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Proc-Type: 2001,MIC-CLEAR
Originator-Name: webmaster@www.sec.gov
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<SEC-DOCUMENT>0001019687-09-001109.txt : 20090331
<SEC-HEADER>0001019687-09-001109.hdr.sgml : 20090331
<ACCEPTANCE-DATETIME>20090330175947
ACCESSION NUMBER:		0001019687-09-001109
CONFORMED SUBMISSION TYPE:	DEF 14A
PUBLIC DOCUMENT COUNT:		1
CONFORMED PERIOD OF REPORT:	20090430
FILED AS OF DATE:		20090331
DATE AS OF CHANGE:		20090330
EFFECTIVENESS DATE:		20090331

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			SAVE THE WORLD AIR INC
		CENTRAL INDEX KEY:			0001103795
		STANDARD INDUSTRIAL CLASSIFICATION:	MOTOR VEHICLE PARTS & ACCESSORIES [3714]
		IRS NUMBER:				522088326
		STATE OF INCORPORATION:			NV
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		DEF 14A
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	000-29185
		FILM NUMBER:		09715447

	BUSINESS ADDRESS:	
		STREET 1:		235 TENNANT AVE #5
		CITY:			MORGAN HILL
		STATE:			CA
		ZIP:			95037
		BUSINESS PHONE:		818-487-8000

	MAIL ADDRESS:	
		STREET 1:		235 TENNANT AVE #5
		CITY:			MORGAN HILL
		STATE:			CA
		ZIP:			95037
</SEC-HEADER>
<DOCUMENT>
<TYPE>DEF 14A
<SEQUENCE>1
<FILENAME>stw_def14a-043009.htm
<DESCRIPTION>SAVE THE WORLD AIR, INC.
<TEXT>
<html>
  <head>
    <title>stw_def14a-043009.htm</title>
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STATES</font></div>
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AND EXCHANGE COMMISSION</font></div>
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DC 20549</font></div>
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14A</font></div>
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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Proxy
Statement Pursuant to Section 14(a) of the Securities</font></div>
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Act of 1934</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Filed by
the Registrant <font style="DISPLAY: inline;" face="Wingdings">x</font></font></div>
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a party other than the Registrant <font style="DISPLAY: inline;" face="Wingdings">o</font></font></div>
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box:</font></font>

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              <td width="98%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Preliminary proxy
      statement</font></td>
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            <tr>
              <td width="2%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font size="+0"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font size="+0" style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font style="DISPLAY: inline; FONT-FAMILY: wingdings">o</font></font></font></font></font></font></td>
              <td width="98%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Confidential, For
      use of the Commission only (as permitted by Rule 14a-6(e)(2))</font></td>
            </tr>
            <tr>
              <td width="2%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font size="+0"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font size="+0" style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font style="DISPLAY: inline; FONT-FAMILY: wingdings">x</font></font></font></font></font></font></td>
              <td width="98%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Definitive proxy
      statement</font></td>
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            <tr>
              <td width="2%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font size="+0"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font size="+0" style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font style="DISPLAY: inline; FONT-FAMILY: wingdings">o</font></font></font></font></font></font></td>
              <td width="98%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Definitive
      additional materials</font></td>
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            <tr>
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              <td width="98%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Soliciting material
      pursuant to Rule 14a-11(c) or Rule
14a-12</font></td>
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INC.</font>&#160; </font>

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of Registrant as Specified in Its Charter)</font></div>
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Person(s) Filing Proxy Statement, if Other Than the Registrant)</font></div>
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of filing fee (Check the appropriate box):</font></div>
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required.</font></div>
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computed on table below per Exchange Act Rules 14a-6(i)(1) and
0-11.</font></div>
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of each class of securities to which transaction applies:</font></div>
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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(2)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Aggregate
number of securities to which transaction applies:</font></div>
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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">
      <hr style="COLOR: black" align="left" noshade size="1" width="100%">
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(3)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Per
unit price or other underlying value of transaction computed pursuant to
Exchange Act Rule 0-11 (Set forth the amount on which the filing fee is
calculated and state how it was determined):</font></div>
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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">
      <hr style="COLOR: black" align="left" noshade size="1" width="100%">
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(4)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Proposed
maximum aggregate value of transaction:</font></div>
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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">
      <div>
        <hr style="COLOR: black" align="left" noshade size="1" width="100%">
      </div>
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    <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;</font></div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(5)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Total
fee paid:</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">
      <hr style="COLOR: black" align="left" noshade size="1" width="100%">
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" width="100%">
          <tr>
            <td align="left" valign="top" width="6%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: wingdings">o</font></div>
            </td>
            <td align="left" valign="top" width="72%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Fee
      paid previously with preliminary
materials:</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" width="100%">
          <tr>
            <td align="left" valign="top" width="6%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: wingdings">o</font></div>
            </td>
            <td align="left" valign="top" width="72%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Check
      box if any part of the fee is offset as provided by Exchange Act Rule
      0-11(a)(2) and identify the filing for which the offsetting fee was paid
      previously.&#160;&#160;Identify the previous filing by registration
      statement number, or the form or schedule and the date of its
      filing.</font></div>
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          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(1)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Amount
previously paid:</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">
      <hr style="COLOR: black" align="left" noshade size="1" width="100%">
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(2)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Form,
Schedule or Registration Statement No.:</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">
      <div>
        <hr style="COLOR: black" align="left" noshade size="1" width="100%">
      </div>
    </div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(3)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Filing
Party:</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">
      <div>
        <hr style="COLOR: black" align="left" noshade size="1" width="100%">
      </div>
    </div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(4)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Date
Filed:</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">
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        <div id="GLFTR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-SIZE: 8pt; COLOR: #000000; FONT-FAMILY: Times New Roman">&#160;
</font></div>
      </div>
      <div id="PN" style="PAGE-BREAK-AFTER: always">
        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">&#160;
</font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
          <hr style="COLOR: black" noshade size="1">
        </div>
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        <div id="GLHDR" style="WIDTH: 100%" align="right"><font style="DISPLAY: inline; FONT-SIZE: 8pt; COLOR: #000000; FONT-FAMILY: Times New Roman">&#160;
</font></div>
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    </div><br>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">SAVE
THE WORLD AIR, INC.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">235
Tennant Avenue</font></div>
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Hill, CA 95037 </font>

      <div>
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      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold">NOTICE OF 2009 ANNUAL MEETING OF
STOCKHOLDERS</font></font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">To
Be Held on April 30, 2009</font></div>
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    <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">To Our
Stockholders:</font></div>
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      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;
You are cordially invited to attend the 2009 Annual Meeting of Stockholders (the
&#8220;2009 Annual Meeting&#8221;) of Save the World Air, Inc. (the &#8220;Company&#8221;), which will
be held at&#160;&#160;the Hilton Universal Hotel, 555 Universal Hollywood Drive,
Universal City, California 91608, at 10:00&#160;a.m. on Thursday, April 30,
2009&#160;&#160;for the purposes of considering and voting
upon:</font></div>
    </div>
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      </font></td>
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      </font></td>
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      </font></td>
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              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;&#160;&#160;&#160;&#160;
      1.&#160;A proposal to elect five (5) directors to our Board of
      Directors.</font></div>
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            <td valign="middle" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
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      </font></td>
          </tr>
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            <td valign="top" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="top" width="76%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;&#160;&#160;&#160;&#160;&#160;2.&#160;&#160;A
      proposal to ratify the appointment of Weinberg &amp; Co., P.A. as our
      independent auditor for the fiscal year ended December 31,
      2008.</font></div>
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    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
      <div style="DISPLAY: block; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">These
matters are described more fully in the proxy statement accompanying this
notice.</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
      <div style="DISPLAY: block; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Our
stockholders will also act upon such other business as may properly come before
the meeting or any adjournment or postponement thereof. The Board is not aware
of any other business to be presented to a vote of the stockholders at the 2009
Annual Meeting.</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
      <div style="DISPLAY: block; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The Board
has fixed the close of business on March 2, 2009 as the record date (the &#8220;Record
Date&#8221;) for determining those stockholders who will be entitled to notice of and
to vote at the 2009Annual Meeting. The stock transfer books will remain open
between the Record Date and the date of the 2009 Annual
Meeting.</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
      <div style="DISPLAY: block; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Representation
of at least a majority in voting interest of our common stock either in person
or by proxy is required to constitute a quorum for purposes of voting on each
proposal to be voted on at the 2009 Annual Meeting. Accordingly, it is important
that your shares be represented at the 2009 Annual Meeting. <font style="DISPLAY: inline; FONT-WEIGHT: bold">WHETHER OR NOT YOU PLAN TO ATTEND THE
2009ANNUAL MEETING, PLEASE COMPLETE, DATE AND SIGN THE ENCLOSED PROXY CARD AND
RETURN IT IN THE ENCLOSED ENVELOPE.</font> Your proxy may be revoked at any time
prior to the time it is voted at the 2009 Annual Meeting.</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
      <div style="DISPLAY: block; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Please
read the accompanying proxy material carefully. Your vote is important and we
appreciate your cooperation in considering and acting on the matters
presented.</font></div>
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    </div>
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      </font></td>
            <td align="left" valign="top" width="39%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">By
      Order of the Board of Directors,</font></div>
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      </font></td>
            <td valign="middle" width="39%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
          </tr>
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            <td align="left" valign="top" width="61%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td align="left" valign="top" width="39%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Cecil
      Bond Kyte</font></div>
            </td>
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      </font></td>
            <td align="left" valign="top" width="39%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: times new roman">Chief
      Executive Officer</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">March 30,
2009</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Morgan
Hill, California</font></div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Stockholders
Should Read the Entire Proxy Statement</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Carefully
Prior to Returning Their Proxies</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
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          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">1</font></div>
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      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">PROXY
STATEMENT FOR</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2009
ANNUAL MEETING OF STOCKHOLDERS</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">OF</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">SAVE
THE WORLD AIR, INC.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">To
Be Held on April 30, 2009</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">This
proxy statement is furnished in connection with the solicitation by our Board of
Directors (the &#8220;Board&#8221;) of proxies to be voted at the 2009 Annual Meeting of
Stockholders (the &#8220;2009 Annual Meeting&#8221;) of Save the World Air, Inc. (the
&#8220;Company&#8221;), which will be held at 10:00&#160;a.m. on April 30, 2009 at the
Hilton Universal Hotel, 555 Universal Hollywood Drive, Universal City,
California 91608, or at any adjournments or postponements thereof, for the
purposes set forth in the accompanying Notice of 2009 Annual Meeting of
Stockholders (the &#8220;Notice&#8221;). This proxy statement and the proxy card are first
being delivered or mailed to stockholders on or about March 30, 2009. Our 2008
Annual Report for the year ended December&#160;31, 2008 on Form&#160;10-K (the
&#8220;10-K&#8221;) is being mailed to stockholders concurrently with this proxy
statement.&#160;&#160;Our Annual Report to Stockholders on 10-K is not to be
regarded as proxy soliciting material or as a communication by means of which
any solicitation of proxies is to be made.</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold">VOTING RIGHTS AND
SOLICITATION</font></font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
      <div style="DISPLAY: block; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The close
of business on March 2, 2009 is the record date (the &#8220;Record Date&#8221;) for
stockholders entitled to notice of and to vote at the 2009 Annual Meeting. As of
the Record Date, we had 64,498,834 shares of common stock, par value
$.001&#160;per share issued and outstanding. All of the shares of our common
stock outstanding on the Record Date, and only those shares, are entitled to
vote on each of the proposals to be voted upon at the 2009 Annual Meeting.
Holders of the common stock of record entitled to vote at the 2009 Annual
Meeting will have one vote for each share of common stock so held with regard to
each matter to be voted upon.</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">All votes
will be tabulated by the inspector of elections appointed for the 2009 Annual
Meeting, who will separately tabulate affirmative and negative votes,
abstentions and broker non-votes.</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
holders of a majority in voting interest of the common stock outstanding and
entitled to vote at the 2009Annual Meeting shall constitute a quorum for the
transaction of business at the 2009 Annual Meeting. The voting interest of
shares of the common stock represented in person or by proxy will be counted for
purposes of determining whether a quorum is present at the 2009 Annual Meeting.
Shares which abstain from voting as to a particular matter will be treated as
shares that are present and entitled to vote for purposes of determining the
voting interest present and entitled to vote with respect to any particular
matter, but will not be counted as votes cast on such matter. If a broker or
nominee holding stock in &#8220;street name&#8221; indicates on a proxy that it does not
have discretionary authority to vote as to a particular matter, those shares
will not be considered as present and entitled to vote with respect to such
matter and will not be counted as a vote cast on such matter.</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In voting
with regard to the proposal to elect directors (Proposal&#160;1), stockholders
may vote in favor of all the nominees, withhold their votes as to all nominees
or withhold their votes as to a specific nominee. The vote required by
Proposal&#160;1 is governed by Nevada law and is a plurality of the votes cast
by the holders of shares entitled to vote, (i.e., nominees receiving the highest
number of votes will be elected to the Board) provided a quorum is present. As a
result, in accordance with Nevada law, votes that are withheld and broker
non-votes will not be counted and will have no effect on the voting for election
of directors.</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In voting
with regard to the proposal to ratify the appointment of our independent auditor
(Proposal&#160;2), stockholders may vote in favor of such proposal or against
such proposal or may abstain from voting. The vote required to approve
Proposal&#160;2 is governed by Nevada law, and the minimum vote required is a
majority of the total votes cast on such proposal, provided a quorum is present.
