ITEM 6. PLAN OF OPERATION.

General

FIRSTPLUS Financial Group, Inc. (the "Company") was a diversified consumer finance company that originated, serviced, and sold consumer finance receivables. The Company operated through various subsidiaries until 1998 when macroeconomic factors adversely affected financial markets and largely destroyed the industry's access to the capital markets. Without access to working capital, the Company's ability to provide consumer-based products evaporated and, like virtually all its competitors, it saw its business liquidated to satisfy obligations. The Company's principal operating subsidiary, FIRSTPLUS Financial, Inc. ("FPFI"), engaged in the business of originating, purchasing, marketing and servicing home equity loans. Prior to the collapse of the financial markets, its primary loan product was a credit consolidation or home improvement loan, which was generally secured by a second lien on real property (commonly referred to as a "high loan to value" or "HLTV" loan). Over the course of many years, FPFI originated billions of dollars of loans. By 1998, FPFI had attained a market leadership position in the HLTV loan business.

In March 1999, two of the Company's wholly-owned subsidiaries, FPFI, and FIRSTPLUS Special Funding Corp., filed for reorganization under Chapter 11 of the United States Bankruptcy Code. FIRSTPLUS Special Funding Corp. was a special purpose entity formed to facilitate certain borrowings by FPFI. The filing was made in the United States Bankruptcy Court for the Northern District of Texas in Dallas. Neither the Company, nor any of its other subsidiaries, sought bankruptcy protection.

Although the Company was not subject to any bankruptcy proceedings, it had no income producing activities and was dependent on its subsidiaries to fund its obligations. FPFI was severely limited in its ability to provide funds to the Company as a result of the bankruptcy filing. The Company's other significant operating subsidiary at the time, Western Interstate Bancorp ("WIB"), was limited in its ability to release funds to the Company due to its debt covenant restrictions. Additionally WIB's main operating company, a FDIC-insured industrial loan company, FIRSTPLUS Bank, was also limited in the amount of funds that it could release by way of dividends or intercompany loans due to regulatory restrictions. These limitations caused the Company and its other subsidiaries to experience liquidity issues similar to FPFI.

The liquidity issues leading to the FPFI's bankruptcy filing and the subsequent lack of operations and sources of income of the Company required significant focus by senior management of the Company. Additionally, senior management concentrated on related strategic issues such as negotiating with lenders and creditors, finding new sources of financing, and reorganizing and recapitalizing the Company. The resources available to the Company have been limited by the liquidity issues and the downsizing of the Company and its operations.

Primarily due to lack of funds, the Company has for the most part been in a dormant capacity for the past several years. Since 1999, the Company has managed to avoid bankruptcy by negotiating with creditors and utilizing the anticipated but uncertain cash flow from an allowed unsecured claim against FPFI, more commonly known as the FPFG Intercompany Claim. The Company's management has withstood the pressure from creditors and avoided bankruptcy primarily by assigning portions of the FPFG Intercompany Claim to various creditors. However, the Company has maintained that one of its strategies has been to create value in the Company so that its prospects are enhanced for the future. The Company has been active in seeking a platform for operations and has pursued several

opportunities; however those opportunities were abandoned when the transactions did not meet the expectations of the Company after further examination and the Company learned of opposition to those transactions by certain shareholders.

Strategic Plan

Although the Company is not pursuing any specific opportunities at this time, it is reviewing the marketplace and its strategic plan. The areas for opportunity may include buying an existing company, merging with a growing concern or entering into a joint venture. In 2003, the Company received a substantial return on its investment in Capital Lending, a startup company which provides financial and risk services offering insured loan programs to financial institutions. In recent years, the financial services industry has seen substantial growth and the Company is confident that this trend will continue. The Company offers strong leadership with the vision and passion needed to catapult the Company into any sector of the industry.

The Company has not identified a target business

To date, the Company has not selected any target business on which to concentrate its search for a business combination. Thus, there is no basis to evaluate the possible merits or risks of any target business or potential transaction into which the Company may enter. To the extent the Company enters into a transaction with a financially unstable company or an entity in its early stage of development or growth, including entities without established records of sales or earnings, the Company may be affected by numerous risks inherent in the business and operations of financially unstable and early stage or potential emerging growth companies. Although the Company's management will endeavor to evaluate the risks inherent in a particular target business, the Company cannot assure you that it will properly ascertain or assess all significant risk factors.

