UNITED
      STATES


SECURITIES
      AND EXCHANGE COMMISSION





WASHINGTON,
      D.C. 20549




FORM
        10-KSB





ANNUAL
      REPORT PURSUANT TO SECTION 13 OR 15(D)


OF
      THE
      SECURITIES EXCHANGE ACT OF 1934, AS AMENDED


FOR
      THE
      YEAR ENDED DECEMBER 31, 2007





COMMISSION
      FILE NUMBER 0-28606











(EXACT
      NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)





NEVADA
            22-3387630(STATE
                OR OTHER JURISDICTION
            (IRS
                EMPLOYER IDENTIFICATION NO.)OF
                INCORPORATION OR ORGANIZATION)





109
                NORTH POST OAK LANE, SUITE 422HOUSTON,
                TEXAS
            77024(ADDRESS
                OF PRINCIPAL EXECUTIVE OFFICES)
            (ZIP
                CODE)





(713)
      621-2737





(REGISTRANT'S
      TELEPHONE NUMBER, INCLUDING AREA CODE)





Securities
      registered pursuant to Section 12(b) of the Act:





NONE





Securities
      registered pursuant to Section 12(g) of the Act:





COMMON
      STOCK PAR VALUE $0.001 PER SHARE


(TITLE
      OF
      CLASS)





Indicate
      by check mark whether the issuer is not required to file reports pursuant
      to Section 13 or 15(d) of the Exchange Act.





Yes  ̈ No x





Indicate
      by check mark whether the registrant (1) has filed all reports required to
      be
      filed by Section 13 or 15(d) of the Exchange Act during the preceding twelve
      (12) months (or for such shorter period that the registrant was required to
      file
      such reports), and (2) has been subject to such filing requirements for the
      past
      ninety (90) days.





Yes x No  ̈





Indicate
      by check mark if disclosure of delinquent filers pursuant to Item 405 of
      Regulation S-B is not contained herein, and will not be contained, to the best
      of
      registrant's knowledge, in definitive proxy or information
      statements incorporated
      by reference in Part III of this Form 10-KSB or any amendment to this
      Form
      10-KSB. (X )





Indicate
      by check mark whether the registrant is a shell company (as defined in Rule
      12b-2 of the Exchange Act.





Yes  ̈ No x





The
      Company's revenues for its most recent fiscal year were $1,127,219.





The
      aggregate market value of the voting stock held by non-affiliates of the registrant
      as of April 10, 2008 was $197,694 based on a value of $0.0004 per share.





The
      number of shares of common stock, par value $0.001 per share, outstanding
      as of
      April
      10, 2008 were 494,236,058.





Transitional
      Small Business Disclosure Format (check one)  Yes  ̈  No x








**TURNAROUND
      PARTNERS, INC.**





**FORM
      10-KSB**





**FOR
      THE YEAR ENDED DECEMBER 31, 2007**





**INDEX**





PAGEPART
                IItem
                1. Description of Business
            4Item
                2. Description of Property
            7Item
                3. Legal Proceedings
            7Item
                4. Submission of Matters to a Vote of Security Holders
            7PART
                IIItem
                5. Market for Common Equity and Related Shareholder Matters
                Data
            8Item
                6. Management's Discussion and Analysis or Plan of
                Operation
            9Item
                7. Financial Statements
            17Item
                8. Changes in and Disagreements with Accountants on Accounting and
                Financial Disclosure
            17PART
                IIIItem
                9. Directors, Executive Officers, Promoters and Control Persons;
                Compliance with Section 16(a) of the Exchange Act
            18Item
                10. Executive Compensation
            19Item
                11. Security Ownership of Certain Beneficial Owners and Management
                and
                Related Shareholder Matters
            20Item
                12. Certain Relationships and Related Transactions
            22Item
                13. Exhibits
            22Item
                14. Principal Accountant Fees and Services
            25Signatures
            26





PART
      I


ITEM
      1.
      DESCRIPTION OF BUSINESS





Overview





In
      this
      Annual Report the words “Turnaround Partners” “Turnaround Partners, Inc.”,
“Turnaround”, the "Company", "we", "our" and "us" refer to Turnaround Partners,
      Inc., (formerly Emerge Capital Corp, formerly NuWave Technologies, Inc.
      (“NuWave”)) collectively with our consolidated subsidiaries, unless the context
      indicates otherwise. Our fiscal year ends on December 31st.





On
      August
      31, 2005, NuWave entered into a merger agreement (the "Agreement") with
      Corporate Strategies, Inc. ("Corporate Strategies") and the shareholders of
      Corporate Strategies ("Shareholders"). The Company was subsequently renamed
      Turnaround Partners, Inc. The transaction was accounted for as a reverse
      acquisition since control of the merged group passed to the shareholders of
      the
      acquired company (Corporate Strategies).





Pursuant
      to the terms of the Agreement, the Company issued one (1) share of its common
      stock ("Common Stock"), par value $0.001 per share, to each holder of Corporate
      Strategies Class A common stock in exchange for two (2) shares of Corporate
      Strategies Class A common stock, par value $0.001 per share. Second, the Company
      issued one (1) share of the Company's Series C preferred stock ("Series C
      Preferred"), par value $0.01 per share, to each holder of Corporate Strategies
      Series A preferred stock for one (1) share of Corporate Strategies Series A
      preferred stock, par value $0.001 per share.





The
      Company issued and delivered shares of its Series B convertible Preferred stock
      ("Series B Preferred") to each holder of Corporate Strategies Class B common
      stock so that effectively upon conversion of the Series B Preferred into common
      shares, the common shares issued upon conversion shall be equal to ninety-five
      percent (95%) of the issued and outstanding stock of the Company (calculated
      on
      a fully diluted basis as of the date of the Merger, following the issuance
      of
      all the Merger Consideration (as such term is defined in the Agreement) and
      after giving effect to such conversion, but not including any shares of Common
      Stock issuable upon conversion of any then outstanding Company convertible
      debentures. Therefore, the Merger Consideration for the Common Stock, Series
      C
      Preferred and Series B Preferred was the Corporate Strategies Class A common,
      Series A preferred and Class B common, respectively. The number of shares issued
      to the Shareholders in connection with the Merger was based upon a determination
      by the Company's Board of Directors (the "Board").





The
      terms
      of the Series B Preferred were subsequently modified. In connection with the
      Kipling purchase, 93,334 shares of Series B Preferred were exchanged for a
      like
      number of Series D Preferred, which were subsequently reduced to 700 shares
      of
      Series D Preferred. The remaining 6,666 shares of Series B Preferred are
      convertible into 4,195,445 shares of common stock. Each
      share of the Series D may be convertible, at the option of the holder, at any
      time and from time to time after December 31, 2006 through June 30, 2009, into
      that number of shares of Common Stock equal to the greater of (a) one tenth
      of
      one percent (0.1%) of the total number of shares of Common Stock issued and
      outstanding as of the last day of the fiscal quarter immediately preceding
      such
      date of conversion, calculated on a fully diluted basis after giving effect
      to
      the conversion of such share(s) of Series D and (b) One Hundred Thousand
      (100,000) shares of Common Stock. Each share of Series D Preferred Stock held
      by
      the Holders which has not been converted on or before June 30, 2009 into shares
      of Common Stock shall be convertible, at the option of the Holder of such share,
      at any time and from time to time after June 30, 2009 into one tenth of one
      percent (0.1%) of the total number of shares of Common Stock issued and
      outstanding on June 30, 2009, calculated on a fully diluted basis after giving
      effect to the conversion of such share(s) of Series D Preferred Stock. The
      shares of Common Stock received upon conversion shall be fully paid and
      non-assessable shares of Common Stock. Due
      to
      the change in control of the Company, Mr. Connolly and his spouse may not
      convert debentures that would result in ownership of more than 4.99% of the
      Company at the time of conversion.





The
      Series B and D Convertible Preferred Stockholders and the holders of the common
      stock vote together and the Preferred Stock shall be counted on an "as
      converted" basis, thereby giving the Preferred Shareholders control of the
      Company.





In
      November 2006, we migrated from a Delaware corporation to a Nevada corporation
      and changed the name of the Company to Turnaround Partners, Inc.





On
      May
      31, 2006, we filed an S-8 with the Securities and Exchange Commission for the
      Emerge Capital Corp. 2005 Stock Incentive Plan (the “Plan”). The document was
      submitted to register 10,000,000 shares of common stock. The purpose of the
      Plan
      is to promote the long-term growth and profitability of the Company by (a)
      providing key people with incentives to improve shareholder value and to
      contribute to the growth and financial success of the Company, and (b)
      enabling the Company to attract, retain and reward the best-available persons.
      This document is herein incorporated by reference. As of December 31, 2007
      there
      were 7,250,000 shares available under the Plan.


4


On
      September 30, 2006, we completed a stock purchase agreement (the “Agreement”)
      with Kipling Holdings, Inc. (“Kipling”) and Timothy J. Connolly, to acquire 100%
      of the total issued and outstanding capital stock of Kipling, a Delaware
      corporation. Kipling holds a limited partnership interest in a hotel in West
      Palm Beach, Florida.





On
      December 5, 2007 (the “ Closing
      Date ”),
      the
      Company filed on Form 8-K Current Report, as amended on December 14, 2007 and
      February 20, 2008, disclosing that the Company entered into a Stock Purchase
      Agreement (the “ Purchase
      Agreement ”)
      with
      Mr. Timothy J. Connolly, an individual, and Viewpoint Capital, LLC, a Nevada
      limited liability company (the “ Investor ”)
      pursuant to which the Company issued to the Investor one (1) share of the
      Company’s Series E convertible preferred stock, par value $0.01 per share
      (“ Series
      E Preferred ”),
      which
      such Series E Preferred is convertible into Three Hundred Million Shares
      (300,000,000) of common stock of the Company, par value $0.001 per share
      (“ Common
      Stock ”)
      in
      exchange for the transfer by the Investor to the Company of Four Million
      (4,000,000) unrestricted, free-trading shares of common stock of Asset Capital
      Group, Inc., a Nevada corporation (“ ACGU
      Common Stock ”)
      having
      a value of Three Million Four Hundred Thousand Dollars ($3,400,000) based on
      the
      closing price of ACGU Common Stock as of the Closing Date as reported on the
      Pink Sheets, LLC. ACGU Common Stock trades under the symbol “ACGU.PK”. As a
      result of this transaction, the Investor acquired a 63.66% controlling interest
      in the Company’s Common Stock by virtue of the Investor’s ownership of the
      Series E Preferred.





On
      February 13, 2008, the Investor delivered to the Company a notice to convert
      the
      one (1) shares of Series E Preferred to Three Hundred Million (300,000,000)
      shares of Common Stock. On February 14, 2008, the Company issued to the Investor
      Three Hundred Million (300,000,000) shares of Common Stock, all of which are
      restricted, and canceled the One (1) share of Series E Preferred. As a result
      of
      this transaction, the Investor acquired a 63.66% controlling interest in the
      Common Stock of the Company.





During
      the month of March 2008, we sold our investment in stock of ACGU for
      approximately $7,700. Consequently, our investment in marketable securities
      as
      of December 2007 includes the net realizable value of these securities sold
      in
      March 2008.





Effective
      as of the Closing Date, Mr. Connolly resigned as Vice Chairman of the Board
      and
      as President and Chief Executive Officer of the Company, however Mr. Connolly
      shall continue to serve as President and Chief Executive Officer of Corporate
      Strategies, Inc., a Texas corporation and wholly-owned subsidiary of the Company
      (“ CSI ”)
      with
      the understanding that the business of CSI will be discontinued or spun off
      to
      its stockholders. In addition, Mr. Connolly shall continue to receive the same
      compensation as he has received through the Closing Date for his aforementioned
      continued services to CSI through December 31, 2008, which such date may be
      extended by mutual agreement by and among the parties to the Purchase Agreement.





Furthermore,
      Mr. Connolly (and his spouse) agreed on the Closing Date to relinquish certain
      non-dilutive rights in favor of Mr. Connolly (and his spouse) contained in
      Seven
      Hundred (700) shares of Series D convertible preferred stock held by Mr.
      Connolly (and his spouse) effective June 30, 2009 (instead of the previous
      date
      of December 31, 2010) in exchange for the Company conveying all rights to the
      names “Turnaround Partners, Inc.”, “Corporate Strategies, Inc.” and “Kipling
      Holdings, Inc.”, as well as all title to all furniture and equipment in the
      Houston office of the Company. The parties to the Purchase Agreement also agreed
      that the names of these companies shall be changed within sixty (60) days
      following the Closing Date.





In
      connection with the Purchase Agreement, Mr. Russell Kidder was appointed to
      serve as President, Chief Executive Officer and as a Director of the Company
      effective as of the Closing Date.




As
      disclosed in the Form 8-K Current Report referred to above, the Company
      disclosed that effective as of December 27, 2007, the Board of Directors of
      the
      Registrant (the “ Board ”)
      accepted the resignation of (a) Wm. Chris Mathers from his position as Chief
      Financial Officer of the Registrant and (b) Fred Zeidman from his position
      as a
      member of the Board. Mr. Russell Kidder, the Registrant’s current President,
      Chief Executive Officer and member of the Board, shall serve as interim Chief
      Financial Officer, effective as of December 27, 2007.





As
      filed
      on Form 8-K Current Report on January 3, 2008, the Company disclosed that
      effective as of December 31, 2007, Corporate Strategies, Inc. (“ CSI ”),
      a
      Texas corporation and wholly-owned subsidiary of Turnaround Partners, Inc.,
      a
      Nevada corporation (the “ Registrant ”)
      entered into a Purchase Agreement (the “ Agreement ”)
      with
      Natural Nutrition, Inc., a Nevada corporation (“ NN ”)
      and
      CSI Business Finance, Inc., a Texas corporation and wholly-owned subsidiary
      of
      NN (together with NN, the “ Buyer ”)
      pursuant to which CSI conveyed, transferred and assigned to the Buyer all of
      its
      title to and rights in CSI’s ten percent (10%) interest in the total issued and
      outstanding capital stock of Interactive Nutrition International, Inc., a
      company organized under the laws of Canada (“ INII ”)
      in
      exchange for the conveyance, transfer and assignment to CSI by the Buyer of
      certain Notes held by the Buyer (as such term is defined in the Agreement)
      plus
      a cash payment equal to One Hundred Ninety-Eight Thousand Eight Hundred
      Ninety-Nine Dollars and Ten Cents ($198,899.10). In addition, NN assumed payment
      for all of CSI’s office lease, equipment payments and any other payments related
      to the office space at 109 N. Post Oak Lane, Suite 422, Houston, Texas 77024
      for
      the remainder of the lease term and any renewals.


5


Operations





Principal
      services and our market





The
      discussion below regarding our principal services and market assumes the Company
      will continue with its current business plan, however, in
      light
      of the Company’s change in control of ownership, the Company is contemplating a
      new business model. Currently, the Company believes the new business plan going
      forward will be to focus on alternative and clean technologies.





The
      Company is an established provider of restructuring strategies, turnaround
      execution and business development services for emerging and re-emerging public
      companies. The Company markets its services to public companies, hedge funds,
      institutional investors and banks that have significant exposure in troubled
      micro-cap public companies. These companies are typically either in operational
      or financial difficulty and may be in default of lending or equity agreements,
      and as a result, they may be facing bankruptcy or liquidation if their
      operations are not turned around. Under
      our
      consulting agreements, we do not take positions in securities of our clients
      that at any one time would cause us to have an ownership interest in them of
      over 4.99%.





The
      Company is generally compensated with a combination of cash payments on a
      monthly or quarterly basis, and outright grants of equity in the form of common
      stock and/or warrants for purchasing common stock. We believe this compensation
      plan aligns our interests with the client company's shareholders because our
      ultimate compensation is maximized by successfully increasing shareholder value.
      This performance based compensation arrangement clearly demonstrates that our
      interests are consistent with both our clients and their
      shareholders.





The
      Company minimizes risk from our restructuring/turnaround clients by implementing
      the following policies:





·
            The
                Company will not assume the financial obligations of the client company
                in
                any circumstance. In most cases, the financial institution with the
                greatest risk has referred the Company to the
                transaction.





·
            The
                Company requires the client or their investor to provide the client
                company with working capital necessary to execute the turnaround
                plan.





·
            The
                Company requires the client to fully indemnify the Company against
                any
                actions, with the exception of gross negligence or
                malfeasance.





·
            If
                the client has officer and director insurance, we require the client
                to
                add the Company or any of the Company's contractors as insured parties
                under the policy.





·
            Should
                the Company consider altering any of the policies above, it will
                require a
                vote of our Board of Directors to waive them and agree to the maximum
                amount of risk that the Company will
                assume.





The
      Company also actively trades securities and options with available cash. Many
      of
      these transactions contain a considerable amount of risk.





Lehigh
      Acquisition Corp. ("Lehigh") was a subsidiary of NuWave and was acquired August
      31, 2005, the date of the merger. Lehigh was sold on February 3, 2006. These
      financial statements include the operations of Lehigh through February 3, 2006
      as discontinued operations.





Competition
      for our services





Competition
      for the services we provide comes mainly from turnaround management and
      restructuring firms, financial advisory firms, business consulting firms and
      crisis management groups, many of which have substantially more capital
      resources than the Company.





To
      date,
      a significant portion of our business and financing has come from an
      institutional fund (YA Global Investments, LP (“YA Global”), (formerly Cornell
      Capital Partners, LP) that invests primarily in micro-cap
      companies.





Employees





As
      of
      April 10, 2008, the Company has 1 part time employee and employs the services
      of
      2 others on a contract basis. The controller and data entry clerk are considered
      contract employees whom also work as contract employees for a company sharing
      an
      office suite with Turnaround Partners, Inc.


6


ITEM
      2.
      DESCRIPTION OF PROPERTY





We
      maintain our headquarters in Houston, Texas in a 2,644 square foot office space
      shared with our then affiliated company, Natural Nutrition, Inc. We believe
      that
      the property is adequate and suitable for our current needs.





At
      the
      time of the August 2005 merger, the Company, through its wholly owned subsidiary
      WH Acquisition Corp (“WH”), acquired a residential property consisting of land
      and a residential building in Jersey City, New Jersey for a total purchase
      price
      of $122,000. The purchase price was paid with $113,000 in cash and $9,000 in
      the
      form of a deposit. The property was sold in December, 2005 for $165,000 and
      the
      Company took a mortgage note in the amount of $148,500 due December 1, 2006,
      which was extended to May 1, 2007, secured by a mortgage on the property. The
      debtor has subsequently filed for bankruptcy protection. The property is in
      danger of condemnation and we may abandon our claim with the bankruptcy court
      as
      we have reserved our entire investment in this property. This note receivable
      has been fully reserved.





ITEM
      3.
      LEGAL PROCEEDINGS





None.





ITEM
      4.
      SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS





None.


7


PART
      II




ITEM
      5.
      MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED SHAREHOLDER
      MATTERS





Market
      Information





Turnaround
      Partners, Inc.’s, common stock, par value $0.001 per share, is traded on the
      Over-the-Counter Bulletin Board (OTCBB) Market under the symbol TRNP.OB. The
      OTCBB is a regulated quotation service that displays real-time quotes, last-sale
      prices and volume information in over-the-counter equity securities. The
      following table sets forth the range of high and low closing bid prices for
      our
      common stock as reported on the OTCBB during each of the quarters presented.
      The
      quotations set forth below are inter-dealer quotations, without retail mark-ups,
      mark-downs or commissions and do not necessarily represent actual
      transactions.





Bid Price Per ShareHigh
            
            LowThree
                months ended March 31, 2006
            
            $
            0.170
            
            $
            0.060Three
                months ended June 30, 2006
            
            
            0.100
            
            
            0.072Three
                months ended September 30, 2006
            
            
            0.080
            
            
            0.051Three
                months ended December 31, 2006
            
            
            0.060
            
            
            0.010Three
                months ended March 31, 2007
            
            $
            0.070
            
            $
            0.009Three
                months ended June 30, 2007
            
            
            0.020
            
            
            0.003Three
                months ended September 30, 2007
            
            
            0.008
            
            
            0.001Three
                months ended December 31, 2007
            
            
            0.006
            
            
            0.001





As
      of
      December 31, 2007, there were approximately 220 holders of record of the
      Company's common stock. This number does not include beneficial owners of the
      common stock whose shares are held in the names of various dealers, clearing
      agencies, banks, brokers and other fiduciaries.





The
      Company has never declared or paid any cash dividends on its common shares.





The
      Company currently intends to retain any future earnings to finance the growth
      and development of its business and future operations, and therefore does not
      anticipate paying any cash dividends in the foreseeable future.





Securities
      Authorized for Issuance under Equity Compensation Plans:





On
      December 13, 2005, we established the Turnaround Partners, Inc. 2005 Stock
      Incentive Plan (the "Plan"). The Plan was adopted and approved by our
      shareholders. On a calendar year basis, an amount of shares of Common Stock
      equivalent to fifteen percent (15%) of the fully diluted shares outstanding
      on
      January 2 of any such calendar year (without taking into account outstanding
      Awards as defined in the Plan at the end of the prior calendar year) may be
      allocated, at the discretion of the Administrator, to be granted as Awards
      under
      the Plan, less Awards outstanding at the end of the prior calendar year. In
      no
      event shall the number of shares which may be allocated as Awards under the
      Plan
      be more than Ten Million (10,000,000) shares of Common Stock for a given
      calendar year. At present, there are no outstanding options. The following
      table
      below sets forth the securities available for issuance under the
      Plan:


8


Equity
      Compensation Plan Information





Plan
                category
            
            Number of securities to be
            
            Weighted-average exercise
            
            Number or securitiesissued upon exercise of
            
            price of outstanding options,
            
            remaining available foroutstanding options, warrants
            
            warrants and rights
            
            future issuance underand rights
            
            
            
            equity compensation plans(excluding securitiesreflected in column (a))(a)
            
            (b)
            
            (c)Equity
                  compensation plans
                  approved bysecurity holders
            
            
            -
            
            
            -
            
            
            1,583,333Equity
                  compensationplans not approved by security
                  holders
            
            
            -
            
            
            -
            
            
            -





There
      were no sales of unregistered securities or purchases of equity securities
      by
      the small business issuer and affiliated purchasers.




ITEM
      6.
      MANAGEMENT'S DISCUSSION AND ANALYSIS (“MD&A”) OF FINANCIAL CONDITION AND
      RESULTS OF
      OPERATIONS





This
      Annual Report on Form 10-KSB, and the accompanying MD&A contains
      forward-looking statements.  Statements contained in this report about
      Turnaround Partners, Inc.'s future outlook, prospects, strategies and plans,
      and
      about industry conditions and demand for our financial services are
      forward-looking.  All statements that express belief, expectation,
      estimates or intentions, as well as those that are not statements of historical
      fact, are forward looking. The words "proposed," "anticipates," "anticipated,"
      "will," "would," "should," "estimates" and similar expressions are intended
      to
      identify forward-looking statements.  Forward-looking statements represent
      our reasonable belief and are based on our current expectations and assumptions
      with respect to future events. While we believe our expectations and assumptions
      are reasonable, they involve risks and uncertainties beyond our control that
      could cause the actual results or outcome to differ materially from the expected
      results or outcome reflected in our forward-looking statements.  In light
      of these risks, uncertainties and assumptions, the forward-looking events
      discussed in this annual report may not occur. Such
      risks and uncertainties include, without limitation, our continuing success
      in
      securing consulting agreements, conditions in the capital and equity markets
      that provide opportunities for our restructuring and turnaround services, our
      success in trading marketable securities, our ability to maintain contracts
      that
      are critical to our operations, actual customer demand for our financing and
      related services, collection of accounts and notes receivable and our ability
      to
      obtain and maintain normal terms with our vendors and service providers during
      the periods covered by the forward-looking statements.