As a result, in accordance with Nevada law, abstentions and broker non-votes
will not be counted and will have no effect on the outcome of the vote on this
proposal.</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Under the
rules of The New York Stock Exchange (the &#8220;NYSE&#8221;) that govern most domestic
stock brokerage firms, member brokerage firms that hold shares in &#8220;street name&#8221;
for beneficial owners may, to the extent that such beneficial owners do not
furnish voting instructions with respect to any or all proposals submitted for
stockholder action, vote in their discretion upon proposals which are considered
&#8220;discretionary&#8221; proposals under the rules of the NYSE. Member brokerage firms
that have received no instructions from their clients as to &#8220;non-discretionary&#8221;
proposals do not have discretion to vote on these proposals. Such broker
non-votes will not be considered in determining whether a quorum exists at the
2009 Annual Meeting and will not be considered as votes cast in determining the
outcome of any proposal.</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Shares of
our common stock represented by proxies in the accompanying form which are
properly executed and returned to us will be voted at the 2009 Annual Meeting in
accordance with the stockholders&#8217; instructions contained therein. In the absence
of contrary instructions, shares represented by such proxies will be voted FOR
each of Proposal&#160;1, and Proposal&#160;2.&#160;&#160;Management does not
know of any matters to be presented at the 2009 Annual Meeting other than those
set forth in this proxy statement and in the Notice accompanying this proxy
statement. If other matters should properly come before the 2009 Annual Meeting,
the proxyholders will vote on such matters in accordance with their best
judgment.</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Any
stockholder has the right to revoke his, her or its proxy at any time before it
is voted at the 2009 Annual Meeting by giving written notice to our Secretary,
and by executing and delivering to the Secretary a duly executed proxy card
bearing a later date, or by appearing at the 2009 Annual Meeting and voting in
person; <font style="DISPLAY: inline; FONT-STYLE: italic">provided,
however</font>, that under the rules of the NYSE, any beneficial owner whose
shares are held in &#8220;street name&#8221; by a member brokerage firm may revoke his, her
or its proxy and vote his, her or its shares in person at the 2009 Annual
Meeting only in accordance with the applicable rules and procedures of the
NYSE.</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
entire cost of soliciting proxies will be borne by the Company. Proxies will be
solicited principally through the use of the mails, but, if deemed desirable,
may be solicited personally or by telephone, or special letter by our officers
and regular employees for no additional compensation. Arrangements may be made
with brokerage houses and other custodians, nominees and fiduciaries to send
proxies and proxy material to the beneficial owners of our common stock, and
such persons may be reimbursed for their expenses.</font></div>
    </div><br>
    <div id="PGBRK" style="MARGIN-LEFT: 0pt; WIDTH: 100%; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
      <div id="FTR">
        <div id="GLFTR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-SIZE: 8pt; COLOR: #000000; FONT-FAMILY: Times New Roman">&#160;
</font></div>
      </div>
      <div id="PN" style="PAGE-BREAK-AFTER: always">
        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2</font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
          <hr style="COLOR: black" noshade size="1">
        </div>
      </div>
      <div id="HDR">
        <div id="GLHDR" style="WIDTH: 100%" align="right"><font style="DISPLAY: inline; FONT-SIZE: 8pt; COLOR: #000000; FONT-FAMILY: Times New Roman">&#160;
</font></div>
      </div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold">PROPOSAL&#160;1</font></font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold">ELECTION OF
DIRECTORS</font></font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold">Composition of Board of
Directors</font></font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Our
bylaws provide that the Board shall consist of between one and eight directors,
as determined by the Board from time to time. The Board currently consists of
five (5) members elected by the holders of the common stock... The Board has
fixed the size of the Board to be elected at the 2009 Annual Meeting at five (5)
members.&#160;&#160;Our directors are elected by our stockholders at each annual
meeting of stockholders and will serve until their successors are elected and
qualified, or until their earlier resignation or removal. There are no family
relationships among any of our current directors, the nominees for directors or
our executive officers. &#160;</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
proxyholders named on the proxy card intend to vote all proxies received by them
in the accompanying form&#160;for the election of the nominees listed below,
unless instructions to the contrary are marked on the proxy. These nominees have
been selected by the Board. All of the nominees are currently members of the
Board. If elected, each nominee will serve until the annual meeting of
stockholders to be held in 2010 or until his or her successor has been duly
elected and qualified.</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In the
event that a nominee is unable or declines to serve as a director at the time of
the 2009 Annual Meeting, the proxies will be voted for any nominee who shall be
designated by the present Board to fill the vacancy. In the event that
additional persons are nominated for election as directors, the proxyholders
intend to vote all proxies received by them for the nominees listed below,
unless instructions are given to the contrary. As of the date of this proxy
statement, the Board is not aware of any nominee who is unable or will decline
to serve as a director.</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Nominees
for Election as Directors</font></div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font>The following is certain information as
of March 30, 2009, regarding the nominees for election as
directors:</font></div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
    <div align="center">
      <table bgcolor="white" cellpadding="0" cellspacing="0" width="100%">
          <tr>
            <td valign="bottom" width="30%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Name&#160;</font></td>
            <td valign="bottom" width="6%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Age</font></td>
            <td valign="bottom" width="28%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Position&#160;</font></td>
            <td valign="bottom" width="36%">
              <div><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Director</font></div>
              <div><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Since</font></div>
            </td>
          </tr>
          <tr>
            <td width="30%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
            <td width="6%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
            <td width="28%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
            <td width="36%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
          </tr>
          <tr>
            <td width="30%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Cecil Bond Kyte
      (1)&#160;</font></td>
            <td width="6%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">38</font></td>
            <td width="28%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Chief Executive
      Officer, Chairman&#160;&#160;&#160;&#160;</font></td>
            <td width="36%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2006</font></td>
          </tr>
          <tr>
            <td width="30%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Charles R.
      Blum</font></td>
            <td width="6%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">71</font></td>
            <td width="28%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">President,
      Director&#160;&#160;</font></td>
            <td width="36%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2007</font></td>
          </tr>
          <tr>
            <td width="30%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Steven Bolio (2)
      (3)&#160;&#160;</font></td>
            <td width="6%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">64&#160;</font></td>
            <td width="28%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Director&#160;</font></td>
            <td width="36%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2007</font></td>
          </tr>
          <tr>
            <td width="30%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">John F. Price PhD
      (1) (2) (3)&#160;</font></td>
            <td width="6%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">66</font></td>
            <td width="28%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Director&#160;</font></td>
            <td width="36%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2002</font></td>
          </tr>
          <tr>
            <td width="30%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Nathan Shelton (1)
      (2)&#160;</font></td>
            <td width="6%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">60</font></td>
            <td width="28%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Director&#160;</font></td>
            <td width="36%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2007</font></td>
          </tr>
      </table>
    </div>
    <div><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(1)&#160;&#160;&#160;Member
of the Audit Committee</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(2)&#160;&#160;&#160;Member
of the Compensation Committee</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(3)&#160;&#160;&#160;Member
of the Nominating and Corporate Governance Committee</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold">Biographical Information Regarding
Directors</font></font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-STYLE: italic">Cecil Bond Kyte
</font>has served as a director since February 21, 2006. In December 2007, Mr.
Kyte was elected by the Board of Directors to serve as Chairman of the
Board.&#160;&#160;On January 30, 2009, he was appointed to serve as Chief
Executive Officer, replacing Charles R. Blum. Since December 2002, Mr. Kyte has
been an investor in a number of businesses, including those in oil and gas
exploration, and financial services.&#160;&#160;These include SwissGuard
International, GmbH, based in Zurich, Switzerland, of which he is a
co-founder.&#160;&#160;SwissGuard serves the American annuity market with an
emphasis on asset protection and growth. From February 2000 to November 2002,
Mr. Kyte was employed by Chautauqua Airways, a United Airlines regional carrier,
in various capacities, including service as an airline captain.&#160;&#160;He
received his B.S. Degree in Accounting from Long Beach State
University.</font></div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-STYLE: italic">Charles R.
Blum</font> was appointed on July 25, 2007 to the Board of directors and engaged
as the President and Chief Executive Officer of the Company. On January 30,
2009, Mr. Blum resigned his position as Chief Executive Officer of the Company
but continues to serve as President. Mr. Blum spent 22 years as the
President/CEO of the Specialty Equipment Market Association
(SEMA).&#160;&#160;SEMA is a trade group representing 6500 business members who
are actively engaged in the manufacture and distribution of automotive parts and
accessories. SEMA produces the world&#8217;s largest automotive aftermarket Trade Show
which is held annually in Las Vegas, Nevada. Mr. Blum led the association as its
members grew from a handful of small entrepreneurial companies into an industry
membership that sells over 31 billion dollars of product at the retail level
annually. Mr. Blum has a proven record of accomplishment as a senior executive
and brings a broad knowledge of the automotive aftermarket to the
Company.&#160;&#160;Mr. Blum attended Rutgers University.</font></div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-STYLE: italic">Steven
Bolio</font> was appointed to the Board of Directors on February 12,
2007.&#160;&#160;Mr. Bolio has held prominent positions with a number of
businesses in the automotive specialty equipment industry spanning a forty-five
year successful career with experience in retail, wholesale, product development
and manufacturing.&#160;&#160;For the past 18 years, Mr. Bolio is a partner in
the firm of Scafidi-Bolio &amp; Associates, a manufacturing representative group
serving the automotive aftermarket industry. He served 6 years on the Specialty
Equipment Market Association (SEMA) Board of Directors as well as on multiple
SEMA committees.&#160;&#160;In 2006 he was elected to the SEMA &#8220;Hall of
Fame.&#8221;&#160;&#160;Mr. Bolio attended Bentley College.</font></div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
    <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
      <div id="FTR">
        <div id="GLFTR" style="WIDTH: 100%" align="left">
        </div>
      </div>
      <div id="PN" style="PAGE-BREAK-AFTER: always">
        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">3</font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
          <hr style="COLOR: black" noshade size="1">
        </div>
      </div>
      <div id="HDR">
        <div id="GLHDR" style="WIDTH: 100%" align="right">
        </div>
      </div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;<font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-STYLE: italic">John F. Price,
Ph.D.,</font><font style="DISPLAY: inline; FONT-STYLE: italic">&#160;</font>has
served as a director since May 2002. He co-founded and has served as Chairman of
the Board of Conscious Investing Pty Ltd., located in Sydney, Australia, a
software company, since May 2001. In June 1998, Mr.&#160;Price founded Price
Value, Inc., located in Sydney, Australia, a software company to market software
that he developed. He has served as Chairman of the Board of Price Value, Inc.,
located in Sydney, Australia since 1998. Since October 1997, Mr.&#160;Price has
held various teaching positions in mathematics and physics at University of New
South Wales, located in Sydney, Australia. From 1990 to 1998, he was professor
and head of the Mathematics Department at Maharishi University of Management
located in Sydney, Australia. Mr.&#160;Price received a B.Sc. and M.Sc. from the
University of Melbourne and a Ph.D. from the Australian National
University.</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold">&#160;</font><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-STYLE: italic">Nathan
Shelton</font> has served as our director since February 12, 2007. Mr. Shelton
has a long and distinguished career with a number of diverse successful
companies primarily related to the automotive industry, holding prominent
positions.&#160;&#160;In 1987 he joined K&amp;N Engineering as President and
part owner and built the company into an industry leader.&#160;&#160;In 2002 he
sold his interest in K&amp;N Engineering and founded S&amp;S Marketing, which is
engaged the automotive aftermarket parts rep business, which he currently
operates. Mr. Shelton is the recipient of numerous industry related prestigious
awards and in 1992, Specialty Equipment Market Association (SEMA) invited him to
join its board of directors, which includes serving in capacity as its Chairman
from 2002 to 2004. Mr. Shelton served honorably in the United States Seabees
from 1968 to 1972.&#160;&#160;He attended Chaffey Junior College.</font></div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Executive
Officers</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
following table sets forth certain information regarding our executive officers
as of March 30, 2009:</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
      <div style="MARGIN-LEFT: 36pt" align="center">
        <table bgcolor="white" cellpadding="0" cellspacing="0" width="100%">
            <tr>
              <td width="15%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font style="TEXT-DECORATION: underline">Name</font></font></td>
              <td width="9%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; TEXT-DECORATION: underline">Age</font></td>
              <td width="76%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; TEXT-DECORATION: underline">Position</font></td>
            </tr>
            <tr>
              <td width="15%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td width="9%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td width="76%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
            </tr>
            <tr>
              <td width="15%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Cecil Bond
      Kyte</font></td>
              <td width="9%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">38&#160;</font></td>
              <td width="76%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Chief Executive
      Officer</font></td>
            </tr>
            <tr>
              <td width="15%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td width="9%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td width="76%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
            </tr>
            <tr>
              <td width="15%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Charles R.