Sources of potential opportunities

The Company anticipates that business opportunities will be brought to its attention from various sources, including its network relationships, who may present solicited or unsolicited proposals. The Company's officers and directors as well as their affiliates may also bring transaction candidates to the Company's attention. While the Company does not presently anticipate engaging the services of professional firms that specialize in business acquisitions on any formal basis, the Company may engage these firms in the future, in which event the Company may pay a finder's fee or other compensation. In no event, however, will the Company pay any of its existing officers, directors or shareholders or any entity with which they are affiliated any finder's fee or other compensation for services rendered to it prior to or in connection with the consummation of a transaction.

Selection of a potential business opportunity and structuring of a transaction

In evaluating a prospective business opportunity or transaction, the Company will consider, among other factors, the following:

o financial condition and results of operation;

o growth potential;

o experience and skill of management and availability of additional personnel;

o capital requirements;

o competitive position;

o stage of development of the products, processes or services;

o degree of current or potential market acceptance of the products, processes or services;

o proprietary features and degree of intellectual property or other protection of the products, processes or services;

o regulatory environment of the industry; and

o costs associated with effecting the business combination.

These criteria are not intended to be exhaustive. Any evaluation relating to the merits of a particular business opportunity or transaction will be based, to the extent relevant, on the above factors as well as other considerations deemed relevant by the Company's management in pursuing the business opportunity or transaction consistent with the Company's overall strategy. In evaluating a prospective business opportunity or transaction, the Company will conduct an extensive due diligence review which will encompass, among other things, meetings with incumbent management and inspection of facilities, as well as review of financial and other information which will be made available to the Company.

The fair market value of such business will be determined by the Company's Board of Directors based upon standards generally accepted by the financial community, such as actual and potential sales, earnings and cash flow and book value. If the Board of Directors is not able to independently determine that the target business has a sufficient fair market value, the Company will obtain an opinion or valuation from an unaffiliated, independent investment banking or business valuation firm with respect to the satisfaction of such criteria. For example, a valuation was obtained for the Company's proposed transaction with New Freedom Mortgage Corporation in 2001, although the transaction was not consummated, and the Company obtained a fairness opinion with respect to its initial equity investment in Capital Lending in 2002.

The time and costs required to select and evaluate a business opportunity and to structure and complete a transaction cannot presently be ascertained with any degree of certainty. Any costs incurred with respect to the identification and evaluation of a prospective business opportunity or transaction will result in a loss to the Company and reduce the amount of capital available to otherwise complete a business combination.

Probable lack of business diversification

While the Company may seek to pursue business opportunities with more than one target business, it is probable that the Company will have the ability to pursue only a single business opportunity or transaction. Accordingly, the prospects for the Company's success may be entirely dependent upon the future performance of a single business or investment. Unlike other entities that may have the resources to complete several transactions in multiple industries or multiple areas of a single industry, it is probable that the Company will not have the resources to diversify its operations or benefit from the possible spreading of risks or offsetting of losses. The Company's lack of diversification may:

o subject the Company to numerous economic, competitive and regulatory developments, any or all of which may have a substantial adverse impact upon the particular industry in which it may operate subsequent to a transaction, and

o result in the Company's dependency upon the development or market acceptance of a single or limited number of products, processes or services.

Limited ability to evaluate the target business' management

Although the Company intends to closely scrutinize a prospective business opportunity or transaction, the Company cannot assure you that its assessment of the prospective business opportunity or transaction will prove to be correct. Furthermore, the future role of the Company's officers and directors, if any, in a prospective business opportunity or transaction cannot presently be stated with any certainty. While it is possible that one or more of the Company's current officers and directors will remain associated in some capacity with the Company following a prospective business opportunity or transaction, it is unlikely that any of them will devote their full efforts to the Company's affairs subsequent to prospective business opportunity or transaction. Moreover, the Company cannot assure you that its officers and directors will have significant experience or knowledge relating to the operations of the particular prospective business opportunity or transaction.

Following a transaction, the Company may seek to recruit additional executive officers or employees to supplement its current management. The Company cannot assure you that it will have the ability to recruit additional executive officers or employees, or that additional executive officers or employees will have the requisite skills, knowledge or experience necessary to enhance the Company's current management.

Competition

In identifying, evaluating and selecting a business opportunity, the Company expects to encounter intense competition from other entities having similar business objectives. Many of these entities are well established and have extensive experience identifying and effecting business opportunities directly or through affiliates. Many of these competitors possess greater technical, human and other resources than the Company and its financial resources will be relatively limited when contrasted with those of many of these competitors. While the Company believes there are numerous potential business opportunities or transactions that may be available to it, the Company's ability to compete in pursuing these opportunities or transactions will be limited by its available financial resources. This inherent competitive limitation gives others an advantage in pursuing these business opportunities or transactions.