The
      forward-looking statements contained in this report speak only as of the date
      hereof.  We undertake no obligation to publicly update or revise any
      forward-looking statements, whether as a result of new information, future
      events or any other reason.  All forward-looking statements attributable to
      Turnaround Partners, Inc. or any person acting on its behalf are expressly
      qualified in their entirety by the cautionary statements contained or referred
      to in this Annual Report filed on Form 10-KSB and in our future periodic reports
      filed with the SEC. The following MD&A should be read in conjunction with
      these audited Consolidated Financial Statements of the Company, and the related
      notes thereto included elsewhere herein.





Overview





The
      discussion below regarding our results of operations, liquidity and capital
      resources are for the business of providing restructuring and turnaround
      services. In light of the Company’s change in control of ownership, the Company
      is contemplating a new business model. Currently, the Company believes that
      the
      new business plan going forward will be to focus on alternative and clean
      technologies.





Through
      December 31, 2007, we had primarily provided business restructuring, turnaround
      execution and business development advisory services for emerging and
      re-emerging public and private companies. The Company also actively trades
      securities and options with available cash. Many of these transactions contain
      a
      considerable amount of risk. Under our consulting agreements, we did not take
      positions in securities of our clients that at any one time would cause us
      to
      have an ownership interest in them of over 4.99%.


9


In
      August
      of 2005, Corporate Strategies, Inc. entered into a share exchange agreement
      whereby it exchanged all of the common stock of its subsidiary, CSI Business
      Finance, for 100,000 restricted shares of Series A Convertible Preferred stock
      of Health Express USA Inc. (HEXS.OB) - subsequently named Natural Nutrition,
      Inc. (NNTN.OB). The preferred stock shares acquired in this transaction were
      distributed to the shareholders of Corporate Strategies in the form of a
      dividend.





On
      August
      31, 2005, NuWave Technologies, Inc. ( "NuWave" or "the Company") entered into
      a
      merger agreement (the "Agreement") with Corporate Strategies, Inc. ("Corporate
      Strategies") and the shareholders of Corporate Strategies ("Shareholders").
      The Company was subsequently renamed Turnaround Partners, Inc. The transaction
      was accounted for as a reverse acquisition since control of the merged group
      passed to the shareholders of the acquired company (Corporate
      Strategies).





Pursuant
      to the terms of the Agreement, the Company issued one (1) share of its common
      stock ("Common Stock"), par value $0.001 per share, to each holder of Corporate
      Strategies Class A common stock in exchange for two (2) shares of Corporate
      Strategies Class A common stock, par value $0.001 per share. Second, the Company
      issued one (1) share of the Company's Series C preferred stock ("Series C
      Preferred"), par value $0.01 per share, to each holder of Corporate Strategies
      Series A preferred stock for one (1) share of Corporate Strategies Series A
      preferred stock, par value $0.001 per share.





The
      Company issued and delivered shares of its Series B convertible Preferred stock
      ("Series B Preferred") to each holder of Corporate Strategies Class B common
      stock so that effectively upon conversion of the Series B Preferred into common
      shares, the common shares issued upon conversion shall be equal to ninety-five
      percent (95%) of the issued and outstanding stock of the Company (calculated
      on
      a fully diluted basis as of the date of the Merger, following the issuance
      of
      all the Merger Consideration (as such term is defined in the Agreement) and
      after giving effect to such conversion, but not including any shares of Common
      Stock issuable upon conversion of any then outstanding Company convertible
      debentures ). Therefore, the Merger Consideration for the Common
      Stock, Series C Preferred and Series B Preferred was the Corporate Strategies
      Class A common, Series A preferred and Class B common, respectively. The number
      of shares issued to the Shareholders in connection with the Merger was based
      upon a determination by the Company's Board of Directors (the
      "Board").





The
      terms
      of the Series B Preferred were subsequently modified. In connection with the
      Kipling purchase, 93,334 shares of Series B Preferred were exchanged for a
      like
      number of Series D Preferred, which were subsequently reduced to 700 shares
      of
      Series D Preferred. The remaining 6,666 shares of Series B Preferred are
      convertible into 4,195,445 shares of common stock. Each
      share of the Series D may be convertible, at the option of the holder, at any
      time and from time to time after December 31, 2006 through June 30, 2009, into
      that number of shares of Common Stock equal to the greater of (a) one tenth
      of
      one percent (0.1%) of the total number of shares of Common Stock issued and
      outstanding as of the last day of the fiscal quarter immediately preceding
      such
      date of conversion, calculated on a fully diluted basis after giving effect
      to
      the conversion of such share(s) of Series D and (b) One Hundred Thousand
      (100,000) shares of Common Stock. Each share of Series D Preferred Stock held
      by
      the Holders which has not been converted on or before June 30, 2009 into shares
      of Common Stock shall be convertible, at the option of the Holder of such share,
      at any time and from time to time after June 30, 2009 into one tenth of one
      percent (0.1%) of the total number of shares of Common Stock issued and
      outstanding on June 30, 2009, calculated on a fully diluted basis after giving
      effect to the conversion of such share(s) of Series D Preferred Stock. The
      shares of Common Stock received upon conversion shall be fully paid and
      non-assessable shares of Common Stock. Due to the change in control of the
      Company, Mr. Connolly and his spouse may not convert debentures that would
      result in ownership of more than 4.99% of the Company at the time of
      conversion.





The
      Series B and D Preferred shareholders and the holders of the common stock vote
      together and the Series B and D Preferred shall be counted on an "as converted"
      basis, thereby giving the Series B and D Preferred shareholders control of
      the
      Company. The transaction was accounted for as a reverse acquisition since
      control of the merged group passed to the shareholders of the acquired company
      (Corporate Strategies).





On
      October 27, 2006, we filed a Schedule 14C Information statement. This
      information statement was furnished to all holders of shares of common stock
      and
      Series B and D convertible preferred stock of record at the close of business
      on
      October 23, 2006. Within this statement, the corporate actions involved three
      proposals providing for the following:





1.
            To
                approve a change of name of the Company to Turnaround Partners,
                Inc;


2.
            To
                approve the migration of the Company from a Delaware corporation
                to a
                Nevada corporation; and


3.
            To
                approve an increase of the number of authorized shares of Common
                Stock of
                the Company from Nine Hundred Million (900,000,000) to Five Billion
                (5,000,000,000) shares.





Lehigh
      Acquisition Corp. ("Lehigh") was a subsidiary of NuWave and is treated as if
      it
      was acquired August 31, 2005, the date of the merger. Lehigh was sold on
      February 3, 2006. The financial statements include the operations of Lehigh
      through February 3, 2006 as discontinued operations.


10


On
      May
      31, 2006, we filed an S-8 with the Securities and Exchange Commission for the
      Turnaround Partners, Inc. 2005 Stock Incentive Plan (the “Plan”). The document
      was submitted to register 10,000,000 shares of common stock. The purpose of
      the
      Plan is to promote the long-term growth and profitability of the Company
      by (a) providing key people with incentives to improve shareholder value
      and to contribute to the growth and financial success of the Company,
      and (b) enabling the Company to attract, retain and reward the
      best-available persons. This document is herein incorporated by reference.





On
      June
      26, 2006, we filed an SB-2 with the Securities Exchange Commission. The
      prospectus related to the registration of (a) 1,860,000 shares of common stock
      of Turnaround Partners, Inc. that would have been offered for sale from time
      to
      time by YA Global, (b) 937,500 shares of common stock of Turnaround Partners,
      Inc. that would have been offered for sale from time to time by iVoice, Inc.
      and
      (c) 2,812,500 shares of common stock of Turnaround Partners, Inc. that would
      have been distributed by dividend by iVoice to all of the Class A common
      stockholders of iVoice. Turnaround Partners, Inc. was not selling any shares
      of
      common stock in this offering and therefore would not have received any proceeds
      from this offering. On August 31, 2006, we formally withdrew this registration
      statement pursuant to Rule 477(a) under the General Rules and Regulations under
      the Securities Act of 1933, as amended.





Pursuant
      to the purchase of our interest in Kipling effective September 25, 2006, the
      Board of Directors approved the designation of Series D convertible preferred
      stock (the “Series D”), par value of $0.01, to consist of up to One Hundred
      Thousand (100,000) shares. As a result of the Kipling purchase, on December
      31,
      2006, the Board of Directors reduced the 93,334 shares of then outstanding
      Series D owned by our CEO, Timothy J. Connolly, and his spouse to Seven Hundred
      (700) shares of Series D. The Series D ranks pari passu with the common stock
      of
      the Company on an “as converted” basis, and senior to the Company’s Series A, B
      and C preferred stock. The holders of the Series D are entitled to receive
      dividends or distributions on a pro rata basis when and if dividends are
      declared on our Common Stock, but with no liquidation preference. Each share
      of
      the Series D may be convertible, at the option of the holder, at any time and
      from time to time after December 31, 2006 through June 30, 2009, into that
      number of shares of Common Stock equal to the greater of (a) one tenth of one
      percent (0.1%) of the total number of shares of Common Stock issued and
      outstanding as of the last day of the fiscal quarter immediately preceding
      such
      date of conversion, calculated on a fully diluted basis after giving effect
      to
      the conversion of such share(s) of Series D and (b) One Hundred Thousand
      (100,000) shares of Common Stock. Each share of Series D Preferred Stock held
      by
      the Holders which has not been converted on or before June 30, 2009 into shares
      of Common Stock shall be convertible, at the option of the Holder of such share,
      at any time and from time to time after June 30, 2009 into one tenth of one
      percent (0.1%) of the total number of shares of Common Stock issued and
      outstanding on June 30, 2009, calculated on a fully diluted basis after giving
      effect to the conversion of such share(s) of Series D Preferred Stock. The
      shares of Common Stock received upon conversion shall be fully paid and
      non-assessable shares of Common Stock. Due to the change in control of the
      Company, Mr. Connolly and his spouse may not convert debentures that would
      result in ownership of more than 4.99% of the Company at the time of conversion.





On
      September 30, 2006, we completed a stock purchase agreement (the “Purchase
      Agreement”) to acquire 100% of the total issued and outstanding capital stock of
      Kipling Holdings, Inc., a Delaware corporation from Timothy J. Connolly in
      consideration of (a) our assumption of all of the liabilities of Kipling,
      subject to certain consents, (b) certain anti-dilution rights as set forth
      in
      the Purchase Agreement and (c) all legal and other costs and expenses incurred
      by Kipling in consideration with this Purchase Agreement. Mr. Connolly serves
      as
      CEO of Turnaround and therefore (i) Turnaround obtained a third party appraisal
      of the Company which valued the acquired asset at Two Million Two Hundred Fifty
      Thousand Dollars ($2,250,000) more than the liabilities assumed and (ii)
      Turnaround’s other (disinterested) Board member and CFO reviewed and approved
      this affiliate transaction. Mr. Connolly received no profit from this
      affiliated transaction. Mr. Connolly received no profit from this
      affiliated transaction. Because this transaction was between parties under
      common control, we recorded the $3,313,264 of consideration in excess of Mr.
      Connolly’s original cost basis as a deemed distribution to Mr. Connolly. The
      Purchase Agreement had been subject to the written consent of Highgate House
      Funds, Ltd. (“ Highgate ”)
      an
      affiliate of YA Global, which the Company and Highgate reduced to writing
      effective as of September 30, 2006. Kipling, at December 31, 2006, owned a
      thirty percent interest in a Hilton hotel, which commenced operations in
      February 2007, in West Palm Beach, Florida. Since the purchase was effective
      on
      September 30, 2006 the Company did not record any revenue or expenses during
      the
      nine months ended September 30, 2006.





In
      a
      separate agreement with an individual, the Company issued an additional
      2,000,000 shares and 3,000,000 warrants ($0.05 per warrant) in consideration
      of
      the individual’s surrender of his option, rights or other interests whatsoever
      to purchase any capital stock of Kipling Holdings, Inc. The Company has valued
      these 2,000,000 shares at $140,000. The Company used the closing price of $0.07
      per share on September 30, 2006, the date of contract execution, as the value
      assigned to these shares. This expense is included as merger expense for the
      twelve months ended December 31, 2006. The Company has valued the 3,000,000
      warrants in the amount of $141,000 using the Black Sholes method and is
      amortized over the term of the agreement.





On
      December 5, 2007 (the “ Closing
      Date ”),
      the
      Company filed on Form 8-K Current Report, as amended on December 14, 2007 and
      February 20, 2008, disclosing that the Company entered into a Stock Purchase
      Agreement (the “ Purchase
      Agreement ”)
      with
      Mr. Timothy J. Connolly, an individual, and Viewpoint Capital, LLC, a Nevada
      limited liability company (the “ Investor ”)
      pursuant to which the Company issued to the Investor one (1) share of the
      Company’s Series E convertible preferred stock, par value $0.01 per share
      (“ Series
      E Preferred ”),
      which
      such Series E Preferred is convertible into Three Hundred Million Shares
      (300,000,000) of common stock of the Company, par value $0.001 per share
      (“ Common
      Stock ”)
      in
      exchange for the transfer by the Investor to the Company of Four Million
      (4,000,000) unrestricted, free-trading shares of common stock of Asset Capital
      Group, Inc., a Nevada corporation (“ ACGU
      Common Stock ”)
      having
      a value of Three Million Four Hundred Thousand Dollars ($3,400,000) based on
      the
      closing price of ACGU Common Stock as of the Closing Date as reported on the
      Pink Sheets, LLC. ACGU Common Stock trades under the symbol “ACGU.PK”. As a
      result of this transaction, the Investor acquired a 63.66% controlling interest
      in the Company’s Common Stock by virtue of the Investor’s ownership of the
      Series E Preferred.


11


On
      February 13, 2008, the Investor delivered to the Company a notice to convert
      the
      one (1) shares of Series E Preferred to Three Hundred Million (300,000,000)
      shares of Common Stock. On February 14, 2008, the Company issued to the Investor
      Three Hundred Million (300,000,000) shares of Common Stock, all of which are
      restricted, and canceled the One (1) share of Series E Preferred. As a result
      of
      this transaction, the Investor acquired a 63.66% controlling interest in the
      Common Stock of the Company.





During
      the month of March 2008, we sold our investment in stock of ACGU for
      approximately $7,700. Consequently, our investment in marketable securities
      as
      of December 2007 includes the net realizable value of these securities sold
      in
      March 2008.





Effective
      as of the Closing Date, Mr. Connolly resigned as Vice Chairman of the Board
      and
      as President and Chief Executive Officer of the Company, however Mr. Connolly
      shall continue to serve as President and Chief Executive Officer of Corporate
      Strategies, Inc., a Texas corporation and wholly-owned subsidiary of the Company
      (“ CSI ”)
      with
      the understanding that the business of CSI will be discontinued or spun off
      to
      its stockholders. In addition, Mr. Connolly shall continue to receive the same
      compensation as he has received through the Closing Date for his aforementioned
      continued services to CSI through December 31, 2008, which such date may be
      extended by mutual agreement by and among the parties to the Purchase Agreement.





Furthermore,
      Mr. Connolly (and his spouse) agreed on the Closing Date to relinquish certain
      non-dilutive rights in favor of Mr. Connolly (and his spouse) contained in
      Seven
      Hundred (700) shares of Series D convertible preferred stock held by Mr.
      Connolly (and his spouse) effective June 30, 2009 (instead of the previous
      date
      of December 31, 2010) in exchange for the Company conveying all rights to the
      names “Turnaround Partners, Inc.”, “Corporate Strategies, Inc.” and “Kipling
      Holdings, Inc.”, as well as all title to all furniture and equipment in the
      Houston office of the Company. The parties to the Purchase Agreement also agreed
      that the names of these companies shall be changed within sixty (60) days
      following the Closing Date.





As
      disclosed in the Form 8-K Current Report referred to above, the Company
      disclosed that effective as of December 27, 2007, the Board of Directors of
      the
      Registrant (the “ Board ”)
      accepted the resignation of (a) Wm. Chris Mathers from his position as Chief
      Financial Officer of the Registrant and (b) Fred Zeidman from his position
      as a
      member of the Board. Mr. Russell Kidder, the Registrant’s current President,
      Chief Executive Officer and member of the Board, shall serve as interim Chief
      Financial Officer, effective as of December 27, 2007.





In
      connection with the Purchase Agreement, Mr. Russell Kidder was appointed to
      serve as President, Chief Executive Officer and as a Director of the Company
      effective as of the Closing Date.




As
      filed
      on Form 8-K Current Report on January 3, 2008, the Company disclosed that
      effective as of December 31, 2007, Corporate Strategies, Inc. (“ CSI ”),
      a
      Texas corporation and wholly-owned subsidiary of Turnaround Partners, Inc.,
      a
      Nevada corporation (the “ Registrant ”)
      entered into a Purchase Agreement (the “ Agreement ”)
      with
      Natural Nutrition, Inc., a Nevada corporation (“ NN ”)
      and
      CSI Business Finance, Inc., a Texas corporation and wholly-owned subsidiary
      of
      NN (together with NN, the “ Buyer ”)
      pursuant to which CSI conveyed, transferred and assigned to the Buyer all of
      its
      title to and rights in CSI’s ten percent (10%) interest in the total issued and
      outstanding capital stock of Interactive Nutrition International, Inc., a
      company organized under the laws of Canada (“ INII ”)
      in
      exchange for the conveyance, transfer and assignment to CSI by the Buyer of
      certain Notes held by the Buyer (as such term is defined in the Agreement)
      plus
      a cash payment equal to One Hundred Ninety-Eight Thousand Eight Hundred
      Ninety-Nine Dollars and Ten Cents ($198,899.10). In addition, NN assumed payment
      for all of CSI’s office lease, equipment payments and any other payments related
      to the office space at 109 N. Post Oak Lane, Suite 422, Houston, Texas 77024
      for
      the remainder of the lease term and any renewals.





Results
      of continuing operations for the year ended December 31, 2007 (the “2007
      Period”) as compared with December 31, 2006 (the “2006 Period”).





Revenues





Total
      revenue for the 2007 Period decreased by approximately $19,800 as compared
      to
      the 2006 Period.





Discount
      income was approximately $10,425 in the 2006 Period as compared with zero
      discount income for the 2007 Period. Management does not anticipate generating
      any significant new business in this area.


12


Consulting
      revenue increased by approximately $392,883 to $1,356,160 in the 2007 Period.
      Consulting revenues are generally one-time fees related to specific events,
      or
      contracts covering services to be rendered over a period of time. The Company
      enters into contracts to provide strategic consulting services, including
      general business development, mergers, acquisitions, management advisory, and
      restructuring services. There was one such contracts at December 31, 2007.
      The
      contract fee was prepaid in stock of the client company. The deferred revenue
      is
      being recognized through the period ending January 2008 at an amount of
      approximately $9,100 per month. In the past our contracts generally called
      for a
      base payment equal to approximately $6,000 - $12,000 per month, which may be
      payable in stock, with additional fees for consulting services beyond a preset
      amount. Some contracts include warrants or success fees. Because of the possible
      change in our fundamental business model, no new contracts have been procured
      at
      the time of this filing, and it is possible that no new contracts will be sought
      in the future.





We
      recorded overall losses in marketable securities in the 2007 Period of
      approximately $303,373 versus a loss of approximately $51,093 for the 2006
      Period. The Company accepts both compensation for its services and invests
      in
      micro cap marketable securities. Most of these securities are in companies
      defined as penny stocks and are volatile, trading substantially up or down
      in
      any given quarter. Realized gains and (losses) for the 2007 and 2006 Periods
      were ($278,020) versus $107,716, respectively, and unrealized gains and (losses)
      for the 2007 and 2006 Periods of ($25,353) versus ($158,809),
      respectively.





Fee
      income represents brokerage fees of approximately $54,650 received or accrued
      in
      2007 on loans we referred to a then affiliated company, CSI Business Finance
      Inc. Fees for the 2007 Period and the 2006 Period totaled $54,650 and $204,610,
      respectively. Management does not anticipate generating any significant new
      business in this area.





General
      and Administrative Expenses





General
      and administrative expenses decreased by approximately $216,000 to $2,045,663
      for the 2007 Period as compared to $2,261,933 for the 2006 Period. For the
      twelve months ended December 31, 2007, general and administrative expenses
      were
      primarily comprised of salaries and benefits ($831,214), professional fees
      ($479,161) and bad debts in the amount of $524,414, primarily as a result of
      a
      mortgage note in the amount of $148,500 due to the Company from an individual
      who declared bankruptcy, a loan in the amount of $100,000 to a company in
      Vermont that is deemed uncollectible and a loan to another microcap company
      that
      is deemed uncollectible in the amount of $200,000. The remaining general and
      administrative expenses were comprised of business development, rent,
      advertising and other ordinary expenses necessary for our operations. For the
      twelve months ended December 31, 2006, general and administrative expenses
      were
      $2,261,933 and consisted primarily of salaries and benefits ($892,286),
      professional fees ($855,722) and bad debts in the amount of $243,302. The
      remaining general and administrative expenses were comprised of business
      development, rent, advertising and other ordinary expenses necessary for our
      operations. Our company shared office space and certain administrative functions
      and staff with an affiliated company to whom we allocate costs for these shared
      functions based on an estimate of time usage. We have not reached the size
      to
      benefit from separate office space and a full time staff. Beginning in 2008,
      the
      leased premises were assumed by the then affiliated company, Natural Nutrition,
      Inc.





Salaries
      and benefits decreased by approximately $61,000 to $831,214 in the 2007 Period
      as compared to the 2006 Period, primarily as a result of our acquisition
      specialist leaving our employment in May 2007.





Professional
      fees were approximately $479,161 for the twelve months ended December 31, 2007,
      a decrease of approximately $376,000 as compared to the 2006 Period. The
      decrease was primarily a result of acquisition due diligence fees incurred
      in
      the 2006 Period not similarly incurred in the 2007 Period. The remainder of
      the
      professional fees for the 2007 Period represents accounting, legal and
      consulting fees relating to regulatory requirements of being a public
      company.





We
      allocated overhead to a then affiliated company for items such as rent, payroll
      and other general operating expenses. For the 2007 Period we allocated
      approximately $244,000 versus $308,000 for the 2006 Period. There are no such
      allocations beginning in 2008.





Other
      income and expense





We
      recorded derivative income of $141,664 for the 2007 Period and $3,642,080 for
      the 2006 Period. These amounts represent the change in the fair value of the
      net
      derivative liability.





In
      connection with the acquisition of Kipling Holdings, Inc on September 30, 2006,
      we paid $140,000 under a services contract to an individual. This expense has
      been classified as a merger expense in the results of operations for the twelve
      months ended December 31, 2006.





Certain
      convertible debt was considered extinguished in the first quarter 2006 because
      of the sale of Lehigh. The extinguishment income was $130,563 for the twelve
      months ended December 31, 2006.





During
      the first quarter of 2007, certain individuals converted their debentures into
      our common stock. As a result, we recorded a gain on debt extinguishment in
      the
      amount of $450,650 for the 2007 Period.


13


Interest
      expense increased by approximately $547,207 for the 2007 Period as compared
      to
      the 2006 Period. The increase is primarily a result of the amortization of
      discounts related to derivatives on our convertible debentures and interest
      expense incurred on our investment in Kipling.