      Blum&#160;&#160;&#160;</font></td>
              <td width="9%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">71&#160;</font></td>
              <td width="76%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">President</font></td>
            </tr>
            <tr>
              <td width="15%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td width="9%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td width="76%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
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            <tr>
              <td width="15%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Eugene E.
      Eichler&#160;</font></td>
              <td width="9%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">82</font></td>
              <td width="76%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Interim Chief
      Financial Officer</font></td>
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      <div>&#160;</div>
      <div style="TEXT-INDENT: 36pt"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">For
the biographies of&#160;&#160;Cecil Bond Kyte and Charles R. Blum, please see
above under &#8220;Biographical Information Regarding Directors.&#8221;</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-STYLE: italic">Eugene E.
Eichler</font>, CPA, is currently our Interim Chief Financial
Officer.&#160;&#160;&#160;The Company intends to obtain a Chief Financial
Officer on a permanent basis to replace Mr. Eichler once a suitable replacement
is available. He served as our Chief Executive Officer from October 2005 until
November 2006, at which time he separated from the company due to medical
disability. He served as our Chief Financial Officer since May 2002 until
November 2006 and was been a director from May 2002 until December 2007... Mr.
Eichler served as our President from March 2004 to October 2005 and as our Chief
Operating Officer from October 2001 to March 2004. Mr. Eichler was the Chief
Financial Officer and Firm Administrator of the law firm Masry &amp; Vititoe
from 1982 to October 2001. From 1974 to 1982, Mr. Eichler provided financial
consulting services to Foundation for HMO&#8217;s, Acne Care Medical Clinics and Earth
Foods, Inc. From 1960 to 1974, Mr. Eichler headed financial consulting services
for Milburn Industries and Brown, Eichler &amp; Company. From 1953 to 1960, he
held the position of Chief Budgets and Forecasts at North American Aviation.
From 1951 to 1953, Mr. Eichler held various audit positions at the Atomic Energy
Commission. Mr. Eichler received a B.A. from University of
Montana.</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold">CORPORATE
GOVERNANCE</font></font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We
maintain a corporate governance page on our corporate website at <font style="DISPLAY: inline; FONT-STYLE: italic; TEXT-DECORATION: underline">www.stwa.com</font>,
which includes information regarding the Company&#8217;s corporate governance
practices. Our codes of business conduct and ethics, Board committee charters
and certain other corporate governance documents and policies and code of
business conduct will be posted on our website. In addition, we will provide a
copy of any of these documents without charge to any stockholder upon written
request made to Corporate Secretary, Save the World Air, Inc., 235 Tennant
Avenue, Morgan Hill, California 95037.&#160;&#160;The information on our website
is not, and shall not be deemed to be, a part of this proxy statement or
incorporated by reference into this or any other filing we make with the
Securities and Exchange Commission (the &#8220;SEC&#8221;).</font></div>
    </div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;<font style="DISPLAY: inline; FONT-WEIGHT: bold">Board of
Directors</font></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" width="100%">
          <tr>
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      </font></td>
            <td valign="top" width="76%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: times new roman">Director
      Independence</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
      <div style="DISPLAY: block; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Our Board
of Directors currently consists of five (5) members. The Board has affirmatively
determined that Messrs.&#160; Price, Shelton, and Bolio are independent
directors. The &#8220;nominated&#8221; five (5) directors for the 2009 Annual Meeting are
independent with the exception of Mr. Kyte, our Chief Executive Officer and Mr.
Blum, our President.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    </div>
    <div>
      <table cellpadding="0" cellspacing="0" width="100%">
          <tr>
            <td valign="top" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="top" width="76%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: times new roman">Meetings
      of the Board</font></div>
            </td>
          </tr>
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    <div>&#160;</div>
    <div style="TEXT-INDENT: 36pt"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The Board
held three (3) meetings and acted by written consent three (3) times during 2008
and&#160;&#160;two (2) meetings to date in 2009. Each of the directors<font style="DISPLAY: inline; FONT-WEIGHT: bold">&#160;</font>attended 75% or more of
the aggregate number of meetings of the Board and Committees on which the
director served in 2008 and 2009.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Each of
our directors is encouraged to attend the Company&#8217;s 2009 Annual Meeting and to
be available to answer any questions posed by stockholders to such director.
Because our Board holds one of its regular meetings in conjunction with our
Annual Meeting of stockholders, we anticipate that all of the members of the
Board will be present for the 2009 Annual Meeting.</font></div>
    </div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
    <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
      <div id="FTR">
        <div id="GLFTR" style="WIDTH: 100%" align="left">
        </div>
      </div>
      <div id="PN" style="PAGE-BREAK-AFTER: always">
        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">4</font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
          <hr style="COLOR: black" noshade size="1">
        </div>
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      <div id="HDR">
        <div id="GLHDR" style="WIDTH: 100%" align="right">
        </div>
      </div>
    </div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" width="100%">
          <tr>
            <td valign="top" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="top" width="76%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: times new roman">Communications
      with the Board</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
following procedures have been established by the Board in order to facilitate
communications between our stockholders and the Board:</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    </div>
    <div>
      <table cellpadding="0" cellspacing="0" width="100%">
          <tr>
            <td valign="top" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="top" width="1%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#8226;&#160;</font></div>
            </td>
            <td valign="top" width="75%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Stockholders
      may send correspondence, which should indicate that the sender is a
      stockholder, to the Board or to any individual director, by mail to
      Corporate Secretary, Save the World Air, Inc., 235 Tennant Avenue, Morgan
      Hill, California 95037 or by e-mail to <font style="DISPLAY: inline">questions @www.stwa.com.</font></font></div>
            </td>
          </tr>
          <tr>
            <td valign="middle" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="middle" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="middle" width="75%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
          </tr>
          <tr>
            <td valign="top" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="top" width="1%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#8226;&#160;</font></div>
            </td>
            <td valign="top" width="75%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Our
      Secretary will be responsible for the first review and logging of this
      correspondence and will forward the communication to the director or
      directors to whom it is addressed unless it is a type of correspondence
      which the Board has identified as correspondence which may be retained in
      our files and not sent to directors. The Board has authorized the
      Secretary to retain and not send to directors communications that:
      (a)&#160;are advertising or promotional in nature (offering goods or
      services), (b)&#160;solely relate to complaints by customers with respect
      to ordinary course of business customer service and satisfaction issues or
      (c)&#160;clearly are unrelated to our business, industry, management or
      Board or committee matters. These types of communications will be logged
      and filed but not circulated to directors. Except as set forth in the
      preceding sentence, the Secretary will not screen communications sent to
      directors.</font></div>
            </td>
          </tr>
          <tr>
            <td valign="middle" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="middle" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="middle" width="75%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
          </tr>
          <tr>
            <td valign="top" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="top" width="1%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#8226;&#160;</font></div>
            </td>
            <td valign="top" width="75%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">The
      log of stockholder correspondence will be available to members of the
      Board for inspection. At least once each year, the Secretary will provide
      to the Board a summary of the communications received from stockholders,
      including the communications not sent to directors in accordance with the
      procedures set forth above.</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
      <div style="DISPLAY: block; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Our
stockholders may also communicate directly with the non-management directors,
individually or as a group, by mail c/o&#160;Corporate Secretary, Save the World
Air, Inc., 235 Tennant Avenue, Morgan Hill, California 95037 or by e-mail to
<font style="DISPLAY: inline; TEXT-DECORATION: underline">questions@www.stwa.com.</font></font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
      <div style="DISPLAY: block; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The Audit
Committee has established procedures, as outlined in the Company&#8217;s policy for
<font style="DISPLAY: inline; FONT-WEIGHT: bold">&#8220;</font>Procedures for
Accounting and Auditing Matters<font style="DISPLAY: inline; FONT-WEIGHT: bold">&#8221;,&#160;&#160;</font>for the receipt,
retention and treatment of complaints regarding questionable accounting,
internal controls, and financial improprieties or auditing matters. Any of the
Company&#8217;s employees may confidentially communicate concerns about any of these
matters by calling (408)&#160;778-0101. Upon receipt of a complaint or concern,
a determination will be made whether it pertains to accounting, internal
controls or auditing matters and if it does, it will be handled in accordance
with the procedures established by the Audit Committee.
&#160;</font></div>
    </div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold">Committees of the
Board</font></font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
      <div style="DISPLAY: block; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The Board
has a standing Audit Committee, Compensation Committee, and Nominating and
Corporate Governance Committee. Each of these committees operates under a
written charter. Copies of these charters, and other corporate governance
documents, are available on our website, <font style="DISPLAY: inline; TEXT-DECORATION: underline">www.stwa.com</font> In
addition, we will provide a copy of any of these documents without charge to any
stockholder upon written request made to Corporate Secretary, Save the World
Air, Inc., 235 Tennant Avenue, Morgan Hill, California 95037.</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
      <div style="DISPLAY: block; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
composition, functions and general responsibilities of each committee are
summarized below.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    </div>
    <div>
      <table cellpadding="0" cellspacing="0" width="100%">
          <tr>
            <td valign="top" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="top" width="76%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: times new roman">Audit
      Committee</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
      <div style="DISPLAY: block; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The Audit
Committee consists of Messrs. Kyte (chairperson), Price and Shelton. The Board
has determined that Mr. Price is an audit committee financial expert, and is
independent under rules of the SEC. The Board also believes that Mr. Shelton
meets the independence requirements. The Audit Committee held a total of four
(4) meetings during 2008 and a total of two (2) meetings to date during
2009.</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The Audit
Committee operates under a written charter. The Audit Committee&#8217;s duties include
responsibility for reviewing our accounting practices and audit procedures. In
addition, the Audit Committee has responsibility for reviewing complaints about,
and investigating allegations of, financial impropriety or misconduct. The Audit
Committee works closely with management and our independent auditors. The Audit
Committee also meets with our independent auditors on a quarterly basis,
following completion of their quarterly reviews and annual audit, to review the
results of their work. The Audit Committee also meets with our independent
auditors to approve the annual scope of the audit services to be
performed.</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">As part
of its responsibility, the Audit Committee is responsible for engaging our
independent auditor, as well as pre-approving audit and non-audit services
performed by our independent auditor in order to assure that the provision of
such services does not impair the independent auditor&#8217;s
independence.</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Please
see &#8220;Audit Committee Report&#8221; below, which provides further details of many of
the duties and responsibilities of the Audit Committee.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    </div>
    <div>
      <table cellpadding="0" cellspacing="0" width="100%">
          <tr>
            <td valign="top" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="top" width="76%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: times new roman">Compensation
      Committee, Compensation Committee Interlocks and Insider
      Participation</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
Compensation Committee currently consists of Messrs.&#160;Price (chairperson),
Shelton and Bolio. The Board believes that Messrs. Price, Shelton and Bolio meet
independence requirements.&#160;&#160;None of our executive officers served on
the compensation committee of another entity or on any other committee of the
board of directors of another entity performing similar functions during 2008.
The Compensation Committee held three (3) meetings during 2008 and held one (1)
meeting to date during 2009.</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
Compensation Committee operates under a written charter. The Compensation
Committee establishes the compensation and benefits of our executive officers.
The Compensation Committee also administers our employee benefit plans,
including our 2004 Plan.</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Please
see &#8220;Compensation Committee Report&#8221; below, which details the Compensation
Committee&#8217;s report on our executive compensation for 2008.</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div id="GLFTR" style="WIDTH: 100%" align="left">
          </div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">5</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
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          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="right">
          </div>
        </div>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
    </div>
    <div>
      <table cellpadding="0" cellspacing="0" width="100%">
          <tr>
            <td valign="top" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="top" width="76%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: times new roman">Nominating
      and Corporate Governance Committee</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
Nominating and Corporate Governance Committee currently consists of
Messrs.&#160;Price (chairperson), and Bolio<font style="DISPLAY: inline; FONT-WEIGHT: bold">.&#160;&#160;</font> The Board
believes that Messrs.&#160;Price and Bolio meet&#160;&#160;independence
requirements.&#160;&#160;The Nominating and Corporate Governance Committee held
no meetings during 2008 and 2009.</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
Nominating and Corporate Governance Committee operates under a written charter.
