements
    
    $
    1,473,411
    
    
    $
    0Airplane
    
    
    618,000
    
    
    
    0Vehicles
    
    
    72,000
    
    
    
    0Furniture, fixtures and equipment
    
    
    1,672,911
    
    
    
    25,2943,836,322
    
    
    
    25,294Less accumulated depreciation
and amortization
    
    
    155,274
    
    
    
    716$
    3,681,048
    
    
    $
    24,578
  F-15




---



##### 



FIRSTPLUS FINANCIAL GROUP, INC.  Notes to the Consolidated Financial Statements
 9. Line of Credit
 1 2
 10. Notes Payable
    11. Income Taxes
  Deferred:Federal
    
    $
    13,793,147Increase in valuation allowance
    
    
    (12,413,832
    )Other
    
    
    3,245Income tax benefit
    
    $
    (1,376,070
    )
  Deferred tax asset:Net operating loss
    
    $
    13,901,417Deferred tax liability:Property and equipment
    
    
    (108,270
    )13,793,147Less valuation allowance
    
    
    12,413,832Net deferred tax asset
    
    $
    1,379,315
  F-16




---



##### 



FIRSTPLUS FINANCIAL GROUP, INC.  Notes to the Consolidated Financial Statements
  Note 12. Segment Information
   FirstPlusFinancial
    
    Ole AutoGroup, Inc.
    
    Group, Inc.Net Revenues
    
    $
    6,239,997
    
    
    $
    10,697,616Operating expenses
    
    
    5,715,961
    
    
    
    11,494,447Other income (expense)
    
    
    5,149,368
    
    
    
    (191,328
    )Pre-tax earnings (loss)
    
    
    5,673,404
    
    
    
    (988,159
    )
 Note 13. Quarterly Results of Operations (unaudited)
  First
    
    Second
    
    Third
    
    Fourth2007Sales
    
    $
    1,430,783
    
    
    $
    4,770,312
    
    
    $
    1,959,509
    
    
    $
    10,347,988Gross profit
    
    
    478,284
    
    
    
    1,771,875
    
    
    
    383,801
    
    
    
    6,785,777Net income (loss)
    
    
    (81,059
    )
    
    
    (53,936
    )
    
    
    132,364
    
    
    
    3,131,764Net income (loss) per
common share
    
    
    0.00
    
    
    
    0.00
    
    
    
    0.03
    
    
    
    0.042006Sales
    
    $
    0
    
    
    $
    0
    
    
    $
    0
    
    
    $
    25,692Gross profit
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    25,692Net income (loss)
    
    
    (249,337
    )
    
    
    (1,356,406
    )
    
    
    (508,487
    )
    
    
    (983,211
    )Net income (loss) per
common share
    
    
    (0.01
    )
    
    
    (0.03
    )
    
    
    (0.01
    )
    
    
    (0.02
    )
 F-17




---



##### 



FIRSTPLUS FINANCIAL GROUP, INC.  Notes to the Consolidated Financial Statements
 14. Recent Accounting Pronouncements
  15. Subsequent Events
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      F-18