For
      the
      2007 Period, we recorded an operating loss and impairment on our investment
      in
      the West Palm Beach hotel within Kipling Holdings, Inc. in the amount of
      $685,136. Included in this amount is $540,000 for impairment of long-lived
      asset. During the fourth quarter of 2007 there was a proposed sale of the hotel
      that would have resulted in a loss to the Company of approximately $540,000.
      The
      sale of the hotel did not occur, but the asset was written down to estimated
      net
      realizable value nevertheless. The business segment affected is our “Hotel
      Investment” as found in Footnote 19 of the consolidated financial
      statements.





Discontinued
      Operations





During
      February 2006, the Company sold the shares of its wholly-owned subsidiary
      Lehigh. This resulted in a loss from discontinued operations for the 2006 in
      the
      amount of $4,688, net of applicable income tax.





Gain
      on
      sale of subsidiary of $3,042,406 represents the gain on the sale of Lehigh
      in
      February 2006.





During
      August 2005, Corporate Strategies distributed the shares of its business finance
      subsidiary (CSI Business Finance, Inc.) to its shareholders. On December 31,
      2005, the Company sold its mortgage brokerage subsidiary for a convertible
      debenture. Based on a


review
      for collectibility at the transaction date, it was determined that
      collectibility was improbable and, accordingly no proceeds were recognized
      from
      the sale. Since the mortgage brokerage subsidiary had negative equity at the
      sale date, the Company recognized a profit to the extent of net liabilities
      assumed by the purchaser. In
      December 2006, we received $275,000 in full satisfaction of the convertible
      debenture which was recorded as a gain on sale of subsidiary at December 31,
      2006.





LIQUIDITY
      AND CAPITAL RESOURCES





Operating
      activities





We
      recorded a net loss for the twelve months ended December 31, 2007 in the amount
      of $2,604,975 versus net income in the amount of $4,936,074 for the twelve
      months ended December 31, 2006. Our net income for the twelve months ended
      December 31, 2006 was primarily a result of the gain on sale of Lehigh and
      our
      net change in fair value of derivative liability. Net cash used in operating
      activities was $1,598,439 for the twelve months ended December 31, 2007. We
      expensed $524,414 in bad debts primarily as a result of a mortgage note in
      the
      amount of $148,500 due to the Company from an individual who declared
      bankruptcy, a loan in the amount of $100,000 to a company in Vermont that was
      deemed uncollectible and a loan to another microcap company that is deemed
      uncollectible in the amount of $200,000. We recorded interest expense and net
      change in derivative liability in the amount of $692,908. In the fourth quarter
      of 2007 we recorded an operating loss and impairment in our investment in the
      West Palm Beach hotel (Kipling) in the amount of $685,136. We recorded income
      in
      the amount of $889,804 as a non-cash merger expense for the sale of our 10%
      interest in Natural Nutrition, Inc., a then affiliated company. Certain
      debentures were converted that resulted in a gain on debt modification in the
      amount of $450,250.





At
      December 31, 2007, the Company had a working capital deficit of approximately
      $2,174,851. Our working capital deficit includes a computed liability for the
      fair value of derivatives of $282,181, which will only be realized on the
      conversion of the derivatives, or settlement of the debentures. Our convertible
      debenture liability in the amount of $1,932,475 is classified as a current
      liability however it is our option to force conversion of these convertible
      debentures into the Company's common stock at any time.





Under
      our
      consulting agreements, we do not take positions in securities of our clients
      that at any one time would cause us to have an ownership interest in them of
      over 4.99%. Because of this restriction, we could be hindered in our ability
      to
      generate necessary cash for our operations.





Investing
      activities





We
      received preferential returns and distributions of capital from our investment
      in the West Palm Beach hotel in the amount of $481,250. We also received net
      proceeds from disposition of an investment in the amount of
      $198,899





As
      of
      December 31, 2007, $500,000 of our short-term investments was invested in
      auction rate securities, or ARSs. The $500,000 we have invested in ARSs at
      April
      28, 2008 is collateralized by portfolios of AAA municipal obligations.
 Through the date of this filing, auctions of these securities were not
      successful, resulting in our continuing to hold these securities and the issuers
      paying interest at the maximum contractual rate. Based on current market
      conditions, it is likely that auctions related to these securities will be
      unsuccessful in the near term. Unsuccessful auctions will result in our
      holding securities beyond their next scheduled auction reset dates and limiting
      the short-term liquidity of these investments. While these failures in the
      auction process have affected our ability to access these funds in the near
      term, we do not believe that the underlying securities or collateral have been
      affected. We believe that the higher reset rates on failed auctions provide
      sufficient incentive for the security issuers to address this lack of liquidity.
      If the credit rating of the security issuers deteriorates, we may be
      required to adjust the carrying value of these investments through an impairment
      charge. Excluding ARSs, at April 28, 2008, we had approximately $231,877 in
      cash
      and short-term investments. We believe the working capital available to us
      will
      be sufficient to meet our cash requirements for at least the next
      12 months, however if the ARS’ are not converted into cash within the next
      12 months the Company could experience working capital
      difficulties.


14


Financing
      activities





For
      the
      twelve months ended December 31, 2007, we repaid approximately $84,233 on note
      payables.





We
      have
      225 shares of Series C preferred stock outstanding. The stock has a liquidation
      preference of $337,380 and is redeemable at $1,500 per share at the Company’s
      option. Dividends are cumulative and accrue at the rate of $120 per share per
      year. Under the purchase agreement dated December 5, 2007, the series C
      preferred stock was to have been paid off by December 31, 2007 therefore, the
      full liquidation value of $337,380 is recorded as a current
      liability.





Our
      cash
      flows for the periods are summarized below:





Year ended
            
            Year endedDecember 31, 2007
            
            December 31, 2006Net
                cash provided by (used in) operating activities
            
            $
            (1,490,657
            )
            $
            146,119Net
                cash provided by investing activities
            
            
            677,058
            
            
            599,635Net
                cash used in financing activities
            
            
            84,233
            
            
            68,812





Our
      cash
      decreased by $897,832 since December 31, 2006.





Management
      believes the Company has adequate working capital and cash to be provided from
      operating activities to fund current levels of operations. We anticipate that
      our company will grow. As our business grows we believe that we will have to
      raise additional capital in the private debt and/or public equity markets to
      fund our investments.





OFF-BALANCE
      SHEET ARRANGEMENTS





Until
      December 31, 2007, we leased our office space under an operating lease. Rental
      expense under operating leases for continuing operations aggregated $87,453
      and
      $76,395 for the years ended December 31, 2007 and 2006, respectively. Effective
      February 10, 2005, the Company entered into a new five year lease in a new
      building and moved the Company’s headquarters there. Beginning January 1, 2008,
      this leased has been assumed by our then affiliate company, Natural Nutrition,
      Inc.





RECENT
      ACCOUNTING PRONOUNCEMENTS





In
      June
      2006, the Financial Accounting Standards Board (“ FASB ”)
      issued
      FASB Interpretation No. 48, *“Accounting
      for Uncertainty in Income Taxes”* (“ FIN 48 ”) *.* FIN 48 clarifies the application of SFAS No. 109, *Accounting
      for Income Taxes* ,
      by
      establishing a threshold condition that a tax position must meet for any part
      of
      the benefit of that position to be recognized in the financial statements.
      In
      addition to recognition, FIN 48 provides guidance concerning measurement,
      derecognition, classification and disclosure of tax positions. FIN 48 is
      effective for fiscal years beginning after December 15, 2006; accordingly,
      the Company adopted FIN 48 effective as of January 1, 2007. The
      adoption of FIN 48 did not have a material impact on its effective tax
      rate.




In
      September 2006, the SEC staff issued Staff Accounting Bulletin (“ SAB ”)
      No. 108, *Considering
      the Effects of Prior Year Misstatements when Quantifying Misstatements in
      Current Year Financial Statements.* SAB 108
      provides guidance on how the effects of the carryover or reversal of prior
      year
      misstatements should be considered in quantifying a current year misstatement.
      SAB 108 established a dual approach that requires quantification of errors
      under two methods: (1) roll-over method which quantifies the amount by
      which the current year income statement is misstated, and (2) the iron
      curtain method which quantifies the error as the cumulative amount by which
      the
      current year balance sheet is misstated. In some situations, companies will
      be
      required to record errors that occurred in prior years even though those errors
      were immaterial for each year in which they arose. Companies may choose to
      either restate all previously presented financial statements or record the
      cumulative effect of such errors as an adjustment to retained earnings at the
      beginning of the period in which SAB 108 is applied. SAB 108 is
      effective for fiscal years ending after November 15, 2006. The adoption of
      this pronouncement did not have an impact on the Company’s financial position or
      results of operations.


15


In
      September 2006, the FASB issued SFAS No. 157, *Fair
      Value Measurements* (“ SFAS
      No. 157 ”).
      This
      statement defines fair value, establishes a framework for measuring fair value
      in generally accepted accounting principles, and expands disclosures about
      fair
      value measurements. This statement clarifies how to measure fair value as
      permitted under other accounting pronouncements but does not require any new
      fair value measurements. SFAS No. 157 was originally effective for financial
      statements issued for fiscal years beginning after November 15, 2007, and
      interim periods within those fiscal years. On February 12, 2008, the FASB issued
      Final FASB Staff Position (“ FSP ”)
      No.
      Financial Accounting Standard (“ FAS ”)
      157-2, *Effective
      Date of FASB Statement*  *No.
      157* (“ FSP
      No. 157-2 ”).
      FSP
      No. 157-2, which was effective upon issuance, delays the effective date of
      SFAS
      No. 157 for nonfinancial assets and nonfinancial liabilities, except for items
      that are recognized or disclosed at fair value at least once a year, to fiscal
      years beginning after November 15, 2008. The Company expects to adopt FAS No.
      157 on January 1, 2008 and 2009 for financial assets and financial liabilities
      and nonfinancial assets and nonfinancial liabilities, respectively. The Company
      does not believe that the adoption of FAS No. 157 will have a material effect
      on
      the Company’s consolidated financial statements.





In
      July
      2006, the FASB issued FIN 48, which clarifies the accounting for uncertainty
      in
      tax positions. This Interpretation requires that the Company recognize in our
      financial statements, the impact of a tax position, if that position is more
      likely than not of being sustained on audit, based on the technical merits
      of
      the position. The provisions of FIN 48 are effective as of the beginning of
      our
      2007 fiscal year, with the cumulative effect of the change in accounting
      principle recorded as an adjustment to opening retained earnings. The adoption
      of FIN 48 did not have a material effect on the Company’s financial condition or
      results of operations for the year ended December 31, 2007.




In
      February 2007, the FASB issued SFAS No. 159, *The
      Fair Value Option for Financial Assets and Liabilities Including an amendment
      of
FASB Statement No. 115* (“ SFAS
      No. 159 ”).
      SFAS
      No. 159 permits entities to choose to measure many financial instruments and
      certain other items at fair value that ** are
      not
      currently required to be measured at fair value. SFAS No. 159 also establishes
      presentation and disclosure requirements designed to facilitate ** comparisons
      between entities that choose different measurement attributes for similar types
      of assets and liabilities. SFAS No. 159 is effective as of the ** beginning
      of an entity’s first fiscal year that begins after November 15, 2007. The
      Company expects to adopt SFAS No. 159 on January 1, 2008. The Company has
      evaluated the impact of adopting SFAS No. 159 and has determined that it will
      not elect the fair value option under SFAS No.159 for any financial instruments
      that are not required to be presented at fair value under generally accepted
      accounting principles.





In
      December 2007, the FASB issued SFAS No. 160, “Noncontrolling Interests in
      Consolidated Financial Statements - an amendment of ARB No. 51” (“ SFAS
      160 ”).
      SFAS
      160 establishes new accounting and reporting standards for the noncontrolling
      interest in a subsidiary and for the deconsolidation of a subsidiary. Before
      this statement, limited guidance existed for reporting noncontrolling interests
      (minority interest). As a result, diversity in practice exists. In some cases
      minority interest is reported as a liability and in others it is reported in
      the
      mezzanine section between liabilities and equity. Specifically, SFAS 160
      requires the recognition of a noncontrolling interest (minority interest) as
      equity in the consolidated financials statements and separate from the parent’s
      equity. The amount of net income attributable to the noncontrolling interest
      will be included in consolidated net income on the face of the income statement.
      SFAS 160 clarifies that changes in a parent’s ownership interest in a subsidiary
      that do not result in deconsolidation are equity transactions if the parent
      retains its controlling financial interest. In addition, this statement requires
      that a parent recognize gain or loss in net income when a subsidiary is
      deconsolidated. Such gain or loss will be measured using the fair value of
      the
      noncontrolling equity investment on the deconsolidation date. SFAS 160 also
      includes expanded disclosure requirements regarding the interests of the parent
      and its noncontrolling interests. SFAS 160 is effective for the Company on
      January 1, 2009. Earlier adoption is prohibited. The Company is currently
      evaluating the impact, if any, of the adoption of SFAS 160 will have on its
      consolidated financial statements.





In
      December 2007, the FASB issued SFAS No. 141R, *Business
      Combinations* .
      SFAS
      No. 141R provides companies with principles and requirements on how an acquirer
      recognizes and measures in its financial statements the identifiable assets
      acquired, liabilities assumed, and any noncontrolling interest in the acquiree
      as well as the recognition and measurement of goodwill acquired in a business
      combination. SFAS No. 141R also requires certain disclosures to enable users
      of
      the financial statements to evaluate the nature and financial effects of the
      business combination. Acquisition costs associated with the business combination
      will generally be expensed as incurred. SFAS 141R is effective for business
      combinations occurring in fiscal years beginning after December 15, 2008. Early
      adoption of SFAS No. 141R is not permitted. The Company is currently evaluating
      the impact SFAS No. 141R will have on any future business
      combinations.





Critical
      Accounting Policies





DERIVATIVE
      FINANCIAL INSTRUMENTS





The
      derivatives issued from 2003 through 2006 have been accounted for in accordance
      with SFAS 133 and EITF No. 00-19, "Accounting for Derivative Financial
      Instruments Indexed to, and Potentially Settled in, a Company's Own
      Stock."





The
      Company has identified that these debentures have embedded derivatives. These
      embedded derivatives have been bifurcated from their respective host debt
      contracts and accounted for as derivative liabilities in accordance with EITF
      00-19. When multiple derivatives exist within the Convertible Notes, they have
      been bundled together as a single hybrid compound instrument in accordance
      with
      SFAS No. 133 Derivatives Implementation Group Implementation Issue No. B-15,
      "Embedded Derivatives: Separate Accounting for Multiple Derivative Features
      Embedded in a Single Hybrid Instrument".


16


The
      embedded derivatives within the Convertible Notes have been recorded at fair
      value at the date of issuance; and are marked-to-market each reporting period
      with changes in fair value recorded to the Company's income statement as "Net
      change in fair value of derivative liabilities". The Company has utilized a
      third party valuation firm to fair value the embedded derivatives using a
      layered discounted probability-weighted cash flow approach.





The
      fair
      value of the derivative liabilities are subject to the changes in the trading
      value of the Company's common stock, as well as other factors. As a result,
      the
      Company's financial statements may fluctuate from quarter-to-quarter based
      on
      factors, such as the price of the Company's stock at the balance sheet date
      and
      the amount of shares converted by note holders. Consequently, our


financial
      position and results of operations may vary from quarter-to-quarter based on
      conditions other than our operating revenues and expenses.





REVENUE
      RECOGNITION





The
      Company follows the guidance of the SEC's Staff Accounting Bulletin No. 104
      for
      revenue recognition. The Company records revenue when persuasive evidence of
      an
      arrangement exists, services have been rendered or product delivery has
      occurred, the sales price to the customer is fixed or determinable, and
      collectibility is reasonably assured.





ITEM
      7.
      FINANCIAL STATEMENTS





The
      Consolidated Financial Statements of Turnaround Partners, Inc. required by
      Item
      310(a)of Regulation S-B are attached to this Annual Report. Reference is made
      to
      Item 13 below for an Index to such Consolidated Financial
      Statements.





ITEM
      8.
      CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
      AND FINANCIAL
      DISCLOSURE





There
      have been no changes in accountants or disagreements on any matter of accounting
      principles or practices, financial statement disclosure, or auditing scope
      or
      procedures with the Company’s independent accountants during the two (2) fiscal
      years ended December 31, 2007.





ITEM
      8A(T). CONTROLS AND PROCEDURES





Because
      of its size, the Company shares its accounting staff with another company
      located in the same suite in Houston, Texas and is comprised of its controller
      and a data entry clerk. The controller and data entry clerk are considered
      contract employees whom also work for the other company within the office suite
      as contract employees. We currently do not have the resources to hire full-time
      accounting personnel and do not anticipate hiring any full-time accounting
      personnel in the near future.





As
      of the
      end of the period covered by this report, we have evaluated the effectiveness
      of
      the design and operation of our disclosure controls and procedures under the
      supervision and with the participation of our Chief Executive Officer
      ("CEO").





In
      connection with the audit of our Consolidated Financial Statements for the
      fiscal year ended December 31, 2007, our independent registered public
      accounting firm informed us that we had significant deficiencies constituting
      material weaknesses as defined by the standards of the Public Company Accounting
      Oversight Board, which had been identified in connection with the audit of
      our
      Consolidated Financial Statements for the fiscal years ended December 31, 2007
      and 2006.





The
      material weaknesses identified by the auditor during the December 31, 2006
      and
      2007 audit were the lack of segregation of duties necessary to maintain proper
      checks and balances between functions and the lack of procedures to properly
      account for non-routine transactions including the write down of stock
      investment, impairment of an investment in a partnership and recording of the
      additional liability at the liquidation value for a series of preferred stock
      which was to be completely liquidated at December 31, 2007.





The
      absence of qualified full time accounting personnel was a contributing factor
      to
      the problems identified by the auditor. The specific circumstances giving rise
      to the weaknesses include utilizing the services of contract accountants on
      a
      part time basis in the absence of internal accounting personnel.





Further,
      based on the material weaknesses described herein, we concluded that our
      disclosure controls and procedures were not effective at December 31, 2007.


17


PART
      III




ITEM
      9.
      DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS; COMPLIANCE WITH
      SECTION 16(A) OF THE EXCHANGE ACT





The
      Company is not aware of any legal proceedings in which any director, executive
      officer, affiliate or any owner of record or beneficial owner of more than
      five
      percent (5%) of any class of voting securities of the Company, or any associate
      of any such director, executive officer or affiliate of the Company or security
      holder is a party adverse to the Company or any of its subsidiaries or has
      a
      material interest adverse to the Company or any of its
      subsidiaries.





The
      following table sets forth the names and ages of the current director and
      executive officersof the Company and the positions held at the Company. The
      executive officer of the Company is elected annually by the Board of Directors
      (the "Board") . The Directors serve one (1) year terms until their successors
      are elected. The executive officers serve terms of one (1) year or until their
      death, resignation or removal by the Board.





Name
            
            Age
            
            Positions(S)Russell
                Kidder
            
            61
            
            Director,
                President, Chief Executive Officer Interim Chief Financial
                Officer





There
      are
      no family relationships among the director or executive officer of the Company.
      Except as provided herein, the Company's director or executive officer is not
      a
      director of any company that files reports with the SEC, except as discussed
      below. The Company's director has not been involved in any bankruptcy or
      criminal proceeding (excluding traffic and other minor offenses), and nor has
      he
      been enjoined from engaging in any business during the past five (5)
      years.





Set
      forth
      below is a brief description of the background and business experience of the
      Company's existing Director and executive officer for the past five (5)
      years:





***Russell
      Kidder.*** From
      1989 to present, Mr. Kidder has served as a consultant to a number of small
      private and public companies, assisting them in capital formation, mergers
      and
      acquisitions, securities reporting compliance issues and general corporate
      administration. Mr. Kidder did not serve as an officer or a director of any
      company from December 2002 through December 2005. In December 2005, Mr. Kidder
      was named Secretary of TRAC Financial Group, Inc. He continued to serve in
      that
      capacity following a change in control of the company and name change to FINI
      Group, Inc. on July 28, 2006, until July 2007. From July 2007 through October
      2007, Mr. Kidder served as Secretary of Asset Capital Group, Inc. (“ACGU.PK”).
      Mr. Kidder earned his B.A. in Political Science and his Juris Doctor Degree
      from
      the University of Southern California.





The
      Company’s Board of Directors does not currently have an audit committee nor does
      it have a financial expert.





Members
      of our Board of Directors are not compensated.


18


ITEM
      10.
      EXECUTIVE COMPENSATION





COMPENSATION
      OF EXECUTIVE OFFICERS





The
      following table sets forth the annual and long-term compensation for services
      in
      all capacities for the fiscal years ended December 31, 2007, 2006 and 2005
      for
      our two principal officers.





SUMMARY
      COMPENSATION TABLE





Name and Principal Position
            
            Year
            
            Salary($)
            
            Bonus ($)
            
            Stock
              Awards ($)
            
            Option
              Awards ($)
            
            Non-Equity
              Incentive
              Plan
              Compensation
            
            All
              Other
              Compensation
              ($) (1)
            
            Total ($)Russell
                Kidder
            
            
            2007
            
            $
            -
            
            $
            -
            
            $
            -
            
            $
            -
            
            $
            -
            
            $
            -
            
            $
            -President,
                CEO andInterim
                CFOTimothy
                J Connolly,Former
                CEO
            
            
            2007
            
            $
            551,000
            
            $
            -
            
            $
            -
            
            $
            -
            
            $
            -
            
            $
            -
            
            $
            551,0002006
            
            $
            338,500
            
            $
            100,000
            
            $
            -
            
            $
            -
            
            $
            -
            
            $
            13,400
            
            $
            451,9002005
            
            $
            265,000
            
            $
            20,000
            
            $
            -
            
            $
            -
            
            $
            -
            
            $
            12,000
            
            $
            297,000Wm
                Chris Mathers,
            
            
            2007
            
            $
            60,000
            
            $
            -
            
            $
            -
            
            $
            -
            
            $
            -
            
            $
            -
            
            $
            60,000Former
                CFO
            
            
            2006
            
            $
            29,500
            
            $
            1,500
            
            $
            -
            
            $
            -
            
            $
            -
            
            $
            -
            
            $
            31,000





(1)
      -
      Auto allowance





Stock
      Incentive Plan





On
      May
      31, 2006,Turnaround Partners, Inc. 2006 Stock Incentive Plan (the "Plan") was
      adopted and approved by the shareholders. On a calendar year basis, an amount
      of
      shares of Common Stock equivalent to fifteen percent (15%) of the fully diluted
      shares outstanding on January 2 of any such calendar year may be allocated,
      at
      the discretion of the Administrator, to be granted as awards under the Plan,
      less awards outstanding at the end of the prior calendar year. The number of
      shares allocated to this plan was 10,000,000 shares. As of December 31, 2007,
      there were 7,250,000 shares available under the Plan.





For
      the
      years ended December 31, 2006 and 2007, there were no outstanding equity awards
      or options granted.





Employee
      Agreements





On
      September 1, 2004, Corporate Strategies entered into a five year employment
      agreement, effective June 1, 2004, with Timothy J. Connolly to serve as Chief
      Executive Officer and director of Corporate Strategies. The agreement has a
      renewal provision and provides for an annual salary and bonus upon attaining
      certain performance criteria set by the board of directors. The agreement also
      provides certain anti-dilution provisions in return for an extension of lock-up
      of the Chief Executive Officer's shares until December 31, 2007 and for certain
      other fringe benefits. Effective
      as of the Closing Date (December 5, 2007) of the agreement with ACGU, Mr.
      Connolly resigned as Vice Chairman of the Board and as President and Chief
      Executive Officer of the Company, however Mr. Connolly shall continue to serve
      as President and Chief Executive Officer of Corporate Strategies, Inc., a Texas
      corporation and wholly-owned subsidiary of the Company (“ CSI ”)
      with
      the understanding that the business of CSI will be discontinued or spun off
      to
      its stockholders. In addition, Mr. Connolly shall continue to receive the same
      compensation as he has received through the Closing Date for his aforementioned
      continued services to CSI through December 31, 2008, which such date may be
      extended by mutual agreement by and among the parties to the Purchase Agreement.