The Nominating and Corporate Governance Committee has the primary responsibility
for overseeing the Company&#8217;s corporate governance compliance practices, as well
as supervising the affairs of the Company as they relate to the nomination of
directors. The principal ongoing functions of the Nominating and Corporate
Governance Committee include developing criteria for selecting new directors,
establishing and monitoring procedures for the receipt and consideration of
director nominations by stockholders and others, considering and examining
director candidates, developing and recommending corporate governance principles
for the Company and monitoring the Company&#8217;s compliance with these principles
and establishing and monitoring procedures for the receipt of stockholder
communications directed to the Board.</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
Nominating and Corporate Governance Committee is also responsible for conducting
an annual evaluation of the Board to determine whether the Board and its
committees are functioning effectively. In performing this evaluation, the
Nominating and Corporate Governance Committee receives comments from all
directors and reports annually to the Board with the results of this
evaluation.</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold">Director
Nominations</font></font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
Nominating and Corporate Governance Committee seeks out appropriate candidates
to serve as directors of the Company, and the Nominating and Corporate
Governance Committee interviews and examines director candidates and makes
recommendations to the Board regarding candidate selection. In considering
candidates to serve as director, the Nominating and Corporate Governance
Committee evaluates various minimum individual qualifications, including
strength of character, maturity of judgment, relevant technical skills or
financial acumen, diversity of viewpoint and industry knowledge, as well as the
extent to which the candidate would fill a present need on the
Board.</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
Nominating and Corporate Governance Committee will consider, without commitment,
stockholder nominations for director. Nominations for director submitted to this
committee by stockholders are evaluated according to the Company&#8217;s overall needs
and the nominee&#8217;s knowledge, experience and background. A nominating stockholder
must give appropriate notice to the Company of the nomination not less than
90&#160;days prior to the first anniversary of the preceding year&#8217;s annual
meeting. In the event that the date of the annual meeting is advanced by more
than 30&#160;days or delayed by more than 60&#160;days from the anniversary date
of the preceding year&#8217;s annual meeting, the notice by the stockholder must be
delivered not later than the close of business on the later of the 60th day
prior to such annual meeting or the tenth day following the day on which public
announcement of the date of such annual meeting is first
made.</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
stockholders&#8217; notice shall set forth, as to:</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    </div>
    <div>
      <table cellpadding="0" cellspacing="0" width="100%">
          <tr>
            <td valign="top" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="top" width="1%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#8226;&#160;</font></div>
            </td>
            <td valign="top" width="75%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">each
      person whom the stockholder proposes to nominate for election as a
      director:</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
    <div>
      <table cellpadding="0" cellspacing="0" width="100%">
          <tr>
            <td colspan="2" valign="top" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="top" width="1%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#8226;&#160;</font></div>
            </td>
            <td valign="top" width="73%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">the
      name, age, business address and residence address of such
      person,</font></div>
            </td>
          </tr>
          <tr>
            <td colspan="2" valign="middle" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="middle" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="middle" width="73%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
          </tr>
          <tr>
            <td colspan="2" valign="top" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="top" width="1%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#8226;&#160;</font></div>
            </td>
            <td valign="top" width="73%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">the
      principal occupation or employment of the person,</font></div>
            </td>
          </tr>
          <tr>
            <td colspan="2" valign="middle" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="middle" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="middle" width="73%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
          </tr>
          <tr>
            <td colspan="2" valign="top" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="top" width="1%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#8226;&#160;</font></div>
            </td>
            <td valign="top" width="73%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">the
      class and number of shares of the Company which are beneficially owned by
      such person, if any,&#160;and</font></div>
            </td>
          </tr>
          <tr>
            <td colspan="2" valign="middle" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="middle" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="middle" width="73%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
          </tr>
          <tr>
            <td colspan="2" valign="top" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="top" width="1%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#8226;&#160;</font></div>
            </td>
            <td valign="top" width="73%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">any
      other information relating to such person which is required to be
      disclosed in solicitations for proxies for election of directors pursuant
      to Regulation&#160;14A under the Exchange Act and the rules
      hereunder;&#160;and</font></div>
            </td>
          </tr>
          <tr>
            <td valign="middle" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="middle" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td colspan="2" valign="middle" width="74%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
          </tr>
          <tr>
            <td valign="top" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="top" width="2%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#8226;&#160;</font></div>
            </td>
            <td colspan="2" valign="top" width="74%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">the
      stockholder giving the notice:</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
    <div>
      <table cellpadding="0" cellspacing="0" width="100%">
          <tr>
            <td valign="top" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="top" width="1%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#8226;&#160;</font></div>
            </td>
            <td valign="top" width="73%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">the
      name and record address of the stockholder and the class and number of
      shares of the Company which are beneficially owned by the
      stockholder,</font></div>
            </td>
          </tr>
          <tr>
            <td valign="middle" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="middle" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="middle" width="73%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
          </tr>
          <tr>
            <td valign="top" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="top" width="1%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#8226;&#160;</font></div>
            </td>
            <td valign="top" width="73%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">a
      description of all arrangements or understandings between such stockholder
      and each proposed nominee and any other person or persons (including their
      names) pursuant to which nomination(s) are to be made by such
      stockholder,</font></div>
            </td>
          </tr>
          <tr>
            <td valign="middle" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="middle" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="middle" width="73%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
          </tr>
          <tr>
            <td valign="top" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="top" width="1%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#8226;&#160;</font></div>
            </td>
            <td valign="top" width="73%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">a
      representation that such stockholder intends to appear in person or by
      proxy at the meeting to nominate the persons named in its
      notice,</font></div>
            </td>
          </tr>
          <tr>
            <td valign="middle" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="middle" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="middle" width="73%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
          </tr>
          <tr>
            <td valign="top" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="top" width="1%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#8226;&#160;</font></div>
            </td>
            <td valign="top" width="73%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">any
      other information relating to such person which is required to be
      disclosed in solicitations for proxies for election of directors pursuant
      to Regulation&#160;14A under the Exchange Act and the rules
      thereunder.</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
notice must be accompanied by a written consent of the proposed nominee to be
named as a director.</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold">DIRECTOR
COMPENSATION</font></font></div>
    </div>
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      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
      <div style="DISPLAY: block; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Our
directors who are not officers or employees of the Company are compensated for
their services in the amount of $1,000 per meeting of the Board plus annual
payments of $7,500 and $25,000 for the Chairman of the Board. In addition, the
chairperson of the Audit Committee receives an annual payment of $20,000 and the
chairpersons of the Compensation and Nominating and Corporate Governance
Committees each receives an annual payment of $15,000...
&#160;&#160;&#160;&#160;&#160;</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold">Recommendation of the
Board</font></font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold">The Board unanimously recommends that
stockholders vote&#160;FOR election of each of the nominees identified
above.</font></font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div id="GLFTR" style="WIDTH: 100%" align="left">
          </div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">6</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="1">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="right">
          </div>
        </div>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">PROPOSAL&#160;2</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">RATIFICATION
OF APPOINTMENT OF INDEPNEDENT AUDITORS</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The Audit
Committee has selected Weinberg&#160;&amp; Company, P.A. to audit our financial
statements for the fiscal year ended December&#160;31, 2008. Although
ratification by stockholders is not required by law, the Board has determined
that it is desirable to request ratification of this selection by the
stockholders. Notwithstanding its selection, the Audit Committee, in its
discretion, may appoint new independent auditors at any time during the year if
the Audit Committee believes that such a change would be in the best interest of
the Company and its stockholders. If the stockholders do not ratify the
appointment of Weinberg&#160;&amp; Company, P.A. the Audit Committee may
reconsider its selection.</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Weinberg&#160;&amp;
Company, P.A. was first appointed in fiscal year 2003, and has audited our
financial statements for fiscal years 2002 through 2008. The Board expects that
representatives of Weinberg&#160;&amp; Company, P.A. will be present at the 2009
Annual Meeting to respond to appropriate questions and to make a statement if
they so desire.</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold">Audit and Other
Fees</font></font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
following table summarizes the fees charged by Weinberg&#160;&amp; Company, P.A.
for certain services rendered to the Company during 2007 and 2008.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    </div>
    <div align="center">
      <div align="justify">
        <div align="justify">
          <div align="justify">
            <div align="justify">
              <div align="justify">
                <div align="justify">
                  <table cellpadding="0" cellspacing="0" width="100%">
                      <tr>
                        <td valign="bottom" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                        <td colspan="6" valign="bottom" style="BORDER-BOTTOM: black 2px solid">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="justify"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Amount
      Billed</font></div>
                        </td>
                      </tr>
                      <tr>
                        <td valign="bottom"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                        <td colspan="6" valign="bottom"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      </tr>
                      <tr>
                        <td valign="bottom" style="PADDING-BOTTOM: 2px">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman; TEXT-DECORATION: underline">Type
      of Fee</font></div>
                        </td>
                        <td colspan="3" valign="bottom" style="BORDER-BOTTOM: black 2px solid">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="justify"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Fiscal
      Year&#160;2007</font></div>
                        </td>
                        <td align="left" nowrap valign="bottom" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td colspan="2" valign="bottom" style="BORDER-BOTTOM: black 2px solid">
                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="justify"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Fiscal
      Year&#160;2008</font></div>
                        </td>
                      </tr>
                      <tr>
                        <td valign="bottom"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                        <td colspan="3" valign="bottom"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" nowrap valign="bottom"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td colspan="2" valign="bottom"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      </tr>
                      <tr bgcolor="#eeeeee">
                        <td valign="bottom" width="62%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: -9pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Audit(1)</font></div>
                        </td>
                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                        <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">193,186</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                        <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">103,850</font></td>
                      </tr>
                      <tr bgcolor="white">
                        <td valign="bottom" width="62%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: -9pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Audit
      Related(2)</font></div>
                        </td>
                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">0</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">0</font></td>
                      </tr>
                      <tr bgcolor="#eeeeee">
                        <td valign="bottom" width="62%">
                          <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: -9pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Tax(3)</font></div>
                        </td>
                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">0</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;0</font></td>
                      </tr>
                      <tr bgcolor="white">
                        <td valign="bottom" width="62%" style="PADDING-BOTTOM: 2px">
                          <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: -9pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">All
      Other(4)</font></div>
                        </td>
                        <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">0</font></td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">0</font></td>
                      </tr>
                      <tr bgcolor="#eeeeee">
                        <td valign="bottom" width="62%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" nowrap valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      </tr>
                      <tr bgcolor="white">
                        <td valign="bottom" width="62%" style="PADDING-LEFT: 1%; PADDING-BOTTOM: 4px">
                          <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: -9pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Total</font></div>
                        </td>
                        <td valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                        <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">193,186</font></td>
                        <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 4px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                        <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></td>
                        <td align="right" valign="bottom" width="9%" style="BORDER-BOTTOM: black 4px double"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">103,850</font></td>
                      </tr>
                  </table>
                </div>
              </div>
            </div>
          </div>
        </div>
      </div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">
        <div>&#160;</div>
      </div>
    </div>
    <div>
      <table cellpadding="0" cellspacing="0" width="100%">
          <tr>
            <td valign="top" width="3%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(1)&#160;</font></div>
            </td>
            <td valign="top" width="75%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">This
      category consists of fees for the audit of our annual financial statements
      included in the Company&#8217;s annual report on Form&#160;10-K and review of
      the financial statements included in the Company&#8217;s quarterly reports on
      Form&#160;10-Q. This category also includes advice on audit and accounting
      matters that arose during, or as a result of, the audit or the review of
      interim financial statements, statutory audits required by
      non-U.S.&#160;jurisdictions and the preparation of an annual &#8220;management
      letter&#8221; on internal control matters.</font></div>
            </td>
          </tr>
          <tr>
            <td valign="middle" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="middle" width="75%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
          </tr>
          <tr>
            <td valign="top" width="3%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(2)&#160;</font></div>
            </td>
            <td valign="top" width="75%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Represents
      services that are normally provided by the independent auditors in
      connection with statutory and regulatory filings or engagements for those
      fiscal years, aggregate fees charged for assurance and related services
      that are reasonably related to the performance of the audit and are not
      reported as audit fees. These services include consultations regarding
      Sarbanes-Oxley Act requirements, various SEC filings and the
      implementation of new accounting requirements.</font></div>
            </td>
          </tr>
          <tr>
            <td valign="middle" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="middle" width="75%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
          </tr>
          <tr>
            <td valign="top" width="3%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(3)&#160;</font></div>
            </td>
            <td valign="top" width="75%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Represents
      aggregate fees charged for professional services for tax compliance and
      preparation, tax consulting and advice, and tax
  planning.</font></div>
            </td>
          </tr>
          <tr>
            <td valign="middle" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="middle" width="75%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
          </tr>
          <tr>
            <td valign="top" width="3%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(4)&#160;</font></div>
            </td>
            <td valign="top" width="75%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Represents
      aggregate fees charged for products and services other than those services
      previously reported.</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
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Required</font></div>
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quorum is present, the affirmative vote of a majority of the shares present and
entitled to vote at the 2009&#160;Annual Meeting will be required to ratify the
appointment of Weinberg&#160;&amp; Company, P.A. as our independent auditors.