Any of these obligations may place the Company at a competitive disadvantage in successfully pursuing a business opportunity or transaction. The Company believes, however, that its network relationships and the experience of its management team and Board of Directors may give it a competitive advantage over other competitors for pursuing business opportunities or transactions.

Financial Reporting Issues

Changes In and Disagreements With Accountants on Accounting and Financial Disclosure

On June 3, 2005, the Company engaged Lightfoot Guest Moore & Co., PC, as its independent auditor for the year ending December 31, 2004. The Company had not formally had an independent auditor since September 1999, when Ernst & Young LLP resigned as the Company's principal accountant. The resignation of Ernst & Young LLP was discussed in a Current Report on Form 8-K filed with the Securities and Exchange Commission ("SEC") on October 6, 1999.

The Company disclosed the engagement of Lightfoot Guest Moore & Co., PC in a Current Report on Form 8-K filed with the SEC on September 22, 2005 (the "Form 8-K"), which included the following information:

On June 3, FirstPlus Financial Group, Inc. (the "Company") engaged Lightfoot Guest Moore & Co., PC as its new independent registered public accounting firm.

During the fiscal years ended December 31, 2004 and 2003 and through June 3, 2005, the Company had not consulted Lightfoot Guest Moore & Co., PC regarding either (i) the application of accounting principles to a specific completed or contemplated transaction, or the type of audit opinion that might be rendered on the Company's financial statements, and neither written nor oral advice was provided to the Company nor oral advice that was an important factor considered by the Company in reaching a decision as to the accounting, auditing or financial reporting issue; or (ii) any manner that was either the subject of a disagreement or event identified in response to paragraph (a)(1)(iv) of Item 304 of Regulation S-B.

Status of Financial Reporting

In January 1999, the Company announced that it would be implementing new accounting guidance regarding the valuation of its retained interests from securitization transactions which had been recently provided by the Financial Accounting Standards Board ("FASB"). FASB issued a draft Special Report ("A Guide to Implementation of Statement 125 on Accounting for Transfers and Servicing of Financial Assets and Extinguishments of Liabilities, Questions and Answers, Second Edition") which was finalized during December 1998. In this Special Report, FASB concluded that the "cash-out" method of valuing retained interests should be used to estimate fair value. The SEC Staff announced in December 1998 that the change to the "cash-out" method should be made by restatement. Based on this guidance, the Company decided to revise its methodology for estimating the fair value of certain financial instruments for each of the fiscal years in the three-year period ended September 30, 1997, the three-month transition period ended December 31, 1997, and the first three quarters of the fiscal year ended December 31, 1998. As the Company disclosed in its Form 10-Q for the quarter ended September 1998, it was expected that the impact would be material to the results of all prior periods.

As a result of limited resources and conflicting demands, the Company has not completed its analysis necessary to complete the restatement. In addition, the Company has not had the financial resources or personnel to prepare and file its periodic reports with the SEC. In July 2005, the Company received a letter from the SEC directing the Company to file all required reports or become subject to a revocation of registration under the

Securities Exchange Act of 1934. In connection with the shareholders' meeting described under the heading "--Litigation--Special Meeting," the Company has obtained audited financial statements it believes to be sufficient to distribute a proxy statement and solicit proxies for the shareholders' meeting and election of directors. However, this information alone will not cure the Company's reporting delinquencies with the SEC. The Company has initiated discussions with the SEC regarding its compliance issues and has started the process to prepare its plan to correct any SEC reporting delinquencies.

Following the settlement of the Class Action described under "--Litigation--Class Action Securities Litigation" below, the Company began to analyze the extent of its liabilities and reporting compliance issues. In 2004, the Company received a small return on its investment in Capital Lending which allowed it to pay mounting debts and begin becoming compliant with its charter requirements in the State of Nevada. This also allowed the Company to organize its financial records in preparation for an audit of its financial statements for the year ended December 31, 2004, which is an expensive and time consuming process. Through changes in management and the nature of FPFI's bankruptcy and litigation filed against the Company, the business records have been scattered. As a result, gathering the necessary information to complete audited financial statements has taken more time than anticipated or would be required under other circumstances. The Company cannot currently estimate when it will complete the restatement or the delinquent reports for past time periods.

FIRSTPLUS Financial Group, Inc.