On
      September 1, 2004, Corporate Strategies entered into a three year employment
      agreement with Fred Zeidman to serve as President and a director of Corporate
      Strategies. The agreement has a renewal provision and provides for an annual
      salary and bonus upon attaining certain performance criteria set by the board
      of
      directors and certain fringe benefits; in addition, Mr. Zeidman received 50%
      of
      all consulting fees from companies directly provided by or supervised by him.
      The employment agreement with Mr. Zeidman has not been renewed as of the date
      of
      this filing and Mr. Zeidman no longer receives compensation from Corporate
      Strategies.





On
      December 2, 2005, Kipling entered into a three year employment agreement with
      Timothy J. Connolly to serve as President and Chief Executive Officer. The
      agreement has a renewal provision and provides for an annual salary.
      Additionally, Mr. Connolly is entitled to a 10% interest in any distributions
      of
      any kind, dividends, income, bonuses or sale of the property owned by the
      Company.


19


ITEM
      11.
      SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED
      SHAREHOLDER MATTERS





The
      table
      below sets forth information with respect to the beneficial ownership of our
      common stock and Series B and D Preferred Stock as of February 14, 2008 for
      (a)
      any person who we know is the beneficial owner of more than five percent (5%)
      of
      our outstanding common stock and Series B and D Preferred, (b) each of our
      directors and executive officers and (c) all of our directors and officers
      as a
      group. Other than the persons identified below, no person owned beneficially
      more than five percent (5%) of each of the Company's common stock and Series
      B
      Preferred. With the exception of the Company's 225 non-voting shares of Series
      C
      Preferred Stock, there are no other classes or series of capital stock
      outstanding. As of February 14, 2008, the Company had 494,236,058 shares of
      common stock, 6,666 shares of Series B Preferred and 700 shares of Series D
      Preferred issued and outstanding.





Title
                of Class
            
            Name
                and Address of
              Beneficial
                Owner
            
            Amount
                of
              Direct
              Ownership
            
            Amount
                &
              Nature
                of
              Indirect
              Beneficial
              Ownership
            
            Total
                of
              Directand
              Beneficial
              Ownership
            
            Percentage
              of
                Class(1)Common
            
            
            Viewpoint
                Capital, LLC
              2470
                Evening Twilight Lane
              Henderson,
                Nevada 89044
            
            
            300,000,000
            
            
            —
            
            
            300,000,000
            
            
            63.66
            %Common
            
            
            Michael
                O. Sutton
              10806
                Briar Branch Lane
              Houston,
                TX 77024
            
            
            10,723,600
            
            
            4,395,445
            (2)
            
            15,119,045
            
            
            3.21
            %Common
            
            
            Timothy
                J. Connolly
              109
                N. Post Oak Lane
              Suite
                422
              Houston,
                TX 77024
            
            
            —
            
            
            13,050,000
            (3)
            
            13,050,000
            
            
            9.99
            %Common
            
            
            Jan
                Carson Connolly
              8602
                Pasture View Lane
              Houston,
                TX 77024
            
            
            —
            
            
            13,050,000
            (4)
            
            13,050,000
            
            
            9.99
            %Common
            
            
            Gerald
                Holland
              22
                Coult Lane
              Old
                Lyme, CT 07601
            
            
            5,113,636
            
            
            177,740,511
            (5)
            
            182,854,147
            
            
            38.80
            %Common
            
            
            Joanna
                Saporito
              668
                W. Saddle River Rd.
              Ho-Ho-Kus,
                NJ 07423
            
            
            —
            
            
            72,421,863
            (5)
            
            72,421,863
            
            
            15.37
            %Common
            
            
            Mary-Ellen
                Viola
              249
                Long Hill Drive
              Short
                Hills, NJ 07078
            
            
            —
            
            
            13,050,000
            (5)
            
            13,050,000
            
            
            9.99
            %(6)Common
            
            
            David
                Kesselbrenner
              10
                Devonshire Rd.
              Livingston,
                NJ 07039
            
            
            —
            
            
            8,560,816
            (5)
            
            8,560,816
            
            
            1.82
            %Common
            
            
            Louis
                Kesselbrenner
              10
                Devonshire Rd.
              Livingston,
                NJ 07039
            
            
            —
            
            
            29,447,378
            (5)
            
            29,447,378
            
            
            6.25
            %Common
            
            
            Sarah
                Kesselbrenner
              10
                Devonshire Rd.
              Livingston,
                NJ 07039
            
            
            —
            
            
            29,447,378
            (5)
            
            29,447,378
            
            
            6.25
            %Common
            
            
            Joseph
                Kesselbrenner
              10
                Devonshire Rd.
              Livingston,
                NJ 07039
            
            
            —
            
            
            9,216,738
            (5)
            
            9,216,738
            
            
            1.96
            %Common
            
            
            YA
                Global Investments LP
              101
                Hudson Street
              Suite
                3700
              Jersey
                City, NJ 07302
            
            
            —
            
            
            6,120,000
            (5)
            
            6,120,000
            
            
            4.99
            %(7)Common
            
            
            Highgate
                House Funds, Ltd.
              101
                Hudson Street
              Suite
                3700
              Jersey
                City, NJ 07302
            
            
            —
            
            
            6,120,000
            (5)
            
            6,120,000
            
            
            4.99
            %(7)


20





(1)
            Applicable
                percentages of ownership are based on 471,236,054 shares of Common
                Stock
                on February 14, 2008 for each stockholder. Beneficial ownership is
                determined in accordance within the rules of the SEC and generally
                includes voting of investment power with respect to the securities. Shares
                subject to securities exercisable or convertible into shares of Common
                Stock that are currently exercisable or exercisable within sixty
                (60) days
                of February 14, 2008 are deemed to be beneficially owned by the person
                holding such derivative securities for the purpose of computing the
                percentage of ownership of such persons, but are not treated as
                outstanding for the purpose of computing the percentage ownership
                of any
                other person.(2)
            Includes
                4,195,445 shares which may be issued upon conversion of the 6,666
                shares
                of Series B Preferred Stock beneficially owned by Mr. Sutton and
                200,000
                shares directly held by his spouse.(3)
            Includes
                shares of Common Stock which may be issued upon conversion of 595
                shares
                of Series D Preferred Stock beneficially owned by Mr. Connolly and
                shares
                of Common Stock which may be issued upon conversion of 105 shares
                of
                Series D Preferred Stock beneficially owned by his spouse, subject
                to a
                9.99% ownership limitation set forth in the amended and restated
                Certificate of Designation of Series D Preferred Stock.(4)
            Includes
                shares of Common Stock which may be issued upon conversion of 105
                shares
                of Series D Preferred Stock beneficially owned by Ms. Connolly and
                shares
                of Common Stock which may be issued upon conversion of 595 shares
                of
                Series D Preferred Stock beneficially owned by her spouse, subject
                to a
                9.99% ownership limitation set forth in the amended and restated
                Certificate of Designation of Series D Preferred Stock.(5)
            These
                shares represent the approximate number of shares underlying convertible
                debentures at an assumed price of $0.001 in light of the fact that
                the
                Company is prohibited from issuing shares of Common Stock at a price
                per
                share below par. Because the conversion price will fluctuate based
                on the
                market price of the Company’s stock, the actual number of shares to be
                issued upon conversion of the debentures may be lower but cannot
                be
                higher.





(B)
      Security Ownership of Management




Title of Class
            
            Name and Address of Beneficial Owner
            
            Amount of
              Direct
              Ownership
            
            Amount & Nature
              of Beneficial
              Ownership
            
            Total of
              Direct and
              Beneficial
              Ownership
            
            Percentage
              of Class(1)Common
            
            
            Russell
                Kidder, President,
              Chief
                Executive Officer and Director
              109
                North Post Oak Lane
              Suite
                422
              Houston,
                TX 77024
            
            
            —
            
            
            —
            
            
            —
            
            
            0
            %Common
            
            
            Richard
                P. McLaughlin, Secretary
              109
                North Post Oak Lane
              Suite
                422
              Houston,
                TX 77024
            
            
            —
            
            
            —
            
            
            —
            
            
            0
            %ALL
                DIRECTORS ANDEXECUTIVE
                OFFICERS ASA
                GROUP (TWO PERSONS)(3)
            
            
            —
            
            
            —
            
            
            —
            
            
            **0**
            **%**




(1)
            Applicable
                percentages of ownership are based on 471,236,054 shares of Common
                Stock
                outstanding on February 14, 2008 for each stockholder. Beneficial
                ownership is determined in accordance within the rules of the SEC
                and
                generally includes voting of investment power with respect to the
                securities. Shares subject to securities exercisable or convertible
                into
                shares of Common Stock that are currently exercisable or exercisable
                within sixty (60) days of February 14, 2008 are deemed to be beneficially
                owned by the person


21


ITEM
      12.
      CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS





CONCENTRATION
      OF TRANSACTIONS WITH YA GLOBAL





At
      December 31, 2007, $7,826,100 of the convertible debentures are owed to YA
      Global and to Highgate House Funds, Ltd., an affiliate of YA
      Global.





YA
      Global
      was the principal lender to Nuwave both before and after the
      merger.





YA
      Global
      acquired Lehigh Acquisition Corp., formerly a wholly-owned subsidiary of NuWave,
      in February 2006. Lehigh owns the land held for development and sale. Proceeds
      from the sale of $5,556,356 reduced indebtedness to YA Global by
      $5,281,274.





YA
      Global
      has significant relationships with affiliated companies, both as a purchaser
      and
      lender.





ITEM
      13.
      EXHIBITS





(a)
      Documents Filed As Part Of This Report:





See
      Index
      to Consolidated Financial Statements attached which are filed as part of this
      Annual Report.





(b)
      Exhibits:





**EXHIBIT NO.**
            
            **DESCRIPTION**
            
            **LOCATION**2.1
            
            Agreement
                and Plan of Merger, dated as of November 22, 2006, by and between
                Emerge
                Capital Corp. (the Delaware corporation) and Turnaround Partners,
                Inc.
                (the Nevada corporation)
            
            Incorporated
                by reference to Exhibit 2.1 to the Company’s Current Report on Form 8-K as
                filed with the U.S. Securities and Exchange Commission on January
                5,
                2007.2.2
            
            Certificate
                of Ownership and Merger of Emerge Capital Corp. with and into Turnaround
                Partners, Inc.
            
            Incorporated
                by reference to Exhibit 2.2 to the Company’s Current Report on Form 8-K as
                filed with the U.S. Securities and Exchange Commission on January
                5,
                2007.2.3
            
            Articles
                of Merger of Turnaround Partners, Inc. and Emerge Capital
                Corp.
            
            Incorporated
                by reference to Exhibit 2.3 to the Company’s Current Report on Form 8-K as
                filed with the U.S. Securities and Exchange Commission on January
                5,
                2007.3.1
            
            Articles
                of Incorporation of Turnaround Partners, Inc.
            
            Incorporated
                by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K as
                filed with the U.S. Securities and Exchange Commission on January
                5,
                2007.3.2
            
            Bylaws
                of Turnaround Partners, Inc.
            
            Incorporated
                by reference to Exhibit 3.2 to the Company’s Current Report on Form 8-K as
                filed with the U.S. Securities and Exchange Commission on January
                5,
                2007.4.1
            
            2005
                Stock Incentive Plan
            
            Incorporated
                by reference to Appendix A to the Company's Definitive Information
                Statement as filed with the U.S. Securities and Exchange Commission
                on
                December 13, 20054.2
            
            Amended
                and Restated Certificate of Designation of Series D Preferred
                Stock
            
            Incorporated
                by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K as
                filed with the U.S. Securities and Exchange Commission on December
                14,
                2007.10.1
            
            Assignment
                and Amendment Agreement, dated January 26, 2004, related to the Secured
                Note Payable Agreement dated December 22, 2003, by and between Stone
                Street Asset Management, LLC and NuWave
            
            Incorporated
                by reference to Exhibit 99.7 to the Company’s Current Report on Form 8-K
                as filed with the U.S. Securities and Exchange Commission on January
                27,
                2005.10.2
            
            Convertible
                Debenture, issued on May 6, 2004, by Corporate Strategies, Inc to
                Cornell
                Capital Partners, LP
            
            Incorporated
                by reference to Exhibit 10.2 to the Company’s Annual Report on Form 10-KSB
                for the year ended December 31, 2005 as filed with the U.S. Securities
                and
                Exchange Commission on April 17, 200610.3
            
            Convertible
                Debenture, issued on June 24, 2004, by Corporate Strategies, Inc.
                to
                iVoice, Inc.
            
            Incorporated
                by reference to Exhibit 10.3 to the Company’s Annual Report on Form 10-KSB
                for the year ended December 31, 2005 as filed with the U.S. Securities
                and
                Exchange Commission on April 17, 200610.4
            
            Employment
                Agreement, dated September 1, 2004, by and between Corporate Strategies,
                Inc. and Timothy J. Connolly
            
            Incorporated
                by reference to Exhibit 10.4 to the Company’s Annual Report on Form 10-KSB
                for the year ended December 31, 2005 as filed with the U.S. Securities
                and
                Exchange Commission on April 17,
                2006


22





10.5
            
            Employment
                Agreement, dated September 1, 2004, by and between Corporate Strategies,
                Inc. and Fred Zeidman
            
            Incorporated
                by reference to Exhibit 10.5 to the Company’s Annual Report on Form 10-KSB
                for the year ended December 31, 2005 as filed with the U.S. Securities
                and
                Exchange Commission on April 17, 200610.6
            
            Convertible
                Debenture, issued on September 28, 2004, by Corporate Strategies,
                Inc. to
                Cornell Capital Partners, LP
            
            Incorporated
                by reference to Exhibit 10.6 to the Company’s Annual Report on Form 10-KSB
                for the year ended December 31, 2005 as filed with the U.S. Securities
                and
                Exchange Commission on April 17, 200610.7
            
            Termination
                Agreement, dated January 26, 2005, related to the Standby Equity
                Distribution dated as of May 2004 by and between the Company and
                Cornell
                Capital Partners, LP
            
            Incorporated
                by reference to Exhibit 99.1 to the Company’s Current Report on Form 8-K
                as filed with the U.S. Securities and Exchange Commission on January
                27,
                2005.10.8
            
            Standby
                Equity Distribution Agreement, dated as of January 26, 2005, between
                the
                Company and Cornell Capital Partners, LP
            
            Incorporated
                by reference to Exhibit 99.2 to the Company’s Current Report on Form 8-K
                as filed with the U.S. Securities and Exchange Commission on January
                27,
                2005.10.9
            
            Registration
                Rights Agreement, dated as of January 26, 2005, by and between the
                Company
                and Cornell Capital Partners, LP
            
            Incorporated
                by reference to Exhibit 99.3 to the Company’s Current Report on Form 8-K
                as filed with the U.S. Securities and Exchange Commission on January
                27,
                2005.10.10
            
            Placement
                Agent Agreement, dated as of January 26, 2005, by and among the Company,
                Cornell capital Partners, LP and Newbridge Securities
                Corporation
            
            Incorporated
                by reference to Exhibit 99.4 to the Company’s Current Report on Form 8-K
                as filed with the U.S. Securities and Exchange Commission on January
                27,
                2005.10.11
            
            Termination
                Agreement, dated January 26, 2005, related to the Convertible Debenture
                issued by the Company and Cornell Capital Partners, LP on December
                22,
                2003
            
            Incorporated
                by reference to Exhibit 99.5 to the Company’s Current Report on Form 8-K
                as filed with the U.S. Securities and Exchange Commission on January
                27,
                2005.10.12
            
            Promissory
                Note, dated as of January 2, 2005, issued by the Company to Cornell
                Capital Partner, LP
            
            Incorporated
                by reference to Exhibit 99.6 to the Company’s Current Report on Form 8-K
                as filed with the U.S. Securities and Exchange Commission on January
                27,
                2005.10.13
            
            Convertible
                Debenture, issued on April 6, 2005, by Corporate Strategies, Inc.
                to
                Cornell Capital Partners, LP
            
            Incorporated
                by reference to Exhibit 10.13 to the Company’s Annual Report on Form
                10-KSB for the year ended December 31, 2005 as filed with the U.S.
                Securities and Exchange Commission on April 17, 200610.14
            
            $250,000
                Convertible Debenture, dated as of May 5, 2005, issued to Cornell
                Capital
                Partners, LP
            
            Incorporated
                by reference to Exhibit 99.1 to the Company’s Current Report on Form 8-K
                as filed with the U.S. Securities and Exchange Commission on May
                10,
                2005.10.15
            
            Letter
                of Intent, dated June 3, 2005, by and between the Company and Corporate
                Strategies, Inc.
            
            Incorporated
                by reference to Exhibit 99.1 to the Company’s Current Report on Form 8-K
                as filed with the U.S. Securities and Exchange Commission on June
                16,
                2005.10.16
            
            $150,000
                Convertible Debenture, dated as of July 20, 2005, issued to Cornell
                Capital Partners, LP
            
            Incorporated
                by reference to Exhibit 99.1 to the Company’s Current Report on Form 8-K
                as filed with the U.S. Securities and Exchange Commission on July
                28,
                2005.10.17
            
            Merger
                Agreement, dated as of August 31, 2005, by and among NuWave Technologies,
                Inc., Strategies Acquisition Corp., Corporate Strategies, Inc. and
                the
                Shareholders listed therein
            
            Incorporated
                by reference to Exhibit 99.1 to the Company’s Current Report on Form 8-K/A
                as filed with the U.S. Securities and Exchange Commission on September
                8,
                2005.10.18
            
            Services
                Agreement, dated October 1, 2005, by and between Timothy J. Connolly
                and
                Sagamore Holdings, Inc.
            
            Incorporated
                by reference to Exhibit 10.18 to the Company’s Annual Report on Form
                10-KSB for the year ended December 31, 2005 as filed with the U.S.
                Securities and Exchange Commission on April 17, 200610.19
            
            Stock
                Purchase Agreement, dated as of November 11, 2005, by and among Corporate
                Strategies, Inc., Mr. Robert P. Farrell and Mr. Joseph W. Donohue,
                Jr.
            
            Incorporated
                by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K
                as filed with the U.S. Securities and Exchange Commission on January
                30,
                2006.10.20
            
            Letter,
                dated November 18, 2005, from Cornell Capital Partners, LP to modify
                certain Debentures
            
            Incorporated
                by reference to Exhibit 10.21 to the Company’s Annual Report on Form
                10-KSB for the year ended December 31, 2005 as filed with the U.S.
                Securities and Exchange Commission on April 17, 200610.21
            
            Consulting
                Agreement, dated December 14, 2005, by and between Timothy J. Connolly
                on
                behalf of Corporate Strategies, Inc. and Elite Flight Solutions,
                Inc.
            
            Incorporated
                by reference to Exhibit 10.22 to the Company’s Annual Report on Form
                10-KSB for the year ended December 31, 2005 as filed with the U.S.
                Securities and Exchange Commission on April 17,
                2006


23





10.22
            
            Convertible
                Debenture, issued December 31, 2005, by Elite Flight Solutions, Inc.
                to
                Corporate Strategies, Inc.
            
            Incorporated
                by reference to Exhibit 10.23 to the Company’s Annual Report on Form
                10-KSB for the year ended December 31, 2005 as filed with the U.S.
                Securities and Exchange Commission on April 17, 200610.23
            
            Consulting
                Agreement, dated January 1, 2006, by and between Timothy J. Connolly
                and
                Power Technology, Inc.
            
            Incorporated
                by reference to Exhibit 10.24 to the Company’s Annual Report on Form
                10-KSB for the year ended December 31, 2005 as filed with the U.S.
                Securities and Exchange Commission on April 17, 200610.24
            
            Consulting
                Agreement, dated January 1, 2006, by and between Timothy J. Connolly
                on
                behalf of Corporate Strategies, Inc. and TRAC Financial Group,
                Inc.
            
            Incorporated
                by reference to Exhibit 10.25 to the Company’s Annual Report on Form
                10-KSB for the year ended December 31, 2005 as filed with the U.S.
                Securities and Exchange Commission on April 17, 200610.25
            
            Assumption
                Agreement, dated February 7, 2006, by and between Lehigh and Cornell
                capital Partners, LP
            
            Incorporated
                by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K
                as filed with the U.S. Securities and Exchange Commission on February
                15,
                2006.10.26
            
            Stock
                Purchase Agreement, dated as of February 3, 2006, by and between
                the
                Company and Cornell Capital Partners, LP
            
            Incorporated
                by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K
                as filed with the U.S. Securities and Exchange Commission on February
                15,
                2006.10.27
            
            Joinder
                Agreement, dated as of February 11, 2006, effective as of December
                31,
                2005, by Elite Flight Solutions, Inc.
            
            Incorporated
                by reference to Exhibit 10.5 to the Company’s Current Report on Form 8-K
                as filed with the U.S. Securities and Exchange Commission on February
                28,
                2006.10.28
            
            Security
                Agreement, dated as of February 11, 2006, effective as of December
                31,
                2005, by and between Elite Flight Solutions, Inc. and Corporate
                Strategies, Inc.
            
            Incorporated
                by reference to Exhibit 10.4 to the Company’s Current Report on Form 8-K
                as filed with the U.S. Securities and Exchange Commission on February
                28,
                2006.10.29
            
            Secured
                Convertible Debenture, dated as of February 11, 2006, effective as
                of
                December 31, 2005, issued to Corporate Strategies, Inc.
            
            Incorporated
                by reference to Exhibit 10.3 to the Company’s Current Report on Form 8-K
                as filed with the U.S. Securities and Exchange Commission on February
                28,
                2006.10.30
            
            Registration
                Rights Agreement, dated as of February 11, 2006, effective as of
                December
                31, 2005, by and between Elite Flight Solutions, Inc. and Corporate
                Strategies, Inc.
            
            Incorporated
                by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K
                as filed with the U.S. Securities and Exchange Commission on February
                28,
                2006.10.31
            
            Securities
                Purchase Agreement, dated as of February 11, 2006, effective as of
                December 31, 2005, by and between Elite Flight Solutions, Inc. and
                Corporate Strategies, Inc.
            
            Incorporated
                by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K
                as filed with the U.S. Securities and Exchange Commission on February
                28,
                2006.10.32
            
            Purchase
                Agreement, dated as of September 30, 2006, by and among Emerge Capital
                Corp., Kipling Holdings, Inc. and Timothy J. Connolly
            
            Incorporated
                by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K
                as filed with the U.S. Securities and Exchange Commission on October
                6,
                2006.10.33
            
            First
                Amendment to Purchase Agreement, dated October 5, 2006, by and among
                Emerge Capital Corp, Kipling Holdings, Inc. and Timothy J.
                Connolly
            
            Incorporated
                by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K
                as filed with the U.S. Securities and Exchange Commission on October
                6,
                2006.10.34
            
            Second
                Amendment to Purchase Agreement, effective as of December 31, 2006,
                by and
                among Emerge Capital Corp, Kipling Holdings, Inc. and Timothy J.
                Connolly
            
            Incorporated
                by reference to Exhibit 10.34 to the Company’s Annual Report on Form
                10-KSB for the year ended December 31, 2006 as filed with the U.S.
                Securities and Exchange Commission on April 17, 200710.35
            
            Letter
                Agreement, dated October 9, 2007, by and between Corporate Strategies,
                In.
                and YA Global Investments, L.P.
            