Abstentions will have the effect of a vote &#8220;against&#8221; the ratification of
Weinberg&#160;&amp; Company, P.A. as our independent auditors. Broker non-votes
will have no effect on the outcome of the vote.</font></div>
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Board</font></font></div>
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stockholders vote&#160;FOR the proposal to ratify the appointment of
Weinberg&#160;&amp; Co., P.A. as our independent auditor for the fiscal year
ended December&#160;31, 2008.</font></font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
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      <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div id="GLFTR" style="WIDTH: 100%" align="left">
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          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">7</font></div>
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      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
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      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold">SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT</font></font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
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following table sets forth certain information regarding the beneficial
ownership of our common stock as of&#160;&#160;&#160;&#160;March 2, 2009
by:</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">
        <div>
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              <tr>
                <td align="left" valign="top" width="2%" style="PADDING-LEFT: 0pt">
                  <div style="MARGIN-LEFT: 9pt"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></div>
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      person, or group of affiliated persons, known by us to be the beneficial
      owner of more than 5% of the outstanding shares of our common
      stock;</font></div>
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                <td align="left" valign="middle" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                <td valign="middle" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                <td valign="middle" width="75%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
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                <td align="left" valign="top" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                <td valign="top" width="1%">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt; TEXT-ALIGN: right" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#8226;&#160;</font></div>
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                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">each
      of our directors;</font></div>
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              <tr>
                <td align="left" valign="middle" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                <td valign="middle" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                <td valign="middle" width="75%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              </tr>
              <tr>
                <td align="left" valign="top" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                <td valign="top" width="1%">
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      Chief Executive Officer and each of our two other most highly-compensated
      executive officers serving as such as of December&#160;31, 2008 whose
      total annual salary and bonus exceeded $100,000, for services rendered in
      all capacities to the Company (such individuals are hereafter referred to
      as the &#8220;Named Executive Officers&#8221;);&#160;and\</font></div>
                  <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
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      all of our directors and executive officers serving as a
      group.</font></div>
                </td>
              </tr>
          </table>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
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            <tr>
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      Beneficial Owner (1)</font></td>
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              <td valign="bottom" width="13%" style="BORDER-BOTTOM: black 2px solid">
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      of</font></div>
                <div style="TEXT-ALIGN: center"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Common
      Stock</font></div>
                <div style="TEXT-ALIGN: center"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Beneficially Owned
      (2)</font></div>
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              <td align="left" nowrap valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td valign="bottom" width="13%" style="BORDER-BOTTOM: black 2px solid">
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      Beneficially</font></div>
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      (2)</font></div>
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                <div>&#160;</div>
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            </tr>
            <tr>
              <td valign="bottom" width="60%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td valign="bottom" width="13%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td align="left" nowrap valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td valign="bottom" width="13%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td align="left" nowrap valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
            </tr>
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      Officers and Director</font></td>
              <td valign="bottom" width="1%" style="LINE-HEIGHT: 1.25"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td valign="bottom" width="13%" style="LINE-HEIGHT: 1.25"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td align="left" nowrap valign="bottom" width="1%" style="LINE-HEIGHT: 1.25"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td valign="bottom" width="1%" style="LINE-HEIGHT: 1.25"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td valign="bottom" width="13%" style="LINE-HEIGHT: 1.25"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td align="left" nowrap valign="bottom" width="1%" style="LINE-HEIGHT: 1.25"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
            </tr>
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              <td valign="bottom" width="60%" style="LINE-HEIGHT: 1.25">
                <div style="MARGIN-LEFT: 9pt; LINE-HEIGHT: 1.25"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Cecil Bond Kyte,
      Chief Executive Officer, Director (3)</font></div>
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              <td valign="bottom" width="1%" style="LINE-HEIGHT: 1.25"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td align="right" valign="bottom" width="12%" style="LINE-HEIGHT: 1.25">
                <div style="LINE-HEIGHT: 1.25; TEXT-ALIGN: center"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">3,901,748</font></div>
              </td>
              <td align="left" nowrap valign="bottom" width="1%" style="LINE-HEIGHT: 1.25"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td valign="bottom" width="1%" style="LINE-HEIGHT: 1.25"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td align="right" valign="bottom" width="12%" style="LINE-HEIGHT: 1.25">
                <div style="LINE-HEIGHT: 1.25; TEXT-ALIGN: center"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">5.70%</font></div>
              </td>
              <td align="left" nowrap valign="bottom" width="1%" style="LINE-HEIGHT: 1.25">&#160;</td>
            </tr>
            <tr bgcolor="#eeeeee">
              <td valign="bottom" width="60%" style="LINE-HEIGHT: 1.25">
                <div style="MARGIN-LEFT: 9pt; LINE-HEIGHT: 1.25"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Charles R. Blum ,
      President(4)</font></div>
              </td>
              <td valign="bottom" width="1%" style="LINE-HEIGHT: 1.25"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td align="right" valign="bottom" width="12%" style="LINE-HEIGHT: 1.25">
                <div style="LINE-HEIGHT: 1.25; TEXT-ALIGN: center"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">588,679</font></div>
              </td>
              <td align="left" nowrap valign="bottom" width="1%" style="LINE-HEIGHT: 1.25"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td valign="bottom" width="1%" style="LINE-HEIGHT: 1.25"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td align="right" valign="bottom" width="12%" style="LINE-HEIGHT: 1.25">
                <div style="LINE-HEIGHT: 1.25; TEXT-ALIGN: center"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">0.90%</font></div>
              </td>
              <td align="left" nowrap valign="bottom" width="1%" style="LINE-HEIGHT: 1.25">&#160;</td>
            </tr>
            <tr bgcolor="white">
              <td valign="bottom" width="60%" style="LINE-HEIGHT: 1.25">
                <div style="MARGIN-LEFT: 9pt; LINE-HEIGHT: 1.25"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Eugene E. Eichler,
      Chief Financial Officer (5)&#160;</font></div>
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              <td valign="bottom" width="1%" style="LINE-HEIGHT: 1.25"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td align="right" valign="bottom" width="12%" style="LINE-HEIGHT: 1.25">
                <div style="LINE-HEIGHT: 1.25; TEXT-ALIGN: center"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">1,942,556</font></div>
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              <td align="left" nowrap valign="bottom" width="1%" style="LINE-HEIGHT: 1.25"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td valign="bottom" width="1%" style="LINE-HEIGHT: 1.25"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td align="right" valign="bottom" width="12%" style="LINE-HEIGHT: 1.25">
                <div style="LINE-HEIGHT: 1.25; TEXT-ALIGN: center"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2.92%</font></div>
              </td>
              <td align="left" nowrap valign="bottom" width="1%" style="LINE-HEIGHT: 1.25">&#160;</td>
            </tr>
            <tr bgcolor="#eeeeee">
              <td valign="bottom" width="60%" style="LINE-HEIGHT: 1.25">
                <div style="MARGIN-LEFT: 9pt; LINE-HEIGHT: 1.25"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Price, John F. &#8211;
      Director (6)&#160;</font></div>
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              <td valign="bottom" width="1%" style="LINE-HEIGHT: 1.25"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td align="right" valign="bottom" width="12%" style="LINE-HEIGHT: 1.25">
                <div style="LINE-HEIGHT: 1.25; TEXT-ALIGN: center"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">1,022,236</font></div>
              </td>
              <td align="left" nowrap valign="bottom" width="1%" style="LINE-HEIGHT: 1.25"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td valign="bottom" width="1%" style="LINE-HEIGHT: 1.25"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td align="right" valign="bottom" width="12%" style="LINE-HEIGHT: 1.25">
                <div style="LINE-HEIGHT: 1.25; TEXT-ALIGN: center"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">1.56%</font></div>
              </td>
              <td align="left" nowrap valign="bottom" width="1%" style="LINE-HEIGHT: 1.25"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;&#160;</font></td>
            </tr>
            <tr bgcolor="white">
              <td valign="bottom" width="60%" style="LINE-HEIGHT: 1.25">
                <div style="MARGIN-LEFT: 9pt; LINE-HEIGHT: 1.25"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Shelton, Nathan &#8211;
      Director (7)</font></div>
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              <td valign="bottom" width="1%" style="LINE-HEIGHT: 1.25"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td align="right" valign="bottom" width="12%" style="LINE-HEIGHT: 1.25">
                <div style="LINE-HEIGHT: 1.25; TEXT-ALIGN: center"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">368,113</font></div>
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              <td align="left" nowrap valign="bottom" width="1%" style="LINE-HEIGHT: 1.25"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td valign="bottom" width="1%" style="LINE-HEIGHT: 1.25"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td align="right" valign="bottom" width="12%" style="LINE-HEIGHT: 1.25">
                <div style="LINE-HEIGHT: 1.25; TEXT-ALIGN: center"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">.57%</font></div>
              </td>
              <td align="left" nowrap valign="bottom" width="1%" style="LINE-HEIGHT: 1.25">&#160;</td>
            </tr>
            <tr bgcolor="#eeeeee">
              <td valign="bottom" width="60%" style="LINE-HEIGHT: 1.25">
                <div style="MARGIN-LEFT: 9pt; LINE-HEIGHT: 1.25"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Bolio, Steven &#8211;
      Director&#160;</font></div>
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              <td valign="bottom" width="1%" style="LINE-HEIGHT: 1.25"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td align="right" valign="bottom" width="12%" style="LINE-HEIGHT: 1.25">
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              <td valign="bottom" width="1%" style="LINE-HEIGHT: 1.25"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td align="right" valign="bottom" width="12%" style="LINE-HEIGHT: 1.25">
                <div style="LINE-HEIGHT: 1.25; TEXT-ALIGN: center"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">.00%</font></div>
              </td>
              <td align="left" nowrap valign="bottom" width="1%" style="LINE-HEIGHT: 1.25">&#160;</td>
            </tr>
            <tr bgcolor="white">
              <td valign="bottom" width="60%" style="LINE-HEIGHT: 1.25"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td valign="bottom" width="1%" style="LINE-HEIGHT: 1.25"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td align="right" valign="bottom" width="12%" style="LINE-HEIGHT: 1.25"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td align="left" nowrap valign="bottom" width="1%" style="LINE-HEIGHT: 1.25"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td valign="bottom" width="1%" style="LINE-HEIGHT: 1.25"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td align="right" valign="bottom" width="12%" style="LINE-HEIGHT: 1.25"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td align="left" nowrap valign="bottom" width="1%" style="LINE-HEIGHT: 1.25">&#160;</td>
            </tr>
            <tr bgcolor="#eeeeee">
              <td valign="bottom" width="60%" style="LINE-HEIGHT: 1.25"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">All directors and
      executive officers as a group</font></td>
              <td valign="bottom" width="1%" style="LINE-HEIGHT: 1.25"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td align="right" valign="bottom" width="12%" style="LINE-HEIGHT: 1.25">
                <div style="LINE-HEIGHT: 1.25; TEXT-ALIGN: center"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">7,823,332</font></div>
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              <td align="left" nowrap valign="bottom" width="1%" style="LINE-HEIGHT: 1.25"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td valign="bottom" width="1%" style="LINE-HEIGHT: 1.25"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td align="right" valign="bottom" width="12%" style="LINE-HEIGHT: 1.25">
                <div style="LINE-HEIGHT: 1.25; TEXT-ALIGN: center"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">10.82%</font></div>
              </td>
              <td align="left" nowrap valign="bottom" width="1%" style="LINE-HEIGHT: 1.25">&#160;</td>
            </tr>
            <tr bgcolor="white">
              <td valign="bottom" width="60%" style="LINE-HEIGHT: 1.25"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td valign="bottom" width="1%" style="LINE-HEIGHT: 1.25"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td align="right" valign="bottom" width="12%" style="LINE-HEIGHT: 1.25"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td align="left" nowrap valign="bottom" width="1%" style="LINE-HEIGHT: 1.25"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td valign="bottom" width="1%" style="LINE-HEIGHT: 1.25"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td align="right" valign="bottom" width="12%" style="LINE-HEIGHT: 1.25"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td align="left" nowrap valign="bottom" width="1%" style="LINE-HEIGHT: 1.25"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
            </tr>
            <tr bgcolor="#eeeeee">
              <td valign="bottom" width="60%" style="LINE-HEIGHT: 1.25"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Five Percent
      Stockholder</font></td>
              <td valign="bottom" width="1%" style="LINE-HEIGHT: 1.25"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td align="right" valign="bottom" width="12%" style="LINE-HEIGHT: 1.25"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td align="left" nowrap valign="bottom" width="1%" style="LINE-HEIGHT: 1.25"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td valign="bottom" width="1%" style="LINE-HEIGHT: 1.25"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td align="right" valign="bottom" width="12%" style="LINE-HEIGHT: 1.25"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td align="left" nowrap valign="bottom" width="1%" style="LINE-HEIGHT: 1.25"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
            </tr>
            <tr bgcolor="white">
              <td valign="bottom" width="60%" style="LINE-HEIGHT: 1.25">
                <div style="MARGIN-LEFT: 9pt; LINE-HEIGHT: 1.25"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Morale Orchards, LLC
      (8)</font></div>
              </td>
              <td valign="bottom" width="1%" style="LINE-HEIGHT: 1.25"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td align="right" valign="bottom" width="12%" style="LINE-HEIGHT: 1.25">
                <div style="LINE-HEIGHT: 1.25; TEXT-ALIGN: center"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">6,328,642</font></div>
              </td>
              <td align="left" nowrap valign="bottom" width="1%" style="LINE-HEIGHT: 1.25"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td valign="bottom" width="1%" style="LINE-HEIGHT: 1.25"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td align="right" valign="bottom" width="12%" style="LINE-HEIGHT: 1.25">
                <div style="LINE-HEIGHT: 1.25; TEXT-ALIGN: center"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">8.94%</font></div>
              </td>
              <td align="left" nowrap valign="bottom" width="1%" style="LINE-HEIGHT: 1.25">&#160;</td>
            </tr>
            <tr bgcolor="#eeeeee">
              <td valign="bottom" width="60%" style="LINE-HEIGHT: 1.25">
                <div style="MARGIN-LEFT: 9pt; LINE-HEIGHT: 1.25"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Joseph Dell and
      Joette Masry Dell (9)&#160;&#160;</font></div>
              </td>
              <td valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td align="right" valign="bottom" width="12%">
                <div style="TEXT-ALIGN: center"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">3,600,880</font></div>
              </td>
              <td align="left" nowrap valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td align="right" valign="bottom" width="12%">
                <div style="TEXT-ALIGN: center"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">5.24%</font></div>
              </td>
              <td align="left" nowrap valign="bottom" width="1%">&#160;</td>
            </tr>
        </table>
      </div>
      <div>&#160;</div>
    </div>
    <div>
      <table cellpadding="0" cellspacing="0" width="100%">
          <tr>
            <td valign="middle" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="middle" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="middle" width="71%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
          </tr>
          <tr>
            <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td align="left" valign="top" width="3%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;(1)&#160;</font></div>
            </td>
            <td align="left" valign="top" width="71%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Unless
      otherwise indicated, the address of each listed person is c/o&#160;Save
      the World Air, Inc., 235 Tennant Avenue, Morgan Hill, California
      95037</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="middle" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="middle" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="middle" width="71%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
          </tr>
          <tr>
            <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td align="left" valign="top" width="3%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;(2)&#160;</font></div>
            </td>
            <td align="left" valign="top" width="71%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Percentage
      of beneficial ownership is based upon 64,498,834 shares of our common
      stock outstanding as of March 2, 2009. Beneficial ownership is determined
      in accordance with the rules of the SEC and generally includes voting or
      investment power with respect to securities. Shares of common stock
      subject to options and warrants currently exercisable or convertible, or
      exercisable or convertible within 60&#160;days, are deemed outstanding for
      determining the number of shares beneficially owned and for computing the
      percentage ownership of the person holding such options, but are not
      deemed outstanding for computing the percentage ownership of any other
      person. Except as indicated by footnote, and subject to community property
      laws where applicable, the persons named in the table have sole voting and
      investment power with respect to all shares of common stock shown as
      beneficially owned by them.</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
            <td align="left" valign="top" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
            <td align="left" valign="top" width="71%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
          </tr>
          <tr>
            <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
            <td align="left" valign="top" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;(3)</font></td>
            <td align="left" valign="top" width="71%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;Includes
      options to purchase 1,130,000 shares of our common stock exercisable
      currently and warrants&#160;to purchase 521,463 shares of our common
      stock.</font></td>
          </tr>
          <tr>
            <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
            <td align="left" valign="top" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
            <td align="left" valign="top" width="71%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
          </tr>
          <tr>
            <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
            <td align="left" valign="top" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;(4)</font></td>
            <td align="left" valign="top" width="71%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Includes
      options to purchase 588,679 shares of our common stock of which 338,679
      are exercisable&#160;&#160;&#160;currently and 250,000 which will not vest
      until July 25, 2009.</font></td>
          </tr>
          <tr>
            <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
            <td align="left" valign="top" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
            <td align="left" valign="top" width="71%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
          </tr>
          <tr>
            <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
            <td align="left" valign="top" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;(5)</font></td>
            <td align="left" valign="top" width="71%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Includes
      options to purchase 1,371,127 shares of our common stock which are
      exercisable currently.</font></td>
          </tr>
          <tr>
            <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
            <td align="left" valign="top" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
            <td align="left" valign="top" width="71%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
          </tr>
          <tr>
            <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
            <td align="left" valign="top" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;(6)</font></td>
            <td align="left" valign="top" width="71%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Includes
      options to purchase 180,000 shares of our common stock which are
      exercisable currently and warrants to purchase 129,412 shares of our
      common stock.</font></td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">
      <table border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%">
          <tr valign="top" style="LINE-HEIGHT: 1.25;">
            <td style="WIDTH: 9pt">
            </td>
            <td align="right" style="WIDTH: 27pt">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(7)&#160;</font></div>
            </td>
            <td align="left">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">includes
      options to purchase 104,585 shares of our common stock exercisable
      currently and warrants to purchase 71,176 shares of our common
      stock/</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">
      <table border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%">