            Incorporated
                by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K
                as filed with the U.S. Securities and Exchange Commission on October
                15,
                2007.10.36
            
            Stock
                Purchase Agreement, dated December 5, 2007, by and among Turnaround
                Partners, Inc., Mr. Timothy J. Connolly and Viewpoint Capital,
                LLC
            
            Incorporated
                by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K
                as filed with the U.S. Securities and Exchange Commission on December
                11,
                2007.16.1
            
            Letter
                dated November 9, 2005, from Weiser LLP
            
            Incorporated
                by reference to Exhibit 99.1 to the Company’s Current Report on Form 8-K
                as filed with the U.S. Securities and Exchange Commission on November
                14,
                2005, 2005.31.1
            
            Certification
                by Chief Executive Officer pursuant to 15.U.S.C. Section 7241, as
                adopted
                pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
            
            included
              herein


24





32.1
            
            Certification
                by Chief Executive Officer pursuant to 18.U.S.C. Section 1350, as
                adopted
                pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
            
            included
              herein





ITEM
      14.
      PRINCIPAL ACCOUNTANT FEES AND SERVICES





(1)
      Audit
      Fees. Turnaround Partners, Inc. paid to Thomas Leger & Co., L.L.P. ("Leger")
      audit fees of $0.00 for the audit of fiscal year 2007 and $93,625 for fiscal
      year 2006. The Company paid Leger audit fees of $28,040 and $48,195 for the
      2007
      and 2006 quarterly reviews, respectively. We have not received any invoices
      for
      the 2007 audit fees through April 17, 2008.





(2)
      Audit-related fees. Turnaround Partners, Inc. paid Leger audit-related fees
      of
      $3,950 for costs associated with our S-8 filing in 2006.





(3)
      Tax
      Fees. The Company has not paid for tax services to Leger.





(4)
      All
      Other Fees. The Company paid $4,910 for other services to Leger.





(5)
      Audit
      Committee pre-approval policies and procedures. The Company does not currently
      have an audit committee. Russell Kidder, Director of Turnaround Partners, Inc.,
      approved the engagement of Leger.


25


**SIGNATURES**





In
      accordance with the requirements of the Exchange Act, the Company has caused
      this Annual Report on Form 10-KSB to be signed on its behalf by the undersigned,
      thereunto duly authorized.




Date:
                  May 14, 2008
              Turnaround
                  Partners, Inc.(Registrant)/s/
                  Russell KidderRussell
                  Kidder
                President,
                  Chief Executive Officer and Interim CFO





Pursuant
      to the requirements of the Securities Exchange Act of 1934, this report has
      been
      signed below by the following persons on behalf of the registrant and in the
      capacities and on the dates indicated.




*/s/
                  Russell Kidder*
              
              May
                  14, 2008Name:
                  Russell Kidder
                Titles:
                  Chief Executive Officer, Interim Chief Financial Officer, Principal
                  Executive Officer, Interim Principal Financial and Accounting Officer
                  and
                  Director


26




INDEX
      TO
      CONSOLIDATED FINANCIAL STATEMENTS





TABLE
      OF
      CONTENTS





PAGEReport
                of Independent Registered Public Accounting Firm
            
            F-1Consolidated
                Balance Sheet as of December 31, 2007
            
            F-2Consolidated
                Statements of Operations for the Years Ended December 31, 2007 and
                2006
            
            F-4Consolidated
                Statements of Changes in Shareholders' Deficit for the Years Ended
                December 31, 2007 and 2006
            
            F-6Consolidated
                Statements of Cash Flows for the Years Ended December 31, 2007 and
                2006
            
            F-7Notes
                to the Consolidated Financial Statements
            
            F-9
                to F-28





REPORT
      OF
      INDEPENDENT REGISTERED PUBLIC ACCOUNTING FRIM





To
      the
      Shareholders


Turnaround
      Partners, Inc. and Subsidiaries


Houston,
      Texas





We
      have
      audited the accompanying consolidated balance sheet of Turnaround Partners,
      Inc.
      and Subsidiaries as of December 31, 2007 and the related consolidated statements
      of operations, changes in shareholders' deficit, and cash flows for the years
      ended December 31, 2007 and 2006. These consolidated financial statements are
      the responsibility of the Company's management. Our responsibility is to express
      an opinion on these consolidated financial statements based on our
      audit.





We
      conducted our audit in accordance with the standards of the Public Company
      Accounting Oversight Board (United States). Those standards require that we
      plan
      and perform the audit to obtain reasonable assurance about whether the
      consolidated financial statements are free of material misstatement. An audit
      includes examining, on a test basis, evidence supporting the amounts and
      disclosures in the consolidated financial statements. An audit also includes
      assessing the accounting principles used and significant estimates made by
      management, as well as evaluating the overall consolidated financial statement
      presentation. We believe that our audit provides a reasonable basis for our
      opinion.





In
      our
      opinion, the consolidated financial statements referred to above present fairly,
      in all material respects the financial position of Turnaround Partners, Inc.
      and
      Subsidiaries as of December 31, 2007, and the consolidated results of their
      operations and their cash flows for the years ended December 31, 2007 and 2006
      in conformity with accounting principles generally accepted in the United States
      of America.





/s/
                Thomas Leger & Co., L.L.P.Thomas
                Leger & Co., L.L.P.





April
      30,
      2008


Houston,
      Texas







**TURNAROUND
      PARTNERS, INC. AND SUBSIDIARIES**


**CONSOLIDATED
      BALANCE SHEET**


**December
      31, 2007**





**ASSETS****CURRENT
                ASSETS**Cash
                and cash equivalents
            
            $
            255,961Notes
                and accounts receivable, net of allowance accounts of
                $482,686
            
            
            299,576Investment
                in marketable securities
            
            
            510,791Prepaid
                expense and deferred financing costs
            
            
            23,208Total
                current assets
            
            
            1,089,536**NONCURRENT
                ASSETS**Investment
                in real estate partnership and other investments, at cost
            
            
            3,749,859Deferred
                debenture costs
            
            
            25,506Total
                noncurrent assets
            
            
            3,775,365**TOTAL
                ASSETS**
            
            $
            4,864,901**LIABILITIES
                AND SHAREHOLDERS' DEFICIT****CURRENT
                LIABILITIES**Accounts
                payable and accrued liabilities
            
            $
            607,181Unearned
                income
            
            
            9,167Convertible
                debentures
            
            
            1,932,475Notes
                payable
            
            
            96,003Series
                C Preferred stock including associated paid in capital; liquidation
                preference of $337,380,**redeemable
                at $1,500 per share at Company option, cumulative dividends of $120
                per
                share per year, non-voting, par value $.01, 1,000 shares authorized,
                225
                shares issued and outstanding
            
            
            337,380Derivative
                liability
            
            
            282,181Total
                current liabilities
            
            
            3,264,387Convertible
                debentures--net of $1,136,193 discount
            
            
            5,088,807Note
                payable
            
            
            110,978Accrued
                interest payable
            
            
            903,746Total
                liabilities
            
            
            9,367,918**COMMITMENTS
                AND CONTINGENCIES**
            
            
            -


F-2





**TURNAROUND
      PARTNERS, INC. AND SUBSIDIARIES**


**CONSOLIDATED
      BALANCE SHEET**


**December
      31, 2007**


**(Continued)**





**SHAREHOLDERS'
                DEFICIT**Preferred
                Stock, par value $.01, 2,000,000 shares authorized:Series
                A Convertible Preferred Stock, noncumulative, $.01 par value; 400,000
                shares authorized; none issued
            
            
            -Series
                B Convertible Preferred Stock, $.01 par value; 100,000 shares authorized;
                6,666 shares issued and outstanding; no liquidation or redemption
                value
            
            
            67Series
                D Convertible Preferred Stock, $.01 par value; 100,000 shares authorized;
                700 shares issued and outstanding; no liquidation or redemption
                value
            
            
            7Series
                E Convertible Preferred Stock, $.001 par value; 1 shares authorized;
                1
                share issued and outstanding; no liquidation or redemption
                value
            
            
            -Common
                stock, $.001 par value; 5,000,000,000 shares authorized; 135,236,054
                shares issued and outstanding
            
            
            135,235Additional
                paid-in capital
            
            
            1,049,994Retained
                deficit
            
            
            (5,688,320
            )Total
                shareholders' deficit
            
            
            (4,503,017
            )**TOTAL
                LIABILITIES AND SHAREHOLDERS' DEFICIT**
            
            $
            4,864,901




See
      accompanying Notes to Consolidated Financial Statements


F-3





**TURNAROUND
      PARTNERS, INC. AND SUBSIDIARIES**


**CONSOLIDATED
      STATEMENTS OF OPERATIONS**


**FOR
      THE YEARS ENDED**





**2007**
            
            **2006****REVENUE**Discount
                income
            
            $
            -
            
            $
            10,425Consulting
                revenue
            
            
            1,356,160
            
            
            963,277Marketable
                securities loss
            
            
            (303,373
            )
            
            (51,093
            )Fee
                income
            
            
            54,650
            
            
            204,610Total
                revenue
            
            
            1,107,437
            
            
            1,127,219**GENERAL
                AND ADMINISTRATIVE EXPENSES**Salaries
                and benefits
            
            
            831,214
            
            
            892,286Advertising
            
            
            69,455
            
            
            120,155Business
                develeopment, travel and entertainment
            
            
            62,828
            
            
            86,685Rent
            
            
            87,453
            
            
            76,395Depreciation
                and amortization
            
            
            24,041
            
            
            23,874Professional
                fees
            
            
            479,161
            
            
            855,722Bad
                debt
            
            
            524,414
            
            
            243,302Other
                expenses
            
            
            211,048
            
            
            271,995Allocated
                overhead to affiliated entity
            
            
            (243,951
            )
            
            (308,481
            )Total
                general and administrative expenses
            
            
            2,045,663
            
            
            2,261,933**OPERATING
                LOSS**
            
            
            (938,226
            )
            
            (1,134,714
            )Other
                (income) expense:Net
                change in fair value of derivative liabilities
            
            
            (141,664
            )
            
            (3,642,080
            )Income
                on debt extinguishment
            
            
            (450,650
            )
            
            (130,563
            )Merger
                expense
            
            
            -
            
            
            140,000Interest
                expense
            
            
            586,508
            
            
            273,802Interest
                expense - derivatives
            
            
            834,572
            
            
            600,071Interest
                Income
            
            
            (17,455
            )
            
            (54,790
            )Loss
                from operations and impairment of investment in real estate
                partnership
            
            
            685,136
            
            
            78,095Other
                (income) expense
            
            
            170,302
            
            
            (22,605
            )Total
                other (income) expense
            
            
            1,666,749
            
            
            (2,758,070
            )Income
                (loss) before income tax
            
            
            (2,604,975
            )
            
            1,623,356**INCOME
                TAX PROVISION**Current
                income tax benefit
            
            
            -
            
            
            -Deferred
                income tax expense (benefit )
            
            
            -
            
            
            -Total
                income tax expense (benefit)
            
            
            -
            
            
            -**INCOME
                (LOSS) FROM CONTINUING OPERATIONS**
            
            
            (2,604,975
            )
            
            1,623,356


F-4





**TURNAROUND
      PARTNERS, INC. AND SUBSIDIARIES**


**CONSOLIDATED
      STATEMENTS OF OPERATIONS**


**FOR
      THE YEARS ENDED**


**(continued)**





**2007**
            
            **2006****INCOME
                (LOSS) FROM DISCONTINUED OPERATIONS**Loss
                from discontinued operations
            
            
            -
            
            
            (4,688
            )Gain
                on sale of subsidiaries
            
            
            -
            
            
            3,317,406**NET
                INCOME (LOSS)**
            
            
            (2,604,975
            )
            
            4,936,074Preferred
                dividends paid
            
            
            -
            
            
            4,554**INCOME
                (LOSS) AVAILABLE TO COMMON SHARES**
            
            $
            (2,604,975
            )
            $
            4,931,520Basic
                income (loss) per share:Income
                (loss) from continuing operations
            
            
            (0.04
            )
            
            0.06Income
                (loss) from discontinued operations
            
            
            -
            
            
            0.13$
            (0.04
            )
            $
            0.19Diluted
                income (loss) per share:Income
                (loss) from continuing operations
            
            
            -
            
            
            0.02Income
                (loss) from discontinued operations
            
            
            -
            
            
            0.03$
            -
            
            $
            0.05Basic
                average shares outstanding
            
            
            63,733,188
            
            
            25,505,662Diluted
                average shares outstanding
            
            
            63,733,188
            
            
            98,411,949





See
      accompanying Notes to Consolidated Financial Statements


F-5





**TURNAROUND
      PARTNERS, INC. AND SUBSIDIARIES**


**CONSOLIDATED
      STATEMENT OF CHANGES IN SHAREHOLDERS' DEFICIT**


**For
      the Years Ended December 31, 2006 and 2007**


**Additional****Series
                  B Preferred**
              
              **Series
                  C Preferred**
              
              **Series
                  D Preferred**
              
              **Series
                  E Preferred**
              
              **Common
                  Stock**
              
              **Paid-in**
              
              **Retained****Shares**
              
              **Amount**
              
              **Shares**
              
              **Amount**
              
              **Shares**
              
              **Amount**
              
              **Shares**
              
              **Amount**
              
              **Shares**
              
              **Amount**
              
              **Capital**
              
              **Deficit**
              
              **Total**Balance,
                  December 31, 2005
              
              
              100,000
              
              $
              1,000
              
              
              536
              
              $
              5
              
              
              -
              
              $
              -
              
              
              -
              
              $
              -
              
              
              22,710,816
              
              $
              22,711
              
              $
              719,638
              
              $
              (4,701,603
              )
              $
              (3,958,249
              )Issuance
                  of common stock:For
                  services
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              4,800,000
              
              
              4,800
              
              
              287,700
              
              
              -
              
              
              292,500Conversion
                  of debentures
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              1,936,688
              
              
              1,936
              
              
              62,065
              
              
              
              
              
              64,001Issuance
                  of 3,000,000 warrants for services
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              141,000
              
              
              -
              
              
              141,000Redemption
                  of preferred stock
              
              
              -
              
              
              -
              
              
              (282
              )
              
              (3
              )
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              (243,498
              )
              
              -
              
              
              (243,501
              )Transfer
                  preferred stock tocurrent liability
              
              
              -
              
              
              -
              
              
              (254
              )
              
              (2
              )
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              (224,976
              )
              
              -
              
              
              (224,978
              )Exchange
                  of series B preferred forseries D preferred
              
              
              (93,334
              )
              
              (933
              )
              
              -
              
              
              -
              
              
              93,334
              
              
              933
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -Reduction
                  in series D preferred shares
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              (92,634
              )
              
              (926
              )
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              926
              
              
              -
              
              
              -Deemed
                  distribution to shareholder
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              (3,313,264
              )
              
              (3,313,264
              )Net
                  income
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              4,936,074
              
              
              4,936,074Preferred
                  dividends paid
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              (4,554
              )
              
              (4,554
              )Balance,
                  December 31, 2006
              
              
              6,666
              
              
              67
              
              
              -
              
              
              -
              
              
              700
              
              
              7
              
              
              -
              
              
              -
              
              
              29,447,504
              
              
              29,447
              
              
              742,855
              
              
              (3,083,345
              )
              
              (2,310,969
              )Issuance
                  of common stock:For
                  services
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              1,192,307
              
              
              1,192
              
              
              14,308
              
              
              -
              
              
              15,500Conversion
                  of debentures
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              104,596,247
              
              
              104,596
              
              
              285,673
              
              
              
              
              
              390,269Proceeds
                  for sale of stock received for Series E preferred stock
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              1
              
              
              -
              
              
              -
              
              
              -
              
              
              7,158
              
              
              -
              
              
              7,158Net
                  loss
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              (2,604,975
              )
              
              (2,604,975
              )Balance,
                  December 31, 2007
              
              
              6,666
              
              $
              67
              
              
              -
              
              $
              -
              
              
              700
              
              $
              7
              
              
              1
              
              $
              -
              
              
              135,236,058
              
              $
              135,235
              
              
              1,049,994
              
              $
              (5,688,320
              )
              $
              (4,503,017
              )





See
      accompanying Notes to Consolidated Financial Statements


F-6




**TURNAROUND
      PARTNER INC. AND SUBSIDIARIES**


**CONSOLIDATED
      STATEMENTS OF CASH FLOWS**





**Year
                Ended December 31,****2007**
            
            **2006****CASH
                FLOWS FROM OPERATING ACTIVITIES**Net
                income (loss)
            
            $
            (2,604,975
            )
            $
            4,936,074Adjustment
                to reconcile net income (loss) to net cash provided by (used in)
                operating
                activities:Depreciation
                and amortization
            
            
            24,041
            
            
            23,874Amortization
                of deferred expenses
            
            
            324,918
            
            
            60,638Bad
                debts
            
            
            484,414
            
            
            243,302Loss
                from discontinued operations
            
            
            -
            
            
            4,688Non-cash
                stock issued for services
            
            
            15,500
            
            
            62,077Non-cash
                consulting fees
            
            
            (889,804
            )
            
            -Non-cash
                merger expense
            
            
            -
            
            
            140,000Non-cash
                expense for redemption of preferred stock
            
            
            152,834
            
            
            3,072Non-cash
                expenses
            
            
            75,853
            
            
            88,095Non-cash
                interest expense-derivatives
            
            
            860,233
            
            
            600,071Net
                change in fair value of derivative liability
            
            
            (167,325
            )
            
            (3,642,080
            )Non-cash
                debt modification gain
            
            
            (450,250
            )
            
            (130,563
            )Non-cash
                gain on sale of subsidary
            
            
            -
            
            
            (3,317,406
            )Non-cash
                income
            
            
            (289,722
            )
            
            (541,527
            )Loss
                from and impairment of investment in real estate partnership
            
            
            685,136
            
            
            -(Increase)
                decrease in assets:Other
                accounts receivable
            
            
            295,216
            
            
            (245,186
            )Notes
                receivable
            
            
            6,415
            
            
            211,142Prepaid
                and other
            
            
            (89,562
            )
            
            102,412Investment
                in marketable securities
            
            
            (246,137
            )
            
            391,060Increase
                (decrease) in liabilities:Accounts
                payable
            
            
            (37,623
            )
            
            (8,588
            )Accrued
                liabilities
            
            
            (152,236
            )
            
            241,405Unearned
                income
            
            
            76,667
            
            
            717,749Due
                to clients
            
            
            -
            
            
            (19,608
            )Accrued
                interest
            
            
            435,750
            
            
            225,418Net
                cash provided by (used in) operating activities
            
            
            (1,490,657
            )
            
            146,119**CASH
                FLOWS FROM INVESTING ACTIVITIES**Purchases
                of fixed assets
            
            
            (3,091
            )
            
            (21,784
            )Cash
                received in purchase and from sale of subsidiary
            
            
            -
            
            
            559,742Cash
                received for sale of investment
            
            
            198,899
            
            
            -Cash
                paid in purchase of subsidiary
            
            
            -
            
            
            (10,000
            )Investment
                purchases
            
            
            -
            
            
            (7,073
            )Preferental
                returns on capital of and distribution from partnership
            
            
            481,250
            
            
            78,750Net
                cash provided by investing activities
            
            
            677,058
            
            
            599,635


F-7





**TURNAROUND
      PARTNER INC. AND SUBSIDIARIES**


**CONSOLIDATED
      STATEMENTS OF CASH FLOWS**


**(Continued)**





**Year
                  Ended December 31,****2007**
              
              **2006****CASH
                  FLOWS FROM FINANCING ACTIVITIES**Principal
                  payments on note payable
              
              
              (84,233
              )
              
              (64,258
              )Dividends
                  paid on preferred stock
              
              
              -
              
              
              (4,554
              )Net
                  cash used in financing activities
              
              
              (84,233
              )
              
              (68,812
              )**NET
                  INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS**
              
              
              (897,832
              )
              
              676,942**CASH
                  AND CASH EQUIVALENTS, BEGINNING OF PERIOD**
              
              
              1,153,793
              
              
              476,851**CASH
                  AND CASH EQUIVALENTS, END OF PERIOD**
              
              $
              255,961
              
              $
              1,153,793**SUPPLEMENTAL
                  INFORMATION**Interest
                  paid
              
              $
              50,040
              
              $
              14,689Taxes
                  paid
              
              $
              -
              
              $
              9,882Decrease
                  in notes receivable
              
              $
              900,000
              
              $
              -Acquisition
                  of investment
              
              $
              1,789,804
              
              $
              -Conversion
                  of convertible debentures and accrued interest:Decrease
                  in debentures and accrued interest
              
              $
              390,265
              
              $
              63,996Increase
                  in common stock
              
              $
              104,596
              
              $
              1,936Increase
                  in paid-in-capital
              
              $
              285,673
              
              $
              62,065Sale
                  of Preferred Stock - Series EIncrease
                  in Accounts Receivable
              
              $
              7,158
              
              $
              -Increase
                  in Paid-in-capital
              
              $
              7,158
              
              $
              -Disposition
                  of investmentPurchase
                  of notes receivable
              
              $
              586,000
              
              $
              -Collection
                  of affiliate receivable
              
              $
              106,905
              
              $
              -Decrease
                  in investment exchanged for notes receivable and affiliate
                  receivable
              
              $
              889,804
              
              $
              -Redemption
                  of preferred stock
              
              $
              36,000
              
              $
              -Disposition
                  of furniture and fixtures
              
              $
              48,837
              
              $
              -Exercise
                  of investment of stock warrants
              
              $
              11,000
              
              $
              -Redemption
                  and purchase of preferred stock:Decrease
                  in accounts receivable
              
              $
              -
              
              $
              22,500Increase
                  in notes payable
              
              $
              -
              
              $
              240,000Decrease
                  in paid-in capital
              
              $
              -
              
              $
              243,498Sale
                  of subsidiary:Assets
                  sold
              
              $
              -
              
              $
              2,906,001Liabilities
                  assumed by buyer
              
              $
              -
              
              $
              5,861,821Purchase
                  of subsidiary:Assets
                  purchased
              
              $
              -
              
              $
              5,081,476Liabilities
                  assumed
              
              $
              -
              
              $
              3,906,744Deemed
                  distribution
              
              $
              -
              
              $
              3,313,264Common
                  stock and warrants issued for services:Increase
                  in prepaids
              
              $
              -
              
              $
              221,423Increase
                  in common stock
              
              $
              -
              
              $
              3,800Increase
                  in paid-in-capital
              
              $
              -
              
              $
              279,700





See
      accompanying Notes to Consolidated Financial Statements


F-8


TURNAROUND
      PARTNERS, INC. AND SUBSIDIARIES





NOTES
      TO
      CONSOLIDATED FINANCIAL STATEMENTS





DECEMBER
      31, 2007 and 2006





NOTE
      1 -
      DESCRIPTION OF MERGER, NATURE OF OPERATIONS AND CONSOLIDATION





On
      August
      31, 2005, NuWave entered into a merger agreement (the "Agreement") with
      Corporate Strategies, Inc. ("Corporate Strategies") and the shareholders of
      Corporate Strategies ("Shareholders"). The Company was subsequently renamed
      Turnaround Partners, Inc. The transaction was accounted for as a reverse
      acquisition since control of the merged group passed to the shareholders of
      the
      acquired company (Corporate Strategies).





Pursuant
      to the terms of the Agreement, the Company issued one (1) share of its common
      stock ("Common Stock"), par value $0.001 per share, to each holder of Corporate
      Strategies Class A common stock in exchange for two (2) shares of Corporate
      Strategies Class A common stock, par value $0.001 per share. Second, the Company
      issued one (1) share of the Company's Series C preferred stock ("Series C
      Preferred"), par value $0.01 per share, to each holder of Corporate Strategies
      Series A preferred stock for one (1) share of Corporate Strategies Series A
      preferred stock, par value $0.001 per share.





The
      Company issued and delivered shares of its Series B convertible Preferred stock
      ("Series B Preferred") to each holder of Corporate Strategies Class B common
      stock so that effectively upon conversion of the Series B Preferred into common
      shares, the common shares issued upon conversion shall be equal to ninety-five
      percent (95%) of the issued and outstanding stock of the Company (calculated
      on
      a fully diluted basis as of the date of the Merger, following the issuance
      of
      all the Merger Consideration (as such term is defined in the Agreement) and
      after giving effect to such conversion, but not including any shares of Common
      Stock issuable upon conversion of any then outstanding Company convertible
      debentures ). Therefore, the Merger Consideration for the Common Stock, Series
      C
      Preferred and Series B Preferred was the Corporate Strategies Class A common,
      Series A preferred and Class B common, respectively. The number of shares issued
      to the Shareholders in connection with the Merger was based upon a determination
      by the Company's Board of Directors (the "Board").





The
      terms
      of the Series B Preferred were subsequently modified. In connection with the
      Kipling purchase, 93,334 shares of Series B Preferred were exchanged for a
      like
      number of Series D Preferred, which were subsequently reduced to 700 shares
      of
      Series D Preferred. The remaining 6,666 shares of Series B Preferred are
      convertible into 4,195,445 shares of common stock. Each
      share of the Series D may be convertible, at the option of the holder, at any
      time and from time to time after December 31, 2006 through June 30, 2009, into
      that number of shares of Common Stock equal to the greater of (a) one tenth
      of
      one percent (0.1%) of the total number of shares of Common Stock issued and
      outstanding as of the last day of the fiscal quarter immediately preceding
      such
      date of conversion, calculated on a fully diluted basis after giving effect
      to
      the conversion of such share(s) of Series D and (b) One Hundred Thousand
      (100,000) shares of Common Stock. Each share of Series D Preferred Stock held
      by
      the Holders which has not been converted on or before June 30, 2009 into shares
      of Common Stock shall be convertible, at the option of the Holder of such share,
      at any time and from time to time after December 31, 2010 into one tenth of
      one
      percent (0.1%) of the total number of shares of Common Stock issued and
      outstanding on June 30, 2009, calculated on a fully diluted basis after giving
      effect to the conversion of such share(s) of Series D Preferred Stock. The
      shares of Common Stock received upon conversion shall be fully paid and
      non-assessable shares of Common Stock. Due to the change in control of the
      Company, Mr. Connolly and his spouse may not convert debentures that would
      result in ownership of more than 4.99% of the Company at the time of
      conversion.





The
      Series B and D Convertible Preferred Stockholders and the holders of the common
      stock vote together and the Preferred Stock shall be counted on an "as
      converted" basis, thereby giving the Preferred Shareholders control of the
      Company.





On
      May
      31, 2006, we filed an S-8 with the Securities and Exchange Commission for the
      Emerge Capital Corp. 2005 Stock Incentive Plan (the “Plan”). The document was
      submitted to register 10,000,000 shares of common stock. The purpose of the
      Plan
      is to promote the long-term growth and profitability of the Company by (a)
      providing key people with incentives to improve shareholder value and to
      contribute to the growth and financial success of the Company, and (b)
      enabling the Company to attract, retain and reward the best-available persons.
      This document is herein incorporated by reference. As of December 31, 2007
      there
      were 7,250,000 shares available under the Plan.





On
      September 30, 2006, we completed a stock purchase agreement (the “Agreement”)
      with Kipling Holdings, Inc. (“Kipling”) and Timothy J. Connolly, to acquire 100%
      of the total issued and outstanding capital stock of Kipling Holdings, Inc.
      (“Kipling”), a Delaware corporation. Kipling holds a limited partnership
      interest in a hotel in West Palm Beach, Florida.





On
      December 5, 2007 (the “ Closing
      Date ”),
      the
      Company filed on Form 8-K Current Report, as amended on December 14, 2007 and
      February 20, 2008, disclosing that the Company entered into a Stock Purchase
      Agreement (the “ Purchase
      Agreement ”)
      with
      Mr. Timothy J. Connolly, an individual and Viewpoint Capital, LLC, a Nevada
      limited liability company (the “ Investor ”)
      pursuant to which the Company issued to the Investor one (1) share of the
      Company’s Series E convertible preferred stock, par value $0.01 per share
      (“ Series
      E Preferred ”),
      which
      such Series E Preferred is convertible into Three Hundred Million Shares
      (300,000,000) of common stock of the Company, par value $0.001 per share
      (“ Common
      Stock ”)
      in
      exchange for the transfer by the Investor to the Company of Four Million
      (4,000,000) unrestricted, free-trading shares of common stock of Asset Capital
      Group, Inc., a Nevada corporation (“ ACGU
      Common Stock ”)
      having
      a value of Three Million Four Hundred Thousand Dollars ($3,400,000) based on
      the
      closing price of ACGU Common Stock as of the Closing Date as reported on the
      Pink Sheets, LLC. ACGU Common Stock trades under the symbol “ACGU.PK”. As a
      result of this transaction, the Investor acquired a 63.66% controlling interest
      in the Company’s Common Stock by virtue of the Investor’s ownership of the
      Series E Preferred.


F-9


On
      February 13, 2008, the Investor delivered to the Company a notice to convert
      the
      one (1) shares of Series E Preferred to Three Hundred Million (300,000,000)
      shares of Common Stock. On February 14, 2008, the Company issued to the Investor
      Three Hundred Million (300,000,000) shares of Common Stock, all of which are
      restricted, and canceled the One (1) share of Series E Preferred. As a result
      of
      this transaction, the Investor acquired a 63.66% controlling interest in the
      Common Stock of the Company.





During
      the month of March 2008, we sold our investment in stock of ACGU for
      approximately $7,700. Consequently, our investment in marketable securities
      as
      of December 2007 includes the net realizable value of these securities sold
      in
      March 2008.





Effective
      as of the Closing Date, Mr. Connolly resigned as Vice Chairman of the Board
      and
      as President and Chief Executive Officer of the Company, however Mr. Connolly
      shall continue to serve as President and Chief Executive Officer of Corporate
      Strategies, Inc., a Texas corporation and wholly-owned subsidiary of the Company
      (“ CSI ”)
      with
      the understanding that the business of CSI will be discontinued or spun off
      to
      its stockholders. In addition, Mr. Connolly shall continue to receive the same
      compensation as he has received through the Closing Date for his aforementioned
      continued services to CSI through December 31, 2008, which such date may be
      extended by mutual agreement by and among the parties to the Purchase Agreement.





Furthermore,
      Mr. Connolly (and his spouse) agreed on the Closing Date to relinquish certain
      non-dilutive rights in favor of Mr. Connolly (and his spouse) contained in
      Seven
      Hundred (700) shares of Series D convertible preferred stock held by Mr.
      Connolly (and his spouse) effective June 30, 2009 (instead of the previous
      date
      of December 31, 2010) in exchange for the Company conveying all rights to the
      names “Turnaround Partners, Inc.”, “Corporate Strategies, Inc.” and “Kipling
      Holdings, Inc.”, as well as all title to all furniture and equipment in the
      Houston office of the Company. The parties to the Purchase Agreement also agreed
      that the names of these companies shall be changed within sixty (60) days
      following the Closing Date.





As
      disclosed in the Form 8-K Current Report referred to above, the Company
      disclosed that effective as of December 27, 2007, the Board of Directors of
      the
      Registrant (the “ Board ”)
      accepted the resignation of (a) Wm. Chris Mathers from his position as Chief
      Financial Officer of the Registrant and (b) Fred Zeidman from his position
      as a
      member of the Board. Mr. Russell Kidder, the Registrant’s current President,
      Chief Executive Officer and member of the Board, shall serve as interim Chief
      Financial Officer, effective as of December 27, 2007.





In
      connection with the Purchase Agreement, Mr. Russell Kidder was appointed to
      serve as President, Chief Executive Officer and as a Director of the Company
      effective as of the Closing Date.




As
      filed
      on Form 8-K Current Report on January 3, 2008, the Company disclosed that
      effective as of December 31, 2007, Corporate Strategies, Inc. (“ CSI ”),
      a
      Texas corporation and wholly-owned subsidiary of Turnaround Partners, Inc.,
      a
      Nevada corporation entered into a Purchase Agreement with Natural Nutrition,
      Inc., a Nevada corporation (“ NN ”)
      and
      CSI Business Finance, Inc., a Texas corporation and wholly-owned subsidiary
      of
      NN (together with NN, the “ Buyer ”)
      pursuant to which CSI conveyed, transferred and assigned to the Buyer all of
      its
      title to and rights in CSI’s ten percent (10%) interest in the total issued and
      outstanding capital stock of Interactive Nutrition International, Inc. (“INII”),
      a company organized under the laws of Canada in exchange for the conveyance,
      transfer and assignment to CSI by the Buyer of certain Notes held by the Buyer
      (as such term is defined in the Agreement) plus a cash payment equal to One
      Hundred Ninety-Eight Thousand Eight Hundred Ninety-Nine Dollars and Ten Cents
      ($198,899.10). In addition, NN assumed payment for all of CSI’s office lease,
      equipment payments and any other payments related to the office space in
      Houston, Texas for the remainder of the lease term and any renewals.





NATURE
      OF
      OPERATIONS AND ORGANIZATION





The
      discussion below regarding the nature of operations and organization assumes
      the
      Company will continue with the current business plan, however in light of the
      Company’s change in control of ownership, the Company is contemplating a new
      business model. Currently, the Company believes the new business plan going
      forward is to focus on alternative and clean technologies.


F-10


The
      Company is an established provider of restructuring strategies, turnaround
      execution and business development services for emerging and re-emerging public
      companies. The Company markets its services to public companies, hedge funds,
      institutional investors and banks that have significant exposure in troubled
      micro-cap public companies. These companies are typically either in operational
      or financial difficulty and may be in default of lending or equity agreements,
      and as a result, they may be facing bankruptcy or liquidation if their
      operations are not turned around. Under
      our
      consulting agreements, we do not take positions in securities of our clients
      that at any one time would cause us to have an ownership interest in them of
      over 4.99%.





The
      Company is generally compensated with a combination of cash payments on a
      monthly or quarterly basis, and outright grants of equity in the form of common
      stock and/or warrants for purchasing common stock. We believe this compensation
      plan aligns our interests with the client company's shareholders because our
      ultimate compensation is maximized by successfully increasing shareholder value.
      This performance based compensation arrangement clearly demonstrates that our
      interests are consistent with both our clients and their
      shareholders.





The
      Company minimizes risk from our restructuring/turnaround clients by implementing
      the following policies:





·
            The
                Company will not assume the financial obligations of the client company
                in
                any circumstance. In most cases, the financial institution with the
                greatest risk has referred the Company to the
                transaction.





·
            The
                Company requires the client or their investor to provide the client
                company with working capital necessary to execute the turnaround
                plan.





·
            The
                Company requires the client to fully indemnify the Company against
                any
                actions, with the exception of gross negligence or
                malfeasance.





·
            If
                the client has officer and director insurance, we require the client
                to
                add the Company or any of the Company's contractors as insured parties
                under the policy.





·
            Should
                the Company consider altering any of the policies above, it will
                require a
                vote of our Board of Directors to waive them and agree to the maximum
                amount of risk that the Company will
                assume.





The
      Company also actively trades securities and options with available cash. Many
      of
      these transactions contain a considerable amount of risk.





Lehigh
      Acquisition Corp. ("Lehigh") was a subsidiary of NuWave and is treated as if
      it
      was acquired August 31, 2005, the date of the merger. Lehigh was sold on
      February 3, 2006. These financial statements include the operations of Lehigh
      through February 3, 2006 as discontinued operations.





CONSOLIDATION
      AND PRESENTATION





The
      accompanying consolidated financial statements include the accounts of the
      Company and its subsidiaries. All significant inter-company balances and
      transactions have been eliminated.





NOTE
      2
      -SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES





REVENUE
      RECOGNITION





The
      Company's revenue recognition policies are in compliance with Staff Accounting
      Bulletin 104. Revenue is recognized at the date a formal arrangement exists,
      the
      price is fixed or determinable, the delivery is complete, no other significant
      obligation of the Company exists and collectibility is reasonably
      assured.





Revenues
      from sales of real estate are recorded when title is conveyed to the buyer,
      adequate cash payment has been received and there is no continued involvement.
      One of our subsidiaries holding real estate was sold in February
      2006.





Commission
      income from the brokering of loans is recognized when all of the services
      required to be performed for such revenues have been completed. Incremental
      direct costs include credit reports appraisal fees, document preparation fees,
      wire fees, filing fees, and commissions, and are included in operating expenses,
      net of reimbursements.





Discount
      income from purchased receivables represents a percentage of the purchased
      invoice. The discount percentage earned is determined by the number of days
      the
      invoice is outstanding. Management does not anticipate generating any
      significant new business in this area.


F-11


Consulting
      revenue is recognized as services are performed.





Marketable
      securities gains (losses) is both trading gains or losses and the change in
      market value of the trading securities owned by the Company, including related
      puts and calls. The Company accounts for marketable securities in accordance
      with Financial Accounting Standard 115 "Accounting for Certain Investments
      in
      Debt and Equity Securities."





USE
      OF
      ESTIMATES





The
      preparation of consolidated financial statements in conformity with generally
      accepted accounting principles requires management to make estimates and
      assumptions that affect certain reported amounts and disclosures. Accordingly,
      actual results could differ from those estimates.





CASH
      AND
      CASH EQUIVALENTS





For
      purposes of the consolidated statement of cash flows, the Company considers
      all
      short-term securities purchased with a maturity date of three months or less
      to
      be cash equivalents.





COLLECTIBILITY
      OF ACCOUNTS AND NOTES RECEIVABLE





The
      accounts and notes receivable are reviewed monthly for aging and quarterly
      credit evaluation of the customer's financial condition to determine
      collectibility. Write-offs or an increase in the allowance for doubtful accounts
      are made based on this evaluation. The allowance for doubtful accounts was
      approximately $482,686 for the year ended December 31, 2007.





FIXED
      ASSETS





Fixed
      assets are stated at cost. Depreciation is computed using the straight-line
      method over estimated useful lives of three to five years. Leasehold
      improvements are amortized on a straight-line basis over the shorter of the
      useful life of the improvement or the term of the lease.





When
      assets are retired or otherwise disposed of, the cost and related accumulated
      depreciation are removed from the accounts, and any resulting gain or loss
      is
      recognized in operations for the period. The cost of maintenance and repairs
      is
      charged to expense as incurred; significant renewals and betterments are
      capitalized.





The
      Company did not have any fixed assets as of December 31, 2007. As part of the
      December 2007 transaction with ACGU, title to all furniture and equipment in
      the
      Houston office of the Company was conveyed to the ex-Vice Chairman of the Board
      of Directors and ex-CEO, Tim Connolly.





LAND
      HELD
      FOR DEVELOPMENT AND SALE





Land
      held
      for development and sale is stated at the seller's historical cost basis, plus
      the costs of improvements. The subsidiary holding the land was sold in February
      2006.





IMPAIRMENT
      OF LONG-LIVED ASSETS





The
      Company periodically assesses the recoverability of long-lived assets, including
      property and equipment, and the investment in the real estate partnership,
      when
      there are indications of potential impairment, based on estimates of
      undiscounted future cash flows. The amount of impairment is calculated by
      comparing anticipated discounted future cash flows with the carrying value
      of
      the related asset. In performing this analysis, management considers such
      factors as current results, trends, and future prospects, in addition to other
      economic factors.





For
      the
      2007 Period, we recorded an operating loss and impairment on our investment
      in
      the West Palm Beach hotel within Kipling Holdings, Inc. in the amount of
      $685,136. Included in this amount is $540,000 for impairment of long-lived
      asset. During the fourth quarter of 2007 there was a proposed sale of the hotel
      that would have resulted in a loss to the Company of approximately $540.000.
      The
      sale of the hotel did not occur, but the asset was written down to estimated
      net
      realizable value nevertheless. The business segment affected is our “Hotel
      Investment” as found in Footnote 20 of the consolidated financial
      statements.





DERIVATIVE
      FINANCIAL INSTRUMENTS





Derivatives
      are accounted for in accordance with SFAS 133 and EITF No. 00-19, "Accounting
      for Derivative Financial Instruments Indexed to, and Potentially Settled in,
      a
      Company's Own Stock.


F-12




FAIR
      VALUE DISCLOSURE AT DECEMBER 31, 2007





The
      carrying value of cash, notes and accounts receivable, accounts payable, accrued
      liabilities and notes payable are reasonable estimates of their fair value
      because of short-term maturity.





INCOME
      TAXES





The
      Company accounts for income taxes under SFAS No. 109, "Accounting for Income
      Taxes," which requires an asset and liability approach to financial accounting
      and reporting for income taxes. The difference between the financial statement
      and tax basis of assets and liabilities is determined annually. Deferred tax
      assets and liabilities are computed for those differences that have future
      tax
      consequences using the currently enacted tax laws and rates that apply to the
      periods in which they are expected to affect taxable income. Valuation
      allowances are established, if necessary, to reduce the deferred tax asset
      to
      the amount that will assure full realization. Income tax expense is the current
      tax payable or refundable for the period plus or minus the net change in
      the


deferred
      tax assets and liabilities.





ADVERTISING





Advertising
      costs are expensed as incurred. Advertising expense on continuing operations
      was
      $69,455 and $120,155 for the years ended December 31, 2007 and 2006,
      respectively.





NET
      INCOME (LOSS) PER SHARE





Basic
      income (loss) per share is computed by dividing the net income (loss) available
      to common shareholders by the weighted average of common shares outstanding
      during the year. Diluted per share amounts assume the conversion, exercise,
      or
      issuance of all potential common stock instruments unless the effect is
      anti-dilutive, thereby reducing the loss or increasing the income per
      share.


F-13


RECENT
      ACCOUNTING PRONOUNCEMENTS





In
      June
      2006, the Financial Accounting Standards Board (“ FASB ”)
      issued
      FASB Interpretation No. 48, *“Accounting
      for Uncertainty in Income Taxes”* (“ FIN 48 ”) *.* FIN 48 clarifies the application of SFAS No. 109, *Accounting
      for Income Taxes* ,
      by
      establishing a threshold condition that a tax position must meet for any part
      of
      the benefit of that position to be recognized in the financial statements.
      In
      addition to recognition, FIN 48 provides guidance concerning measurement,
      derecognition, classification and disclosure of tax positions. FIN 48 is
      effective for fiscal years beginning after December 15, 2006; accordingly,
      the Company adopted FIN 48 effective as of January 1, 2007. The
      adoption of FIN 48 did not have a material impact on its effective tax
      rate.




In
      September 2006, the SEC staff issued Staff Accounting Bulletin (“ SAB ”)
      No. 108, *Considering
      the Effects of Prior Year Misstatements when Quantifying Misstatements in
      Current Year Financial Statements.* SAB 108
      provides guidance on how the effects of the carryover or reversal of prior
      year
      misstatements should be considered in quantifying a current year misstatement.
      SAB 108 established a dual approach that requires quantification of errors
      under two methods: (1) roll-over method which quantifies the amount by
      which the current year income statement is misstated, and (2) the iron
      curtain method which quantifies the error as the cumulative amount by which
      the
      current year balance sheet is misstated. In some situations, companies will
      be
      required to record errors that occurred in prior years even though those errors
      were immaterial for each year in which they arose. Companies may choose to
      either restate all previously presented financial statements or record the
      cumulative effect of such errors as an adjustment to retained earnings at the
      beginning of the period in which SAB 108 is applied. SAB 108 is
      effective for fiscal years ending after November 15, 2006. The adoption of
      this pronouncement did not have an impact on the Company’s financial position or
      results of operations.




In
      September 2006, the FASB issued SFAS No. 157, *Fair
      Value Measurements* (“ SFAS
      No. 157 ”).
      This
      statement defines fair value, establishes a framework for measuring fair value
      in generally accepted accounting principles, and expands disclosures about
      fair
      value measurements. This statement clarifies how to measure fair value as
      permitted under other accounting pronouncements but does not require any new
      fair value measurements. SFAS No. 157 was originally effective for financial
      statements issued for fiscal years beginning after November 15, 2007, and
      interim periods within those fiscal years. On February 12, 2008, the FASB issued
      Final FASB Staff Position (“ FSP ”)
      No.
      Financial Accounting Standard (“ FAS ”)
      157-2, *Effective
      Date of FASB Statement*  *No.
      157* (“ FSP
      No. 157-2 ”).
      FSP
      No. 157-2, which was effective upon issuance, delays the effective date of
      SFAS
      No. 157 for nonfinancial assets and nonfinancial liabilities, except for items
      that are recognized or disclosed at fair value at least once a year, to fiscal
      years beginning after November 15, 2008. The Company expects to adopt FAS No.
      157 on January 1, 2008 and 2009 for financial assets and financial liabilities
      and nonfinancial assets and nonfinancial liabilities, respectively. The Company
      does not believe that the adoption of FAS No. 157 will have a material effect
      on
      the Company’s consolidated financial statements.





In
      July
      2006, the FASB issued FIN 48, which clarifies the accounting for uncertainty
      in
      tax positions. This Interpretation requires that the Company recognize in our
      financial statements, the impact of a tax position, if that position is more
      likely than not of being sustained on audit, based on the technical merits
      of
      the position. The provisions of FIN 48 are effective as of the beginning of
      our
      2007 fiscal year, with the cumulative effect of the change in accounting
      principle recorded as an adjustment to opening retained earnings. The adoption
      of FIN 48 did not have a material effect on the Company’s financial condition or
      results of operations for the year ended December 31, 2007.




In
      February 2007, the FASB issued SFAS No. 159, *The
      Fair Value Option for Financial Assets and Liabilities Including an amendment
      of
      FASB Statement No. 115* (“ SFAS
      No. 159 ”).
      SFAS
      No. 159 permits entities to choose to measure many financial instruments and
      certain other items at fair value that ** are
      not
      currently required to be measured at fair value. SFAS No. 159 also establishes
      presentation and disclosure requirements designed to facilitate ** comparisons
      between entities that choose different measurement attributes for similar types
      of assets and liabilities. SFAS No. 159 is effective as of the ** beginning
      of an entity’s first fiscal year that begins after November 15, 2007. The
      Company expects to adopt SFAS No. 159 on January 1, 2008. The Company has
      evaluated the impact of adopting SFAS No. 159 and has determined that it will
      not elect the fair value option under SFAS No.159 for any financial instruments
      that are not required to be presented at fair value under generally accepted
      accounting principles.