          <tr valign="top" style="LINE-HEIGHT: 1.25;">
            <td style="WIDTH: 9pt">
            </td>
            <td align="right" style="WIDTH: 27pt">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(8)&#160;</font></div>
            </td>
            <td align="left">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Includes
      warrants owned by Morale Orchards, LLC (&#8220;Morale&#8221;) to purchase 797,794
      shares of our&#160;&#160;&#160;common stock.&#160;&#160;&#160;Jacqueline
      Alexander is the sole owner and manager of Morale.&#160;&#160;Her husband,
      Leodis C. Matthews, has no economic, voting, management or other interest,
      either directly or indirectly, in Morale and disclaims any beneficial
      ownership in the common stock and warrants of the Company held by
      Morale.&#160;&#160;Mr. Matthews, indirectly through his law firm, Leodis
      C. Matthews, APC, owns 2,043,243 shares of common stock of the
      Company.&#160;&#160;Ms. Alexander disclaims any beneficial ownership in
      the common stock of the Company held by Leodis C. Matthews,
      APC...</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">
      <table border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%">
          <tr valign="top" style="LINE-HEIGHT: 1.25;">
            <td style="WIDTH: 9pt">
            </td>
            <td align="right" style="WIDTH: 27pt">
              <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; TEXT-ALIGN: left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(9)&#160;</font></div>
            </td>
            <td align="left">
              <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Includes
      warrants to purchase 551,941 shares of our common
  stock</font></div>
            </td>
          </tr>
      </table>
    </div><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;
</font><br>
    <div id="PGBRK" style="MARGIN-LEFT: 0pt; WIDTH: 100%; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
      <div id="FTR">
        <div id="GLFTR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-SIZE: 8pt; COLOR: #000000; FONT-FAMILY: Times New Roman">&#160;
</font></div>
      </div>
      <div id="PN" style="PAGE-BREAK-AFTER: always">
        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">8</font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
          <hr style="COLOR: black" noshade size="1">
        </div>
      </div>
      <div id="HDR">
        <div id="GLHDR" style="WIDTH: 100%" align="right"><font style="DISPLAY: inline; FONT-SIZE: 8pt; COLOR: #000000; FONT-FAMILY: Times New Roman">&#160;
</font></div>
      </div>
    </div><br>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">EXECUTIVE
COMPENSATION</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
following table sets forth certain information regarding the compensation earned
during the last three fiscal years by the Named Executive Officers:</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Summary
Compensation Table</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
      <div>
        <div align="center">
          <div align="center">
            <div align="center">
              <div align="center">
                <div align="center">
                  <div align="center">
                    <div align="center">
                      <div align="center">
                        <div align="center">
                          <div align="center">
                            <div align="center">
                              <div align="center">
                                <div align="center">
                                  <div align="center">
                                    <div align="center">
                                      <div align="center">
                                        <div align="center">
                                          <div align="center">
                                            <div align="center">
                                              <div align="center">
                                                <div align="center">
                                                  <table cellpadding="0" cellspacing="0" width="100%">
                                                      <tr>
                                                        <td valign="bottom" width="37%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                                                        <td valign="bottom" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                                                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td colspan="9" valign="bottom" width="55%">
                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Long-Term
      Compensation Awards</font></div>
                                                        </td>
                                                      </tr>
                                                      <tr>
                                                        <td valign="bottom" width="37%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                                                        <td valign="bottom" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                                                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td colspan="2" valign="bottom" width="13%">
                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Annual</font></div>
                                                        </td>
                                                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td valign="bottom" width="13%">
                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Restricted</font></div>
                                                        </td>
                                                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td colspan="2" valign="bottom" width="9%">
                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Securities</font></div>
                                                        </td>
                                                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td valign="bottom" width="13%">
                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">All</font></div>
                                                        </td>
                                                      </tr>
                                                      <tr>
                                                        <td valign="bottom" width="37%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                                                        <td valign="bottom" width="6%">
                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Fiscal</font></div>
                                                        </td>
                                                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td colspan="2" valign="bottom" width="13%">
                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Compensation</font></div>
                                                        </td>
                                                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td valign="bottom" width="13%">
                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Stock
      Awards</font></div>
                                                        </td>
                                                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td colspan="2" valign="bottom" width="9%">
                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Underlying</font></div>
                                                        </td>
                                                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td valign="bottom" width="13%">
                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Other</font></div>
                                                        </td>
                                                      </tr>
                                                      <tr>
                                                        <td align="left" valign="bottom" width="37%" style="PADDING-BOTTOM: 2px">
                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Name
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                                                        </td>
                                                        <td valign="bottom" width="6%" style="BORDER-BOTTOM: black 2px solid">
                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Year</font></div>
                                                        </td>
                                                        <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td colspan="2" valign="bottom" width="13%" style="BORDER-BOTTOM: black 2px solid">
                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Salary
      ($)</font></div>
                                                        </td>
                                                        <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td valign="bottom" width="13%" style="BORDER-BOTTOM: black 2px solid">
                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">($)</font></div>
                                                        </td>
                                                        <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td colspan="2" valign="bottom" width="9%" style="BORDER-BOTTOM: black 2px solid">
                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Options
      (#)</font></div>
                                                        </td>
                                                        <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td valign="bottom" width="13%" style="BORDER-BOTTOM: black 2px solid">
                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Compensation
      ($)</font></div>
                                                        </td>
                                                      </tr>
                                                      <tr>
                                                        <td align="left" valign="bottom" width="37%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td align="left" valign="bottom" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td align="left" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td align="left" valign="bottom" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td valign="bottom" width="13%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td align="left" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td align="left" valign="bottom" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td align="left" valign="bottom" width="13%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                      </tr>
                                                      <tr bgcolor="#eeeeee">
                                                        <td align="left" valign="bottom" width="37%">
                                                          <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Cecil
      Bond Kyte, Chairman of the Board (1)</font></div>
                                                        </td>
                                                        <td align="left" valign="bottom" width="6%">
                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2008</font></div>
                                                        </td>
                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td align="left" valign="bottom" width="9%">
                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt; TEXT-ALIGN: right" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;0</font></div>
                                                        </td>
                                                        <td align="left" valign="bottom" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td valign="bottom" width="13%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                                                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td align="left" valign="bottom" width="9%">
                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt; TEXT-ALIGN: right" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">1,100,000</font></div>
                                                        </td>
                                                        <td align="left" valign="bottom" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td align="left" valign="bottom" width="13%">
                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$0</font></div>
                                                        </td>
                                                      </tr>
                                                      <tr bgcolor="white">
                                                        <td valign="bottom" width="37%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                                                        <td valign="bottom" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                                                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                                                        <td valign="bottom" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td valign="bottom" width="13%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                                                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                                                        <td valign="bottom" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td valign="bottom" width="13%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                                                      </tr>
                                                      <tr bgcolor="#eeeeee">
                                                        <td align="left" valign="bottom" width="37%">
                                                          <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Charles
      R. Blum, (2) (4)</font></div>
                                                        </td>
                                                        <td valign="bottom" width="6%">
                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2008</font></div>
                                                        </td>
                                                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td align="left" valign="bottom" width="9%">
                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt; TEXT-ALIGN: right" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$200,000</font></div>
                                                        </td>
                                                        <td align="left" valign="bottom" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;*&#160;</font></td>
                                                        <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td valign="bottom" width="13%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                                                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td valign="bottom" width="9%">
                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt; TEXT-ALIGN: right" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">400,000</font></div>
                                                        </td>
                                                        <td valign="bottom" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td align="left" valign="bottom" width="13%">
                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$0</font></div>
                                                        </td>
                                                      </tr>
                                                      <tr bgcolor="white">
                                                        <td align="left" valign="bottom" width="37%">
                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Chief
      Executive Officer and President</font></div>
                                                        </td>
                                                        <td valign="bottom" width="6%">
                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2007</font></div>
                                                        </td>
                                                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td valign="bottom" width="9%">
                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt; TEXT-ALIGN: right" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$
      87,500</font></div>
                                                        </td>
                                                        <td valign="bottom" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;**</font></td>
                                                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td valign="bottom" width="13%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                                                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td valign="bottom" width="9%">
                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt; TEXT-ALIGN: right" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">188,679</font></div>
                                                        </td>
                                                        <td valign="bottom" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td align="left" valign="bottom" width="13%">
                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$0</font></div>
                                                        </td>
                                                      </tr>
                                                      <tr bgcolor="#eeeeee">
                                                        <td valign="bottom" width="37%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                                                        <td valign="bottom" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                                                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                                                        <td valign="bottom" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td valign="bottom" width="13%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                                                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                                                        <td valign="bottom" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td valign="bottom" width="13%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                                                      </tr>
                                                      <tr bgcolor="white">
                                                        <td align="left" valign="bottom" width="37%">
                                                          <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Eugene
      E. Eichler (3) (4)</font></div>
                                                        </td>
                                                        <td valign="bottom" width="6%">
                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2008</font></div>
                                                        </td>
                                                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td valign="bottom" width="9%">
                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt; TEXT-ALIGN: right" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$&#160;90,000</font></div>
                                                        </td>
                                                        <td valign="bottom" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;***</font></td>
                                                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td valign="bottom" width="13%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                                                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td valign="bottom" width="9%">
                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt; TEXT-ALIGN: right" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">0</font></div>
                                                        </td>
                                                        <td valign="bottom" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td align="left" valign="bottom" width="13%">
                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$0</font></div>
                                                        </td>
                                                      </tr>
                                                      <tr bgcolor="#eeeeee">
                                                        <td align="left" valign="bottom" width="37%">
                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Chief
      Executive Officer Chief Financial Officer</font></div>
                                                        </td>
                                                        <td valign="bottom" width="6%">
                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2007</font></div>
                                                        </td>
                                                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td valign="bottom" width="9%">
                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt; TEXT-ALIGN: right" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">0</font></div>
                                                        </td>
                                                        <td valign="bottom" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td valign="bottom" width="13%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                                                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td valign="bottom" width="9%">
                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt; TEXT-ALIGN: right" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">0</font></div>
                                                        </td>
                                                        <td valign="bottom" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td align="left" valign="bottom" width="13%">
                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$0</font></div>
                                                        </td>
                                                      </tr>
                                                      <tr bgcolor="white">
                                                        <td valign="bottom" width="37%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                                                        <td valign="bottom" width="6%">
                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2006</font></div>
                                                        </td>
                                                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td valign="bottom" width="9%">
                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt; TEXT-ALIGN: right" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$300,000</font></div>
                                                        </td>
                                                        <td valign="bottom" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td valign="bottom" width="13%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                                                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td valign="bottom" width="9%">
                                                          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt; TEXT-ALIGN: right" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">0</font></div>
                                                        </td>
                                                        <td valign="bottom" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                        <td valign="bottom" width="13%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                                                      </tr>
                                                  </table>
                                                </div>
                                              </div>
                                            </div>
                                          </div>
                                        </div>
                                      </div>
                                    </div>
                                  </div>
                                </div>
                              </div>
                            </div>
                          </div>
                        </div>
                      </div>
                    </div>
                  </div>
                </div>
              </div>
            </div>
          </div>
        </div>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
    </div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">
      <table border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%">
          <tr valign="top" style="LINE-HEIGHT: 1.25;">
            <td align="right" style="WIDTH: 27pt">
              <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; TEXT-ALIGN: left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">*&#160;</font></div>
            </td>
            <td align="left">
              <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
      2008 Mr. Blum was paid $158,333 and $41,667 was accrued and unpaid at
      December 31, 2008.</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">
        <table border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%">
            <tr valign="top">
              <td align="right" style="WIDTH: 27pt">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">**&#160;</font></div>