In
      December 2007, the FASB issued SFAS No. 160, “Noncontrolling Interests in
      Consolidated Financial Statements – an amendment of ARB No. 51”
(“ SFAS
      160 ”).
      SFAS
      160 establishes new accounting and reporting standards for the noncontrolling
      interest in a subsidiary and for the deconsolidation of a subsidiary. Before
      this statement, limited guidance existed for reporting noncontrolling interests
      (minority interest). As a result, diversity in practice exists. In some cases
      minority interest is reported as a liability and in others it is reported in
      the
      mezzanine section between liabilities and equity. Specifically, SFAS 160
      requires the recognition of a noncontrolling interest (minority interest) as
      equity in the consolidated financials statements and separate from the parent’s
      equity. The amount of net income attributable to the noncontrolling interest
      will be included in consolidated net income on the face of the income statement.
      SFAS 160 clarifies that changes in a parent’s ownership interest in a subsidiary
      that do not result in deconsolidation are equity transactions if the parent
      retains its controlling financial interest. In addition, this statement requires
      that a parent recognize gain or loss in net income when a subsidiary is
      deconsolidated. Such gain or loss will be measured using the fair value of
      the
      noncontrolling equity investment on the deconsolidation date. SFAS 160 also
      includes expanded disclosure requirements regarding the interests of the parent
      and its noncontrolling interests. SFAS 160 is effective for the Company on
      January 1, 2009. Earlier adoption is prohibited. The Company is currently
      evaluating the impact, if any, of the adoption of SFAS 160 will have on its
      consolidated financial statements.


F-14


In
      December 2007, the FASB issued SFAS No. 141R, *Business
      Combinations* .
      SFAS
      No. 141R provides companies with principles and requirements on how an acquirer
      recognizes and measures in its financial statements the identifiable assets
      acquired, liabilities assumed, and any noncontrolling interest in the acquiree
      as well as the recognition and measurement of goodwill acquired in a business
      combination. SFAS No. 141R also requires certain disclosures to enable users
      of
      the financial statements to evaluate the nature and financial effects of the
      business combination. Acquisition costs associated with the business combination
      will generally be expensed as incurred. SFAS 141R is effective for business
      combinations occurring in fiscal years beginning after December 15, 2008. Early
      adoption of SFAS No. 141R is not permitted. The Company is currently evaluating
      the impact SFAS No. 141R will have on any future business
      combinations.





NOTE
      3 – INCOME (LOSS) PER COMMON SHARE





In
      accordance with the Financial Accounting Standards Board (the “FASB”) Statement
      of Financial Accounting Standards No. 128 (“SFAS 128”), "Earnings per Share",
      basic earnings per share are computed based on the weighted average shares
      of
      common stock outstanding during the periods.  Diluted earnings per share
      are computed based on the weighted average shares of common stock plus the
      assumed issuance of common stock for all potentially dilutive
      securities.





The
      computations for basic and diluted net income (loss) per share consist of the
      following:


F-15





Years
                EndedDecember
                31,2007
            
            2006Income
                (loss) from continuing operations
            
            $
            (2,604,975
            )
            $
            1,623,356Less
                effect of derivatives, preferred stock and convertible
                debenture
            
            
            828,766
            
            
            -Adjusted
                income (loss) from continuing operations
            
            $
            (1,776,209
            )
            $
            1,623,356Income
                (loss) from discontinued operations
            
            
            -
            
            
            (4,688
            )Gain
                on sale of subsidiary
            
            
            -
            
            
            3,317,406Net
                income (loss)
            
            $
            (1,776,209
            )
            $
            4,936,074Basic
                weighted average shares
            
            
            63,733,188
            
            
            25,505,662Effect
                of dilutive securities:Series
                B preferred stock
            
            
            -
            
            
            4,195,445Series
                D preferred stock
            
            
            -
            
            
            68,710,842Diluted
                weighted average shares
            
            
            63,733,188
            
            
            98,411,949Income
                (loss) per share:Basic:Income
                (loss) from continuing operations
            
            $
            (0.04
            )
            $
            0.06Income
                (loss) from discontinued operations
            
            
            -
            
            
            0.13Net
                income (loss)
            
            $
            (0.04
            )
            $
            0.19Diluted:Income
                (loss) from continuing operations
            
            $
            -
            
            $
            0.02Income
                (loss) from discontinued operations
            
            
            -
            
            
            0.03Net
                income (loss)
            
            $
            -
            
            $
            0.05





(1)
            A
                weighted average year-to-date number of Convertible Debentures to
                convert
                into 52,502,492 and 51,383,109 shares of common stock were outstanding
                during the twelve months ended December 31, 2007 and 2006, respectively,
                but were not included in the computation of diluted per share net
                income
                (loss) for the twelve months ended December 31, 2007 or 2006 because
                they
                were anti-dilutive. In addition because they were anti-dilutive,
                4,195,445
                of Series B preferred stock and 94,665,241 of Series D preferred
                stock
                were not included in the computation of diluted income per share.
                In
                addition there were 3,000,000 warrants that were not included because
                of
                their anti-dilutive effect.


F-16


NOTE
      4 -
      CONCENTRATIONS OF CREDIT RISK AND MAJOR CUSTOMERS





Financial
      instruments, which potentially subject the Company to concentrations of credit
      risk consist principally of cash, accounts and notes receivable and marketable
      securities. The Company maintains its cash accounts in high quality FDIC insured
      banks in Texas and in money market brokerage accounts. The Company's accounts
      receivables consist of receivables for consulting from companies located in
      the
      United States. The Company performs ongoing credit evaluations of its customers'
      financial conditions to ensure collections and minimize losses. The Company
      reduces its credit risk relating to marketable securities through
      diversification of marketable securities held. See Note 7 – Investment in
      Marketable Securities for risks associated with a short-term investment in
      auction rate securities.





For
      the
      years ended December 31, 2007 and 2006, the Company had sales as a percent
      of
      annual revenues from continuing operations from the following
      customers:





2007
            
            2006Customer
                A
            
            
            63
            %
            
            0
            %Customer
                B
            
            
            9
            %
            
            31
            %Customer
                C
            
            
            0
            %
            
            25
            %Customer
                D
            
            
            9
            %
            
            19
            %Customer
                E
            
            
            19
            %
            
            0
            %





No
      other
      customers accounted for more than 10% of revenue during the year.





NOTE
      5 -
      CONCENTRATION OF TRANSACTIONS WITH YA GLOBAL INVESTMENTS, LP (“YA Global”) (fka
      Cornell Capital Partners, LP).





At
      December 31, 2007, $7,826,100 of the convertible debentures are owed to YA
      Global and Highgate House Funds, Ltd., an affiliate of YA Global.





YA
      Global
      is the principal lender to the Company.





In
      February 2006, the Company sold its wholly-owned subsidiary, Lehigh, to YA
      Global for total proceeds of $5,948,407 including the assumption of $4,881,274
      promissory notes, $400,000 of convertible debentures, $573,737 of accrued
      expense and interest and cash of $93,396. The transaction resulted in a gain
      of
      $3,042,406.





NOTE
      6 -
      FIXED ASSETS





The
      Company did not have any fixed assets as of December 31, 2007. As part of the
      December 2007 transaction with ACGU, title to all furniture and equipment in
      the
      Houston office of the Company was conveyed to the ex-Vice Chairman of the Board
      of Directors and CEO, Tim Connolly.





Depreciation
      expense for the years ended December 31, 2007 and 2006 was $24,041 and $23,874,
      respectively.





NOTE
      7 -
      INVESTMENT IN MARKETABLE SECURITIES





Investments
      in marketable securities primarily include shares of common stock in various
      companies. The investments are considered trading securities, and accordingly
      any changes in market value are reflected in the consolidated statement of
      operations. At December 31, 2007 and 2006, the Company had unrealized losses
      of
      $25,353 and $158,809, respectively, related to marketable securities held on
      those dates. These unrealized gains and losses are included in the consolidated
      statements of operations for the respective years.





Investments
      include shares of common stock in companies which do not have a readily
      determinable fair market value and are accounted for using the cost method.
      Once
      a quarter, the financial statements, operations and any other information needed
      to evaluate these investments are reviewed to determine if an impairment needs
      to be recorded. At December 31, 2007, the Company had $29,852 of investment
      in
      preferred stock carried at cost.





As
      of
      December 31, 2007, $500,000 of our short-term investments was invested in
      auction rate securities, or ARSs. The $500,000 we have invested in ARSs at
      April
      28, 2008 is collateralized by portfolios of AAA municipal obligations.
 Through the date of this filing, auctions of these securities were not
      successful, resulting in our continuing to hold these securities and the issuers
      paying interest at the maximum contractual rate. Based on current market
      conditions, it is likely that auctions related to these securities will be
      unsuccessful in the near term. Unsuccessful auctions will result in our
      holding securities beyond their next scheduled auction reset dates and limiting
      the short-term liquidity of these investments. While these failures in the
      auction process have affected our ability to access these funds in the near
      term, we do not believe that the underlying securities or collateral have been
      affected. We believe that the higher reset rates on failed auctions provide
      sufficient incentive for the security issuers to address this lack of liquidity.
      If the credit rating of the security issuers deteriorates, we may be
      required to adjust the carrying value of these investments through an impairment
      charge.


F-17


NOTE
      8 – ACQUISITION OF KIPLING HOLDINGS, INC.





On
      September 30, 2006, we completed a stock purchase agreement (the “Agreement”) to
      acquire 100% of the total issued and outstanding capital stock of Kipling
      Holdings, Inc. (“Kipling”), a Delaware corporation from Timothy J. Connolly in
      consideration of (a) our assumption of all of the liabilities of Kipling,
      subject to certain consents, (b) certain anti-dilution rights as set forth
      in
      the Agreement and (c) all legal and other costs and expenses incurred by Kipling
      in consideration with this Agreement. Mr. Connolly serves as CEO of Turnaround
      and therefore (i) Turnaround obtained a third party appraisal of the Company
      which valued the required asset at Two Million Two Hundred Fifty Thousand
      Dollars ($2,250,000) more than the liabilities assumed and (ii)
      Turnaround’s other (disinterested) Board member and CFO reviewed and approved
      this affiliate transaction. Mr. Connolly received no profit from this
      affiliated transaction. Because this transaction was between parties under
      common control, we recorded the $3,313,264 of consideration in excess of Mr.
      Connolly’s original cost basis as a deemed distribution to Mr. Connolly. The
      Agreement had been subject to the written consent of Highgate House Funds,
      Ltd.
      (“ Highgate ”),
      which
      the Company and Highgate reduced to writing effective as of September 30, 2006.
      Kipling primarily provides capital for investments in the hospitality industry.
      Kipling, at December 31, 2007, owned a thirty percent interest in a Hilton
      hotel
      under construction in West Palm Beach, Florida. Since the purchase was effective
      on September 30, 2006 the Company did not record any revenue or expenses during
      the nine months ended September 30, 2006. The loss for the period, October
      1
      through December 31, 2006, and for the entire year ended December 31, 2007
      had
      been included in the statement of operations.





In
      a
      separate agreement with an individual, the Company issued an additional
      2,000,000 shares and 3,000,000 warrants ($0.05 per warrant) in consideration
      of
      the individual’s surrender of his option, rights or other interests whatsoever
      to purchase any capital stock of Kipling Holdings, Inc. The Company has valued
      these 2,000,000 shares at $140,000. The Company used the closing price of $0.07
      per share on September 30, 2006, the date of contract execution, as the value
      assigned to these shares. This expense is included as merger expense for the
      twelve months ended December 31, 2006. The Company has valued the 3,000,000
      warrants in the amount of $141,000 using the Black Sholes method and is
      amortized over the term of the agreement.





Assets
      and liabilities acquired in the acquisition





The
      Company has a thirty percent limited partnership interest in Worthington
      Hospitality, L.L.L.P. (Worthington) totaling $3,720,007. The initial investment
      of $4,500,000 was funded on December 7, 2005. The partnership currently has
      a
      Hilton hotel, which became operational in February 2007, in West Palm Beach,
      Florida. The partnership agreement provides for a preferential return of seven
      percent per annum on the capital contributions funded by the investors until
      such time as the hotel/partnership secures a temporary or permanent certificate
      of occupancy, at which time the preferential return shall cease to accrue.
      As of
      December 31, 2007, the $4,500,000 Investment in Worthington has been reduced
      by
      $481,250 for the preferential return and distributions of capital, cumulative
      partnership income and loses and a $540,000 impairment through December 31,
      2007. The Company receives thirty percent of any monetary amounts paid out
      by
      the partnership and will be allocated thirty percent of all operating profits,
      non-operating profits and losses of the partnership. This investment is
      accounted for using the equity method.





Worthington
      started its operations September 14, 2005. At December 31, 2007 Worthington
      had
      a book value of $2,648,223 consisting of cash, land, building, furniture and
      fixtures, equipment and other assets of $12,199,936 and accounts payable and
      debt of $9,551,713. The difference between the book value of the investment
      and
      the underlying equity in the net assets per the partnership at the date of
      completion of the hotel in the amount of $2,694,557 is being depreciated over
      25
      years which is the same as the depreciable life of the building.





The
      general partner has exclusive responsibility for management of the partnership
      including the power to sell the hotel and land. Limited partners have no right
      or authority to conduct partnership business. The partnership agreement provides
      that, without the unanimous consent of the limited partners, the general partner
      cannot transfer less than 100% of the partnership interests. If the general
      partner decides to transfer 100% of the partnership interest in an
“arm’s-length” transaction, he may require all of the partners to transfer all
      of their respective interest. Limited partners are not responsible for the
      expenses, liabilities or obligations of the partnership except as expressly
      assumed or guaranteed.


F-18


Debenture
      Payable from the acquisition





The
      Company is the issuer of a $6,225,000 Secured Convertible Debenture (“the
      Debenture”) payable to Highgate House Funds, Ltd (“Holder”), dated December 2,
      2005. The Debenture bears interest at the rate of 7%, which is accrued until
      maturity. The Debenture is due and payable in full, including accrued interest
      from inception, on December 1, 2010. Associated deferred debenture costs in
      the
      amount of $43,725, net of $18,219 amortization as of December 31, 2007, has
      been
      recorded as a non-current asset.





The
      Debenture is convertible, at the option of the Holder, into common stock of
      the
      Company at a price per share equal to the lower of (i) $.50 (the “Fixed Price”)
      or (ii) eighty percent (80%) of the lowest closing bid price for the five (5)
      trading days immediately preceding the date of conversion or, if a special
      event
      of default occurs, at a price per share equal to eighty percent (80%) of the
      lowest closing bid price for the thirty (30) trading days immediately preceding
      the date of conversion. The shares of common stock issuable by the Company
      to
      the investor upon conversion of shares of the Debentures will not be registered
      initially under the Securities Act of 1933. The Company is obligated to register
      the resale of the conversion shares under the Securities and Exchange Act,
      pursuant to the terms of the Investor Registration Rights Agreement dated
      December 2, 2005. The Registration Rights Agreement called for the Company
      to
      register the underlying securities no later than 180 after the execution of
      the
      Debenture agreement (this requirement has been extended to June 30, 2008) and
      use its best efforts to have the Initial Registration statement declared
      effective by the SEC no later than ninety days after the date
      filed.





Per
      the
      original agreement, in the event the Registration Statement is not filed by
      December 6, 2006 or is not declared effective within ninety days of the filing
      date, the Company will pay liquidated damages, to the Holder, a cash amount
      equal to two percent per month of the outstanding principal amount of the
      Debenture outstanding. The holder had verbally agreed to extend the registration
      filing requirement date to June 30, 2008. The requirement under the Registration
      Rights Agreement for this debenture has now been verbally waived.





The
      debenture is secured by all of the assets and property of the Company including
      the investment in Worthington.





The
      following unaudited pro forma financial information presents the consolidated
      results of operations for the twelve months ended December 31, 2006, as if
      the
      acquisition had occurred on January 1, 2006, after giving effect to certain
      adjustments. The pro forma information does not necessarily reflect the results
      of operations that would have occurred had the entities been a single company
      during this period. Kipling was not in existence for the period ending December
      31, 2005.




December
                31, 2006(unaudited)Net
                sales
            
            $
            1,127,219Net
                income (loss)
            
            $
            1,591,354Weighted
                average number of common shares outstanding – basic
            
            
            25,505,662Weighted
                average number of common shares outstanding – diluted
            
            
            98,411,949Income
                per common share – basic
            
            $
            0.19Income
                per common share – diluted
            
            $
            0.05




NOTE
      9 -
      NOTES PAYABLE





On
      November 20, 2002, the Company obtained an unsecured revolving line of credit
      of
      $100,000 at prime plus 2% with an open maturity date. At December 31, 2007,
      the
      prime rate was 7.50% and amount borrowed was $48,936. At December 31, 2007,
      all
      payments under the terms of the note were current.





NOTE
      10
      -CONVERTIBLE DEBENTURES - DERIVATIVE FINANCIAL INSTRUMENTS





The
      Convertible Debentures issued from 2003 through 2007 have been accounted for
      in
      accordance with SFAS 133 and EITF No. 00-19, "Accounting for Derivative
      Financial Instruments Indexed to, and Potentially Settled in, a Company's Own
      Stock."


F-19


The
      Company has identified the following instruments have derivatives requiring
      evaluation and accounting under the relevant guidance applicable to financial
      derivatives:





YA
      Global
      Debenture issued 5/6/04 in the face amount of $400,000


YA
      Global
      Debenture issued 6/24/04 in the face amount of $500,000


YA
      Global
      Debenture issued 9/28/04 in the face amount of $400,000


YA
      Global
      Debenture issued 4/6/05 in the faceamount of $400,000


Holland
      et. al. Debentures issued 12/22/03 in the face amount of$250,000


Saporito
      Debenture issued 1/29/04 in the face amount of $100,000


Viola
        Debenture issued 10/12/04 in the face amount of $100,000


Highgate
      House issued 12/02/05 in the face amount of $6,225,000





The
      Company has identified the above debentures have embedded derivatives. These
      embedded derivatives have been bifurcated from their respective host debt
      contracts and accounted for as derivative liabilities in accordance with EITF
      00-19. When multiple derivatives exist within the Convertible Notes, they have
      been bundled together as a single hybrid compound instrument in accordance
      with
      SFAS No. 133 Derivatives Implementation Group Implementation Issue No. B-15,
      "Embedded Derivatives: Separate Accounting for Multiple Derivative Features
      Embedded in a Single Hybrid Instrument."





The
      embedded derivatives within the Convertible Notes have been recorded at fair
      value at the date of issuance; and are marked-to-market each reporting period
      with changes in fair value recorded to the Company's income statement as "Net
      change in fair value of derivative liabilities." The Company has utilized a
      third party valuation firm to fair value the embedded derivatives using a
      layered discounted probability-weighted cash flow approach.





The
      fair
      value of the derivative liabilities are subject to the changes in the trading
      value of the Company's common stock, as well as other factors. As a result,
      the
      Company's financial statements may fluctuate from quarter-to-quarter based
      on
      factors, such as the price of the Company's stock at the balance sheet date
      and
      the amount of shares converted by note holders. Consequently, our financial
      position and results of operations may vary from quarter-to-quarter based on
      conditions other than our operating revenues and expenses.





YA
      GLOBAL
      5/06/04 CONVERTIBLE DEBENTURE





On
      May 6,
      2004, Corporate Strategies entered into a Secured Debenture agreement with
      YA
      Global, pursuant to which the Company sold $400,000 of convertible notes due
      May
      5, 2007.





The
      notes
      bear interest at 5%, which is accrued until maturity on May 5, 2007. The notes
      are convertible, at the option of the holders, into common stock of the Company
      at a price of $0.18 per share, subject to standard anti-dilution provisions
      relating to splits, reverse splits and other transactions plus a reset provision
      whereby the conversion price may be adjusted downward to a lower price per
      share
      based on 80% of the lowest closing bid price for the five trading days prior
      to
      conversion. The Holder has the right to cause the notes to be converted into
      common stock, subject to an ownership limitation of 4.99% of the outstanding
      stock. The Company has the right to repurchase the Notes at 120% of the face
      amount. The conversion feature, reset provision and the Company's optional
      early
      redemption right have been bundled together as a single compound embedded
      derivative liability, and fair valued using a layered discounted
      probability-weighted cash flow approach.


F-20


YA
      GLOBAL
      6/24/04 CONVERTIBLE DEBENTURE





On
      June
      24, 2004, Corporate Strategies entered into a Secured Debenture agreement with
      I-Voice, pursuant to which the Company sold $500,000 of convertible notes due
      May 1, 2007. The notes were subsequently assigned to YA Global.





The
      notes
      bear interest at 5%, which is accrued until maturity on May 1, 2007. The notes
      are convertible, at the option of the holders, into common stock of the Company
      at a price of $0.114 per share, subject to standard anti-dilution provisions
      relating to splits, reverse splits and other transactions plus a reset provision
      whereby the conversion price may be adjusted downward to a lower price per
      share
      based on 80% of the lowest closing bid price for the five trading days prior
      to
      conversion. The Holder has the right to cause the notes to be converted into
      common stock, subject to an ownership limitation of 4.99% of the outstanding
      stock. The Company has the right to repurchase the Notes at 120% of the face
      amount. The conversion feature, reset provision and the Company's optional
      early
      redemption right have been bundled together as a single compound embedded
      derivative liability, and fair value using a layered discounted
      probability-weighted cash flow approach.





YA
      GLOBAL
      9/28/04 CONVERTIBLE DEBENTURE





On
      September 28, 2004, Corporate Strategies entered into a Secured Debenture
      agreement with YA GLobal., pursuant to which the Company sold $400,000 of
      convertible notes due September 28, 2007.





The
      notes
      bear interest at 5%, which is accrued until maturity on September 28, 2007.
      The
      notes are convertible, at the option of the holders, into common stock of the
      Company at a price of $0.084 per share, subject to standard anti-dilution
      provisions relating to splits, reverse splits and other transactions plus a
      reset provision whereby the conversion price may be adjusted downward to a
      lower
      price per share based on 80% of the lowest closing bid price for the five
      trading days prior to conversion. The Holder has the right to cause the notes
      to
      be converted into common stock, subject to an ownership limitation of 4.99%
      of
      the outstanding stock. The Company has the right to repurchase the Notes at
      120%
      of the face amount. The conversion feature, reset provision and the Company's
      optional early redemption right have been bundled together as a single compound
      embedded derivative liability, and fair valued using a layered discounted
      probability-weighted cash flow approach.





YA
      GLOBAL
      4/06/05 CONVERTIBLE DEBENTURE





On
      April
      6, 2005, Corporate Strategies entered into a Secured Debenture agreement with
      YA
      Global, pursuant to which the Company sold $400,000 of convertible notes due
      April 6, 2008.





The
      notes
      bear interest at 5%, which is accrued until maturity on April 6, 2008. The
      notes
      are convertible, at the option of the holders, into common stock of the Company
      at a price of $0.108 per share, subject to standard anti-dilution provisions
      relating to splits, reverse splits and other transactions plus a reset provision
      whereby the conversion price may be adjusted downward to a lower price per
      share
      based on 80% of the lowest closing bid price for the five trading days prior
      to
      conversion. The Holder has the right to cause the notes to be converted into
      common stock, subject to an ownership limitation of 4.99% of the outstanding
      stock. The Company has the right to repurchase the Notes at 120% of the face
      amount. The conversion feature, reset provision and the Company's optional
      early
      redemption right have been bundled together as a single compound embedded
      derivative liability, and fair valued using a layered discounted
      probability-weighted cash flow approach.


F-21


HOLLAND
      ET. AL. 12/22/03 SECURED CONVERTIBLE NOTES





On
      December 22, 2003, NuWave entered into a Secured Debenture agreement with two
      investors (Holland et. al) pursuant to which Nuwave sold $250,000 of convertible
      notes due December 22, 2005.