              </td>
              <td align="left">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
      2007, Mr. Blum was paid $12,500 and $75,000 was accrued and unpaid at
      December 31, 2008.</font></div>
              </td>
            </tr>
        </table>
      </div>
    </div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">
      <table border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%">
          <tr valign="top" style="LINE-HEIGHT: 1.25;">
            <td align="right" style="WIDTH: 27pt">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold">***</font></font></div>
            </td>
            <td align="left">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;In
      2008, Mr. Eichler was paid $40,000 and $50,000 was accrued and unpaid at
      December 31, 2008...</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" width="100%">
          <tr>
            <td valign="top" width="2%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(1)&#160;</font></div>
            </td>
            <td valign="top" width="76%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Mr.
      Kyte was appointed Chief Executive Officer on January 30, 2009 at an
      annual compensation of $200,000.</font></div>
            </td>
          </tr>
          <tr>
            <td valign="middle" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="middle" width="76%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
          </tr>
          <tr>
            <td valign="top" width="2%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(2)&#160;</font></div>
            </td>
            <td valign="top" width="76%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;Mr.
      Blum was appointed Chief Executive Officer and President on July 25, 2007.
      On January 30, 2009, Mr. Blum resigned as Chief Executive Officer but
      continues to serve as President at an annual salary of
      $100,000.</font></div>
            </td>
          </tr>
          <tr>
            <td valign="middle" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="middle" width="76%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
          </tr>
          <tr>
            <td valign="top" width="2%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(3)</font></div>
            </td>
            <td valign="top" width="76%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Mr.&#160;Eichler
      was appointed Chief Operating Officer, Chief Financial Officer and
      Treasurer in October 2001. In March 2004, Mr.&#160;Eichler relinquished
      his position as Chief Operating Officer, and was appointed President of
      the Company, a position he held until November 2005, when he assumed the
      position of Chief Executive Officer, and he continued to serve as Chief
      Financial Officer.&#160;&#160;On November 20, 2006, Mr. Eichler resigned,
      due to disability, the position of Chief Executive Officer and on January
      5, 2007 he resigned as Chief Financial Officer.&#160;&#160;On October 18,
      2007, Mr. Eichler was appointed Interim Chief Financial Officer without
      compensation.&#160;&#160;Effective April 1, 2008, Mr. Eichler received a
      salary of $10,000 per month.</font></div>
            </td>
          </tr>
          <tr>
            <td valign="middle" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="middle" width="76%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
          </tr>
          <tr>
            <td valign="top" width="2%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(4)&#160;</font></div>
            </td>
            <td valign="top" width="76%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">The
      number and value of vested restricted stock based upon the closing market
      price of the common stock at December&#160;30, 2008 ($0.40) were as
      follows: Mr. Kyte 1,771,461 vested shares valued at $708,584 and
      Mr.&#160;Eichler, 571,429 vested shares valued at $228,572.</font></div>
              <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
              <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
              <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
    <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
      <div id="FTR">
        <div id="GLFTR" style="WIDTH: 100%" align="left">
        </div>
      </div>
      <div id="PN" style="PAGE-BREAK-AFTER: always">
        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">9</font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
          <hr style="COLOR: black" noshade size="1">
        </div>
      </div>
      <div id="HDR">
        <div id="GLHDR" style="WIDTH: 100%" align="right">
        </div>
      </div>
    </div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">OPTION
GRANTS IN LAST FISCAL YEAR</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"><br>
      <div style="DISPLAY: block; TEXT-INDENT: 27pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
following table sets forth information concerning the stock option grants made
to each of the Named Executive Officers during the 2008 fiscal year. No stock
appreciation rights were granted to any of the Named Executive Officers during
the 2008 fiscal year.</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">
      <div>
        <div align="center">
          <div align="center">
            <div align="center">
              <div align="center">
                <div align="center">
                  <div align="center">
                    <div align="center">
                      <div align="center">
                        <div align="center">
                          <div align="center">
                            <div align="center">
                              <div align="center">
                                <div align="center">
                                  <div align="center">
                                    <div align="center">
                                      <div align="center">
                                        <div align="center">
                                          <div align="center">
                                            <div align="center">
                                              <table cellpadding="0" cellspacing="0" width="100%">
                                                  <tr>
                                                    <td valign="bottom" width="35%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                                                    <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                    <td colspan="7" valign="bottom" width="63%" style="BORDER-BOTTOM: black 2px solid">
                                                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Individual
      Grants</font></div>
                                                    </td>
                                                  </tr>
                                                  <tr>
                                                    <td valign="bottom" width="35%" style="PADDING-BOTTOM: 2px">
                                                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Name</font></div>
                                                    </td>
                                                    <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                    <td valign="bottom" width="15%" style="BORDER-BOTTOM: black 2px solid">
                                                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Number
      of</font></div>
                                                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Securities</font></div>
                                                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Underlying</font></div>
                                                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Options</font></div>
                                                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Granted</font></div>
                                                    </td>
                                                    <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                    <td valign="bottom" width="15%" style="BORDER-BOTTOM: black 2px solid">
                                                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Percent
      of</font></div>
                                                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Total
      Options</font></div>
                                                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Granted
      to</font></div>
                                                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Employees
      in</font></div>
                                                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Fiscal
      2008</font></div>
                                                    </td>
                                                    <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                    <td valign="bottom" width="15%" style="BORDER-BOTTOM: black 2px solid">
                                                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Exercise
      or</font></div>
                                                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Base
      Price</font></div>
                                                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Per
      Share</font></div>
                                                    </td>
                                                    <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                    <td valign="bottom" width="15%" style="BORDER-BOTTOM: black 2px solid">
                                                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Expiration</font></div>
                                                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Date</font></div>
                                                    </td>
                                                  </tr>
                                                  <tr bgcolor="#eeeeee">
                                                    <td align="left" valign="top" width="35%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                    <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                    <td align="left" valign="top" width="15%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                    <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                    <td align="left" valign="top" width="15%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                    <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                    <td align="left" valign="top" width="15%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                    <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                    <td align="left" valign="top" width="15%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  </tr>
                                                  <tr bgcolor="white">
                                                    <td align="left" valign="top" width="35%">
                                                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Cecil
      Bond Kyte</font></div>
                                                    </td>
                                                    <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                    <td align="left" valign="top" width="15%">
                                                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">1,100,000</font></div>
                                                    </td>
                                                    <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                    <td align="left" valign="top" width="15%">
                                                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">40.7%</font></div>
                                                    </td>
                                                    <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                    <td align="left" valign="top" width="15%">
                                                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$0.27</font></div>
                                                    </td>
                                                    <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                    <td align="left" valign="top" width="15%">
                                                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">9/24/18</font></div>
                                                    </td>
                                                  </tr>
                                                  <tr bgcolor="#eeeeee">
                                                    <td align="left" valign="top" width="35%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                    <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                    <td align="left" valign="top" width="15%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                    <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                    <td align="left" valign="top" width="15%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                    <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                    <td align="left" valign="top" width="15%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                    <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                    <td align="left" valign="top" width="15%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  </tr>
                                                  <tr bgcolor="white">
                                                    <td align="left" valign="top" width="35%">
                                                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Charles
      R. Blum</font></div>
                                                    </td>
                                                    <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                    <td align="left" valign="top" width="15%">
                                                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">250,000</font></div>
                                                    </td>
                                                    <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                    <td align="left" valign="top" width="15%">
                                                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">9.3%</font></div>
                                                    </td>
                                                    <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                    <td align="left" valign="top" width="15%">
                                                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$0.40</font></div>
                                                    </td>
                                                    <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                    <td align="left" valign="top" width="15%">
                                                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">7/25/18</font></div>
                                                    </td>
                                                  </tr>
                                                  <tr bgcolor="#eeeeee">
                                                    <td align="left" valign="top" width="35%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                    <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                    <td align="left" valign="top" width="15%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                    <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                    <td align="left" valign="top" width="15%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                    <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                    <td align="left" valign="top" width="15%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                    <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                    <td align="left" valign="top" width="15%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                  </tr>
                                                  <tr bgcolor="white">
                                                    <td align="left" valign="top" width="35%">
                                                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Charles
      R. Blum</font></div>
                                                    </td>
                                                    <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                    <td align="left" valign="top" width="15%">
                                                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">150,000</font></div>
                                                    </td>
                                                    <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                    <td align="left" valign="top" width="15%">
                                                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">5.6%</font></div>
                                                    </td>
                                                    <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                    <td align="left" valign="top" width="15%">
                                                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$0.27</font></div>
                                                    </td>
                                                    <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                    <td align="left" valign="top" width="15%">
                                                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">9/24/18</font></div>
                                                    </td>
                                                  </tr>
                                              </table>
                                            </div>
                                          </div>
                                        </div>
                                      </div>
                                    </div>
                                  </div>
                                </div>
                              </div>
                            </div>
                          </div>
                        </div>
                      </div>
                    </div>
                  </div>
                </div>
              </div>
            </div>
          </div>
        </div>
      </div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold">AGGREGATED OPTION EXERCISES IN LAST
FISCAL YEAR</font></font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold">AND YEAR-END OPTION
VALUES</font></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">No
options were exercised by any of the Named Executive Officers during the 2008
fiscal year. No stock appreciation rights were exercised by any of the Named
Executive Officers during the 2008 fiscal year. The following table sets forth
the number of shares of our common stock subject to exercisable and
unexercisable stock options which the Named Executive Officers held at the end
of the 2008 fiscal year.</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">
        <div>
          <div align="center">
            <div align="center">
              <div align="center">
                <div align="center">
                  <div align="center">
                    <div align="center">
                      <div align="center">
                        <div align="center">
                          <div align="center">
                            <div align="center">
                              <div align="center">
                                <div align="center">
                                  <div align="center">
                                    <div align="center">
                                      <div align="center">
                                        <div align="center">
                                          <div align="center">
                                            <div align="center">
                                              <div align="center">
                                                <table cellpadding="0" cellspacing="0" width="100%">
                                                    <tr>
                                                      <td valign="bottom" width="20%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                                                      <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                      <td valign="bottom" width="10%" style="PADDING-BOTTOM: 2px">
                                                        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Shares</font></div>
                                                        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Acquired
      on</font></div>
                                                      </td>
                                                      <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                      <td valign="bottom" width="10%" style="PADDING-BOTTOM: 2px">
                                                        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Value</font></div>
                                                        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Realized</font></div>
                                                      </td>
                                                      <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                      <td colspan="3" valign="bottom" width="27%" style="BORDER-BOTTOM: black 2px solid">
                                                        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Number
      of Securities</font></div>
                                                        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Underlying
      Unexercised</font></div>
                                                        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Options
      at</font></div>
                                                        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Fiscal
      Year-End (#)</font></div>
                                                      </td>
                                                      <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                      <td colspan="3" valign="bottom" width="27%" style="BORDER-BOTTOM: black 2px solid">
                                                        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Value
      of Unexercised</font></div>
                                                        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">In-the-Money
      Options ($)(1)</font></div>
                                                      </td>
                                                    </tr>
                                                    <tr>
                                                      <td valign="bottom" width="20%" style="BORDER-BOTTOM: black 2px solid">
                                                        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Name</font></div>
                                                      </td>
                                                      <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                      <td valign="bottom" width="10%" style="BORDER-BOTTOM: black 2px solid">
                                                        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Exercise
      (#)</font></div>
                                                      </td>
                                                      <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                      <td valign="bottom" width="10%" style="BORDER-BOTTOM: black 2px solid">
                                                        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">($)</font></div>
                                                      </td>
                                                      <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                      <td valign="bottom" width="13%" style="BORDER-BOTTOM: black 2px solid">
                                                        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Exercisable</font></div>
                                                      </td>
                                                      <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                      <td valign="bottom" width="13%" style="BORDER-BOTTOM: black 2px solid">
                                                        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Unexercisable</font></div>
                                                      </td>
                                                      <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                      <td valign="bottom" width="13%" style="BORDER-BOTTOM: black 2px solid">
                                                        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Exercisable</font></div>
                                                      </td>
                                                      <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                      <td valign="bottom" width="13%" style="BORDER-BOTTOM: black 2px solid">
                                                        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Unexercisable</font></div>
                                                      </td>