The
      notes
      bear interest at 5%, which is accrued until maturity on December 22, 2005.
      The
      notes are convertible, at the option of the holders, into common stock of the
      Company at a price of $0.168 per share, subject to standard anti-dilution
      provisions relating to splits, reverse splits and other transactions plus a
      reset provision whereby the conversion price may be adjusted downward to a
      lower
      price per share based on 80% of the lowest daily volume weighted average price
      ("VWAP") for the five trading days prior to conversion. The Holder has the
      right
      to cause the notes to be converted into common stock. The Company has the right
      to repurchase the Notes at 110% of the face amount. The notes are unsecured
      general obligations of the Company and are subordinated to all other
      indebtedness of the Company unless the other indebtedness is expressly made
      subordinate to the notes. The notes were acquired by the Company effective
      August 31, 2005 as part of the reverse merger between NuWave and Corporate
      Strategies The notes were amended on November 30, 2005 to defer the maturity
      date to January 31, 2007 and were further amended on January 23, 2007 to defer
      the maturity date to June 30, 2007. The conversion feature, reset provision
      and
      the Company's optional early redemption right have been bundled together as
      a
      single compound embedded derivative liability, and valued using a layered
      discounted probability-weighted cash flow approach. The modification was
      determined to be substantial and the Company accounted for the modification
      as
      an extinguishment of debt under EITF 96-19, and recorded the replacement note.
      The single compound embedded derivative liability was valued using the same
      methodology for the replacement note.





SAPORITO
      CONVERTIBLE DEBENTURE





On
      January 29, 2004, NuWave entered into a Secured Debenture agreement with Joanna
      Saporito pursuant to which NuWave sold $100,000 of convertible notes due January
      29, 2006.





The
      notes
      bear interest at 5%, which is accrued until maturity on January 29, 2006. The
      notes are convertible, at the option of the holders, into common stock of the
      Company at a price of $0.156 per share, subject to standard anti-dilution
      provisions relating to splits, reverse splits and other transactions plus a
      reset provision whereby the conversion price may be adjusted downward to a
      lower
      price per share based on 80% of the lowest daily volume weighted average price
      ("VWAP") for the five trading days prior to conversion. The Holder has the
      right
      to cause the notes to be converted into common stock. The Company has the right
      to repurchase the Notes at 110% of the face amount. The notes are unsecured
      general obligations of the Company and are subordinated to all other
      indebtedness of the Company unless the other indebtedness is expressly made
      subordinate to the notes. The notes were acquired by the Company effective
      August 31, 2005 as part of the reverse merger between NuWave Technologies and
      Corporate Strategies. The notes were amended on November 30, 2005 to defer
      the
      maturity date to January 31, 2007 and were further amended on January 23, 2007
      to defer the maturity date to June 30, 2007. The conversion feature, reset
      provision and the Company's optional early redemption right have been bundled
      together as a single compound embedded derivative liability, and fair valued
      using a layered discounted probability-weighted cash flow approach. The
      modification was determined to be substantial and the Company accounted for
      the
      modification as an extinguishment of debt under EITF 96-19, and recorded the
      replacement note. The single compound embedded derivative liability was valued
      using the same methodology .


F-22


VIOLA
      CONVERTIBLE DEBENTURE





On
      October 12, 2004, NuWave Technologies entered into a Secured Debenture agreement
      with Mary-Ellen Viola pursuant to which NuWave sold $100,000 of convertible
      notes due October 12, 2006.





The
      notes
      bear interest at 5%, which is accrued until maturity on October 12, 2006. The
      notes are convertible, at the option of the holders, into common stock of the
      Company at a price of $0.078 per share, subject to standard anti-dilution
      provisions relating to splits, reverse splits and other transactions plus a
      reset provision whereby the conversion price may be adjusted downward to a
      lower
      price per share based on 80% of the lowest closing bid price for the five
      trading days prior to conversion. The Holder has the right to cause the notes
      to
      be converted into common stock, subject to an ownership limitation of 9.99%
      of
      the outstanding stock. The Company has the right to repurchase the Notes at
      110%
      of the face amount. The notes were acquired by the Company effective August
      31,
      2005 as part of the reverse merger between NuWave and Corporate Strategies.
      The
      notes were amended on January 23, 2007 to defer the maturity date to June 30,
      2007. The conversion feature, reset provision and the Company's optional early
      redemption right have been bundled together as a single compound embedded
      derivative liability, and fair valued using a layered discounted
      probability-weighted cash flow approach.





HIGHGATE
      HOUSE 12/02/05 CONVERTIBLE DEBENTURE





The
      Company is the issuer of a $6,225,000 Secured Convertible Debenture (“the
      Debenture”) payable to Highgate House Funds, Ltd (“Holder”), dated December 2,
      2005. The Debenture bears interest at the rate of 7%, which is accrued until
      maturity. The Debenture is due and payable in full, including accrued interest
      from inception, on December 1, 2010.





The
      Debenture is convertible, at the option of the Holder, into common stock of
      the
      Company at a price per share equal to the lower of (i) $.50 (the “Fixed Price”)
      or (ii) eighty percent (80%) of the lowest closing bid price for the five (5)
      trading days immediately preceding the date of conversion or, if a special
      event
      of default occurs, at a price per share equal to eighty percent (80%) of the
      lowest closing bid price for the thirty (30) trading days immediately preceding
      the date of conversion. The shares of common stock issuable by the Company
      to
      the investor upon conversion of shares of the Debentures will not be registered
      initially under the Securities Act of 1933. The Company is obligated to register
      the resale of the conversion shares under the Securities and Exchange Act,
      pursuant to the terms of the Investor Registration Rights Agreement dated
      December 2, 2005. The Registration Rights Agreement called for the Company
      to
      register the underlying securities no later than 180 after the execution of
      the
      Debenture agreement (this requirement has been extended to June 30, 2007) and
      use its best efforts to have the Initial Registration statement declared
      effective by the SEC no later than ninety days after the date filed. The
      conversion feature and the Company's optional early redemption right have been
      bundled together as a single compound embedded derivative liability, and fair
      valued using a layered discounted probability-weighted cash flow approach.





The
      debentures for YA Global, Holland, Saparito and Viola have been verbally
      extended to June 30, 2008. At December 31, 2007, $1,932,475 of debentures are
      classified as a current liability, however the Company can force conversion
      of
      the debentures into common stock at any time.





DERIVATIVE
      VALUATIONS





The
      fair
      value model utilized to value the various embedded derivatives in the
      convertible notes, comprises multiple probability-weighted scenarios under
      various assumptions reflecting the economics of the Convertible Debentures,
      such
      as the risk-free interest rate, expected Company stock price and volatility,
      likelihood of conversion and or redemption, and likelihood default status and
      timely registration. At inception, the fair value of this single compound
      embedded derivative was bifurcated from the host debt contract and recorded
      as a
      derivative liability which resulted in a reduction of the initial notional
      carrying amount of the Convertible Debentures (as unamortized discount which
      will be amortized over the term of the note under the effective interest
      method).


F-23


The
      following is a summary of the Convertible Debentures and the adjustments made
      based on the embedded derivatives:




Summary of Derivative Values
            
            Derivative Liabilities - Value as of:Convertible Debentures
            
            12/31/2007Holland
                et. al. Debentures issued 12/22/03
            
            $
            1,284Saporito
                Debenture issued 1/29/04
            
            
            2,045YA
                Global Debentures issued 5/6/04
            
            
            1,881YA
                Global Debentures issued 6/24/04
            
            
            3,134YA
                Global Debentures issued 9/28/04
            
            
            2,508Viola
                Debenture issued 10/12/04
            
            
            202YA
                Global Debentures issued 4/6/05
            
            
            2,504Highgate
                Debenture issued 12/2/05
            
            
            268,623Total
            
            $
            282,181




DEBT
      DISCOUNTS





For
      the
      period from inception of the Convertible Debentures through each balance sheet
      date, the amortization of unamortized discount on the Convertible Notes has
      been
      classified as interest expense in the accompanying statements of operations.
      As
      of December 31, 2007 there were no discounts associated with the Convertible
      Debentures.





Annual
      maturities of notes payable and convertible debentures at December 31, 2007
      are
      as follows :





Year
                Ending December 31,
            
            Amount2008
            
            $
            475,9762009
            
            
            50,9732010
            
            
            6,280,2042011
            
            
            4,802Total
            
            $
            6,811,955




NOTE
      11 -
      DEBT EXTINGUISHMENT





The
      Company accounts for modifications to debt instruments based on the accounting
      guidance found in EITF 96-19, Debtor's Accounting for a Modification or Exchange
      of Debt Instruments. Several of the convertible notes were modified in November,
      2005 to extend the maturity to January 31, 2007. These convertible notes were
      further modified in January, 2007 to extend the maturity to June 30, 2007.
      None
      of the debentures were extended past June 30, 2007. All debentures are
      classified as a current liability, however the Company can force conversion
      of
      the debentures into common stock at any time. In addition, two (2) convertible
      notes were extinguished as part of the proceeds for the sale of Lehigh in
      February, 2006. Upon modification, each of the convertible notes were tested
      for
      extinguishment under the guidance of EITF 96-19. The modification was determined
      to be substantial for the following notes and the Company accounted for the
      modification as an extinguishment of debt and recorded the following gains
      (losses):


F-24


Summary
      of Debt Extinguishment:





Convertible
                Note
            
            Gain
                on
            
            Extinguishment12/31/07
            
            12/31/06Holland
                et. al. Debentures issued 12/8/03
            
            $
            133,425
            
            $
            0.00Holland
                et. al. Debentures issued 12/22/03
            
            
            213,545
            
            
            0.00Saporito
                Debenture issued 1/29/04
            
            
            103,680
            
            
            0.00YA
                Global Debentures issued 5/5/05
            
            
            0.00
            
            
            36,194YA
                Global Debenture issued 7/20/05
            
            
            0.00
            
            
            58,171Viola
                Debenture issued 10/12/04
            
            
            0.00
            
            
            36,198Total
            
            $
            450,650
            
            $
            130,563





NOTE
      12 -
      DESCRIPTION OF CAPITAL STOCK





The
        current authorized capital stock of the Company consists of Five Billion
        (5,000,000,000) shares of Common Stock, par value $0.001 per share, Four
        Hundred
        Thousand (400,000) shares of Series A convertible preferred, par value $.01
        per
        share, One Hundred Thousand (100,000) shares each of convertible Series B
        and D
        Preferred, par value $0.01 per share, One Thousand (1,000) non-voting shares
        of
        Series C Preferred, par value $0.01 per share and one (1) share of Series
        E
        Preferred, par value $0.001. As of December 31, 2007, 135,236,054 shares
        of
        Common Stock, six thousand six hundred and sixty-six (6,666) shares of Series
        B
        Preferred, two hundred twenty-five (225) shares of Series C Preferred, seven
        hundred (700) shares of Series D Preferred stock, and one (1) share of Series
        E
        Preferred were issued and outstanding. The following description is a
        summary of the capital stock and contains the material terms of voting capital
        stock.





Each
      share of Common Stock entitles the holder to one (1) vote on each matter
      submitted to a vote of our shareholders, including the election of Directors.
      There is no cumulative voting. Subject to preferences that may be applicable
      to
      any outstanding preferred stock, Shareholders are entitled to receive ratably
      such dividends, if any, as may be declared from time to time by the Board
      of


Directors.
      Shareholders have no preemptive, conversion or other subscription
      rights.





The
      Company is authorized to issue two million (2,000,000) shares of preferred
      stock. The holder of the Company's Series B Preferred is entitled to convert
      into 4,195,445 shares of common stock and is entitled to cast votes equal to
      these shares on all matters submitted to the shareholders. The series C
      preferred shares have no voting rights, except as required under Nevada general
      corporation law. We have
      225 shares of Series C preferred stock outstanding. The stock has a liquidation
      preference of $337,380 and is redeemable at $1,500 per share at the Company’s
      option. Dividends are cumulative and accrue at the rate of $120 per share per
      year. Under the purchase agreement dated December 5, 2007, the series C
      preferred stock was to have been paid off by December 31, 2007. Therefore,
      the
      full liquidation value of $337,380 is recorded as a current
      liability.





Pursuant
      to the purchase of our interest in Kipling Holdings, Inc. (“Kipling”) as fully
      described in Item 6, and effective September 25, 2006, the Board of Directors
      approved the designation of Series D convertible preferred stock (the “Series
      D”), par value of $0.01, to consist of up to One Hundred Thousand (100,000)
      shares. As a result of the Kipling purchase, on December 31, 2006, the Board
      of
      Directors reduced the 93,334 shares of then outstanding Series D owned by our
      CEO, Timothy J. Connolly, and his spouse to Seven Hundred (700) shares of Series
      D. The Series D ranks pari passu with the common stock of the Company on an
“as
      converted” basis, and senior to the Company’s Series A, B and C preferred stock.
      The holders of the Series D are entitled to receive dividends or distributions
      on a pro rata basis when and if dividends are declared on our Common Stock,
      but
      with no liquidation preference. Each share of the Series D may be convertible,
      at the option of the holder, at any time and from time to time after December
      31, 2006 through June 30, 2009, into that number of shares of Common Stock
      equal
      to the greater of (a) one tenth of one percent (0.1%) of the total number of
      shares of Common Stock issued and outstanding as of the last day of the fiscal
      quarter immediately preceding such date of conversion, calculated on a fully
      diluted basis after giving effect to the conversion of such share(s) of Series
      D
      and (b) One Hundred Thousand (100,000) shares of Common Stock. Each share of
      Series D Preferred Stock held by the Holders which has not been converted on
      or
      before June 30, 2009 into shares of Common Stock shall be convertible, at the
      option of the Holder of such share, at any time and from time to time after
      June
      30, 2009 into one tenth of one percent (0.1%) of the total number of shares
      of
      Common Stock issued and outstanding on June 30, 2009, calculated on a fully
      diluted basis after giving effect to the conversion of such share(s) of Series
      D
      Preferred Stock. The shares of Common Stock received upon conversion shall
      be
      fully paid and non-assessable shares of Common Stock. Due to the change in
      control of the Company, Mr. Connolly and his spouse may not convert debentures
      that would result in ownership of more than 4.99% of the Company at the time
      of
      conversion.


F-25


Pursuant
      to the closing date with Viewpoint Capital, LLC on December 5, 2007 (the
“ Closing
      Date ”),
      the
      Company disclosed that the Company entered into a Stock Purchase Agreement
      (the
“ Purchase
      Agreement ”)
      with
      Mr. Timothy J. Connolly, an individual and Viewpoint Capital, LLC, a Nevada
      limited liability company (the “ Investor ”)
      pursuant to which the Company issued to the Investor one (1) share of the
      Company’s Series E convertible preferred stock, par value $0.01 per share
      (“ Series
      E Preferred ”),
      which
      such Series E Preferred is convertible into Three Hundred Million Shares
      (300,000,000) of common stock of the Company, par value $0.001 per share
      (“ Common
      Stock ”)
      in
      exchange for the transfer by the Investor to the Company of Four Million
      (4,000,000) unrestricted, free-trading shares of common stock of Asset Capital
      Group, Inc., a Nevada corporation (“ ACGU
      Common Stock ”)
      having
      a value of Three Million Four Hundred Thousand Dollars ($3,400,000) based on
      the
      closing price of ACGU Common Stock as of the Closing Date as reported on the
      Pink Sheets, LLC. ACGU Common Stock trades under the symbol “ACGU.PK”. As a
      result of this transaction, the Investor acquired a 63.66% controlling interest
      in the Company’s Common Stock by virtue of the Investor’s ownership of the
      Series E Preferred. During the month of March 2008, we sold our investment
      in
      stock of ACGU for approximately $7,700.





On
      February 13, 2008, the Investor delivered to the Company a notice to convert
      the
      one (1) shares of Series E Preferred to Three Hundred Million (300,000,000)
      shares of Common Stock. On February 14, 2008, the Company issued to the Investor
      Three Hundred Million (300,000,000) shares of Common Stock, all of which are
      restricted, and canceled the One (1) share of Series E Preferred. As a result
      of
      this transaction, the Investor acquired a 63.66% controlling interest in the
      Common Stock of the Company.





NOTE
      13 -
      WARRANTS





At
      December 31, 2007 warrants were outstanding to purchase 200,000 shares of the
      Company's common stock for $1.00 per common share. The warrants expire in
      September 2008. At September 30, 2006, the Company issued 3,000,000 warrants
      to
      purchase the Company’s common stock at an exercise price of $.05 per share until
      December 31, 2007. These warrants were not exercised as of December 31,
      2007.





NOTE
      14 -
      STOCK OPTIONS





No
      options remain outstanding as of December 31, 2007.





NOTE
      15 – STOCK INCENTIVE PLAN





On
      May
      31, 2006, the Turnaround Partners, Inc. 2005 Stock Incentive Plan (the Plan)
      was
      adopted and approved by shareholders. On a calendar year basis, an amount of
      shares of Common Stock equivalent to the greater of 10 million common shares
      or
      fifteen percent (15%) of the fully diluted shares outstanding on January 2
      of
      any such calendar year may be allocated, at the discretion of the Administrator,
      to be granted as awards under the Plan, less awards outstanding at the end
      of
      the prior calendar year. At December 31, 2007 there were 7,250,000 shares
      available under the Plan.





NOTE
      16 -
      COMMITMENTS AND CONTINGENCIES





EMPLOYMENT
      CONTRACTS





On
      September 1, 2004, the Company entered into a five year employment agreement,
      effective June 1, 2004, with Tim Connolly, Chief Executive Officer and Vice
      Chairman of the Board. The agreement has a renewal provision and provides for
      an
      annual salary and bonus upon attaining certain performance criteria set by
      the
      board of directors. The agreement also provides certain anti-dilution provisions
      in return for an extension of lock-up of the Chief Executive Officer's shares
      until December 31, 2007 and for certain other fringe benefits. As a result
      of
      the agreement of December 5, 2007 with ACGU, Mr.
      Connolly resigned as Vice Chairman of the Board and as President and Chief
      Executive Officer of the Company, however Mr. Connolly shall continue to serve
      as President and Chief Executive Officer of Corporate Strategies, Inc., a Texas
      corporation and wholly-owned subsidiary of the Company (“ CSI ”)
      with
      the understanding that the business of CSI will be discontinued or spun off
      to
      its stockholders. In addition, Mr. Connolly shall continue to receive the same
      compensation as he has received through the Closing Date for his aforementioned
      continued services to CSI through December 31, 2008, which such date may be
      extended by mutual agreement by and among the parties to the Purchase Agreement.





On
      September 1, 2004, Corporate Strategies entered into a three year employment
      agreement with Fred Zeidman to serve as President and a director of Corporate
      Strategies. The agreement has a renewal provision and provides for an annual
      salary and bonus upon attaining certain performance criteria set by the board
      of
      directors and certain fringe benefits; in addition, Mr. Zeidman received 50%
      of
      all consulting fees from companies directly provided by or supervised by him.
      The employment agreement with Mr. Zeidman has not been renewed as of the date
      of
      this filing and Mr. Zeidman no longer receives compensation from Corporate
      Strategies.





On
      December 2, 2005, Kipling entered into a three year employment agreement with
      Timothy J. Connolly to serve as President and Chief Executive Officer. The
      agreement has a renewal provision and provides for an annual salary.
      Additionally, Mr. Connolly is entitled to a 10% interest in any distributions
      of
      any kind, dividends, income, bonuses or sale of the property owned by the
      Company.


F-26


LEASES





Until
      December 31, 2007, we leased our office space under an operating lease. Rental
      expense under operating leases for continuing operations aggregated $87,453
      and
      $76,395 for the years ended December 31, 2007 and 2006, respectively. Beginning
      January 1, 2008, this leased has been assumed by our then affiliate company,
      Natural Nutrition, Inc.





NOTE
      17 -
      RELATED PARTY TRANSACTIONS





ALLOCATION
      OF OPERATING EXPENSES





The
      Company performed certain administrative and management functions for CSI
      Business Finance, know known as iNutrition, Inc. Based on an estimation of
      efforts expended, Finance was allocated approximately $244,000 and $308,000
      for
      the years ended December 31, 2007 and 2006, respectively. For the years
      beginning 2008, the Company no longer provides these administrative
      services.





NOTE
      18 -
      INCOME TAXES





The
      following table sets forth a reconciliation of the statutory federal income
      tax
      for the year ended December 31, 2007 and 2006:





2007
            
            2006Income
                (loss) before taxes
            
            $
            (2,604,976
            )
            $
            4,936,074Income
                tax benefit computed at statutory rates
            
            $
            (885,692
            )
            $
            1,678,265Permanent
                differences, nondeductible expenses
            
            
            279,288
            
            
            8,390Increase
                in valuation allowance
            
            
            527,936
            
            
            365,207Net
                increase in fair value of derivative liability, net of amortization
                and
                debt modification gain
            
            
            82,368
            
            
            (1,078,674
            )Gain
                on sale of subsidiary
            
            
            -
            
            
            (1,034,418
            )Merger
                expense
            
            
            -
            
            
            47,600Net
                operating loss allocable to a subsidiary that was sold
            
            
            -
            
            
            1,594Other
            
            
            (3,900
            )
            
            12,036Tax
                (liability) benefit
            
            $
            -
            
            $
            -





The
      Company will file a consolidated tax return with its subsidiaries.





DEFERRED
      INCOME TAXES





The
      tax
      effects of the temporary differences between financial statement income and
      taxable income are recognized as a deferred tax asset and liability. Significant
      components of the deferred tax asset and liability as of December 31,
      2007
      is set out below:


F-27





Net
              operation loss
            
            
            11,312,332Valuation
                allowance
            
            
            (11,327,878
            )Revised
                net operating loss
            
            
            (290,696
            )Bad
                debt expense
            
            
            164,113Intangible
                asset tax basis difference
            
            
            123,462Unrealized
                loss on security transactions
            
            
            8,620Charitable
                contributions carried forward
            
            
            10,047Net
                deferred tax asset (liability)
            
            $
            -





The
      Company has a net operating loss carry forward estimated at $32,416,578 which expires
      through 2028. This loss is limited under Internal Revenue Code section 382.





NOTE
      19 -
      SEGMENT REPORTING





The
      Company had two segments: business services (which consists of turnaround
      execution services, management restructuring services, and business development
      services) and hotel investment.





The
      Company primarily provides business restructuring, turnaround execution and
      business development advisory services for emerging and re-emerging public
      companies.





The
      Company evaluates segment performance and allocates resources based on several
      factors, of which revenue and income before federal income tax are the primary
      financial measures. The accounting policies of the reportable segments are
      the
      same as those described in the footnote entitled "Summary of Significant
      Accounting Policies" of the Notes to the Consolidated Financial
      Statements.





The
      Company's operations are conducted in the United States.




**Business**
              
              **Hotel****Services**
              
              **Investment****Year
                  ended December 31, 2006**Revenue
              
              $
              1,127,219
              
              $
              -Interest
                  expense, net of interest income
              
              
              624,089
              
              
              194,494Income
                  (loss) before income tax, merger expense and discontinued
                  operations
              
              
              (1,269,423
              )
              
              3,032,779Income
                  from discontinued operations
              
              
              -
              
              
              4,688Segment
                  assets
              
              
              1,909,239
              
              
              5,197,536Additions
                  to long-term assets
              
              
              28,958
              
              
              5,043,239Depreciation
                  and amortization
              
              
              23,874
              
              
              -**Year
                  ended December 31, 2007**Revenue
              
              $
              1,107,437
              
              $
              -Interest
                  expense, net of interest income
              
              
              606,175
              
              
              797,450Loss
                  before income tax, merger expense and discontinued
                  operations
              
              
              (775,063
              )
              
              (1,829,912
              )Segment
                  assets
              
              
              691,273
              
              
              4,173,628Additions
                  to long-term assets
              
              
              3,091
              
              
              -Depreciation
                  and amortization
              
              
              24,041
              
              
              -


F-28