                                                    </tr>
                                                    <tr bgcolor="#eeeeee">
                                                      <td align="left" valign="top" width="20%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                      <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                      <td valign="top" width="10%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                      <td valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                      <td valign="top" width="10%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                      <td valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                      <td align="left" valign="top" width="13%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                      <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                      <td align="left" valign="top" width="13%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                      <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                      <td align="left" valign="top" width="13%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                      <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                      <td align="left" valign="top" width="13%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                    </tr>
                                                    <tr bgcolor="white">
                                                      <td align="left" valign="top" width="20%">
                                                        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Cecil
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                                                      </td>
                                                      <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                      <td valign="top" width="10%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                                                      <td valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                      <td valign="top" width="10%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                                                      <td valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                      <td align="left" valign="top" width="13%">
                                                        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">1,130,000</font></div>
                                                      </td>
                                                      <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                      <td align="left" valign="top" width="13%">
                                                        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">0</font></div>
                                                      </td>
                                                      <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                      <td align="left" valign="top" width="13%">
                                                        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$
      143,000</font></div>
                                                      </td>
                                                      <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                      <td align="left" valign="top" width="13%">
                                                        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$
      0</font></div>
                                                      </td>
                                                    </tr>
                                                    <tr bgcolor="#eeeeee">
                                                      <td valign="top" width="20%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                                                      <td valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                      <td valign="top" width="10%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                                                      <td valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                      <td valign="top" width="10%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                                                      <td valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                      <td valign="top" width="13%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                                                      <td valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                      <td valign="top" width="13%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                                                      <td valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                      <td valign="top" width="13%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                                                      <td valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                      <td valign="top" width="13%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                                                    </tr>
                                                    <tr bgcolor="white">
                                                      <td align="left" valign="top" width="20%">
                                                        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Charles
      R. Blum</font></div>
                                                      </td>
                                                      <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                      <td valign="top" width="10%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                                                      <td valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                      <td valign="top" width="10%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                                                      <td valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                      <td align="left" valign="top" width="13%">
                                                        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">338,679</font></div>
                                                      </td>
                                                      <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                      <td align="left" valign="top" width="13%">
                                                        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">250,000</font></div>
                                                      </td>
                                                      <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                      <td align="left" valign="top" width="13%">
                                                        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$&#160;&#160;19,500</font></div>
                                                      </td>
                                                      <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                      <td align="left" valign="top" width="13%">
                                                        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$
      0</font></div>
                                                      </td>
                                                    </tr>
                                                    <tr bgcolor="#eeeeee">
                                                      <td valign="top" width="20%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                                                      <td valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                      <td valign="top" width="10%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                                                      <td valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                      <td valign="top" width="10%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                                                      <td valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                      <td valign="top" width="13%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                                                      <td valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                      <td valign="top" width="13%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                                                      <td valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                      <td valign="top" width="13%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                                                      <td valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                      <td valign="top" width="13%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                                                    </tr>
                                                    <tr bgcolor="white">
                                                      <td align="left" valign="top" width="20%">
                                                        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Eugene
      E. Eichler</font></div>
                                                      </td>
                                                      <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                      <td valign="top" width="10%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                                                      <td valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                      <td valign="top" width="10%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                                                      <td valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                      <td align="left" valign="top" width="13%">
                                                        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">1,371,127</font></div>
                                                      </td>
                                                      <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                      <td align="left" valign="top" width="13%">
                                                        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">0</font></div>
                                                      </td>
                                                      <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                      <td align="left" valign="top" width="13%">
                                                        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">0</font></div>
                                                      </td>
                                                      <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                                      <td align="left" valign="top" width="13%">
                                                        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$
      0</font></div>
                                                      </td>
                                                    </tr>
                                                </table>
                                              </div>
                                            </div>
                                          </div>
                                        </div>
                                      </div>
                                    </div>
                                  </div>
                                </div>
                              </div>
                            </div>
                          </div>
                        </div>
                      </div>
                    </div>
                  </div>
                </div>
              </div>
            </div>
          </div>
        </div>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" width="100%">
          <tr>
            <td valign="middle" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="middle" width="75%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
          </tr>
          <tr>
            <td valign="top" width="3%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(1)&#160;</font></div>
            </td>
            <td valign="top" width="75%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Market
      value of our common stock at fiscal year-end minus the exercise price. The
      closing price of our common stock on December&#160;30, 2008, the last
      trading day of the year, was $0.40&#160;per share.</font></div>
            </td>
          </tr>
          <tr>
            <td valign="top" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="top" width="75%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div id="GLFTR" style="WIDTH: 100%" align="left">
          </div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">10</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="1">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="right">
          </div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold">EQUITY COMPENSATION PLAN INFORMATION
FOR 2008</font></font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;The
following table sets forth information regarding outstanding options and shares
reserved for future issuance under our equity compensation plans as of
December&#160;31, 2008:</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">
        <div>
          <div align="center">
            <div align="center">
              <div align="center">
                <div align="center">
                  <div align="center">
                    <div align="center">
                      <div align="center">
                        <div align="center">
                          <div align="center">
                            <div align="center">
                              <div align="center">
                                <div align="center">
                                  <div align="center">
                                    <table cellpadding="0" cellspacing="0" width="100%">
                                        <tr>
                                          <td valign="bottom" width="46%" style="BORDER-BOTTOM: black 2px solid">
                                            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Plan
      Category</font></div>
                                          </td>
                                          <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                          <td valign="bottom" width="11%" style="BORDER-BOTTOM: black 2px solid">
                                            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Number
      of Securities</font></div>
                                            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">to
      be Issued upon</font></div>
                                            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Exercise
      of</font></div>
                                            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Outstanding
      Options,</font></div>
                                            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Warrants
      and Rights</font></div>
                                          </td>
                                          <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                          <td valign="bottom" width="11%" style="BORDER-BOTTOM: black 2px solid">
                                            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Weighted-Average</font></div>
                                            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Exercise
      Price of</font></div>
                                            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Outstanding
      Options,</font></div>
                                            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Warrants
      and Rights</font></div>
                                          </td>
                                          <td valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                          <td valign="bottom" width="12%" style="BORDER-BOTTOM: black 2px solid">
                                            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Number
      of Securities</font></div>
                                            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Remaining
      Available</font></div>
                                            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">for
      Future Issuance</font></div>
                                            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Under
      Equity</font></div>
                                            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Compensation
      Plans</font></div>
                                            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(Excluding
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                                            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Reflected
      in the</font></div>
                                            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">First
      Column)</font></div>
                                          </td>
                                        </tr>
                                        <tr bgcolor="#eeeeee">
                                          <td valign="top" width="46%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                                          <td valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                          <td valign="top" width="11%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                                          <td valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                          <td valign="top" width="11%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                                          <td valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                          <td valign="top" width="12%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                                        </tr>
                                        <tr bgcolor="white">
                                          <td align="left" valign="top" width="46%">
                                            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Equity
      compensation plans approved by security holders</font></div>
                                          </td>
                                          <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                          <td align="left" valign="top" width="11%">
                                            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">4,351,225</font></div>
                                          </td>
                                          <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                          <td align="left" valign="top" width="11%">
                                            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$0.54</font></div>
                                          </td>
                                          <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                          <td align="left" valign="top" width="12%">
                                            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2,648,775</font></div>
                                          </td>
                                        </tr>
                                        <tr bgcolor="#eeeeee">
                                          <td valign="top" width="46%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                                          <td valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                          <td valign="top" width="11%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                                          <td valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                          <td valign="top" width="11%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                                          <td valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                          <td valign="top" width="12%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                                        </tr>
                                        <tr bgcolor="white">
                                          <td align="left" valign="top" width="46%">
                                            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Equity
      compensation plans not approved by security holders</font></div>
                                          </td>
                                          <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                          <td align="left" valign="top" width="11%">
                                            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">250,000</font></div>
                                          </td>
                                          <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                          <td align="left" valign="top" width="11%">
                                            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$0.40</font></div>
                                          </td>
                                          <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                          <td align="left" valign="top" width="12%">
                                            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">N/A</font></div>
                                          </td>
                                        </tr>
                                        <tr bgcolor="#eeeeee">
                                          <td valign="top" width="46%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                                          <td valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                          <td valign="top" width="11%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                                          <td valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                          <td valign="top" width="11%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                                          <td valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                          <td valign="top" width="12%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                                        </tr>
                                        <tr bgcolor="white">
                                          <td align="left" valign="top" width="46%">
                                            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Total</font></div>
                                          </td>
                                          <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                          <td align="left" valign="top" width="11%">
                                            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">4,601,225</font></div>
                                          </td>
                                          <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                          <td align="left" valign="top" width="11%">
                                            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$0.53</font></div>
                                          </td>
                                          <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                                          <td align="left" valign="top" width="12%">
                                            <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">N/A</font></div>
                                          </td>
                                        </tr>
                                    </table>
                                  </div>
                                </div>
                              </div>
                            </div>
                          </div>
                        </div>
                      </div>
                    </div>
                  </div>
                </div>
              </div>
            </div>
          </div>
        </div>
      </div>
    </div>
    <div align="center">&#160;</div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">EMPLOYMENT
AGREEMENTS</font><br></div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-STYLE: italic">Agreement with
Cecil Bond Kyte. </font>On January 30, 2009, the Company entered into an
employment agreement with Cecil Bond Kyte, pursuant to which se serves as our
Chief Executive Officer.&#160;&#160;The initial term of the agreement became
effective on January 30, 2009 and expires on January 30, 2010 and renews
automatically for addition one-year periods unless either party has given notice
of non-extension prior to October 30, 2009.&#160;&#160;The agreement provides
for a base compensation of $200,000 per year.&#160;&#160;Mr. Kyte is eligible to
participate in the Company&#8217;s incentive and benefit plans, including eligibility
to receive grants of stock options under the 2004 plan.</font></div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font>Mr. Kyte shall be eligible to receive
an annual cash bonus in an amount equal to 2% of the Company&#8217;s net profit, if
any, for its most recently completed fiscal year, computed in accordance with
generally accepted accounting principles applied consistently with prior
periods.&#160;&#160;The bonus shall be payable, if at all, on the anniversary
date of employment each year of the term; provided that no bonus shall be paid
if the Executive is not, on such payment date, in the employ of the
Company.</font></div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font>Mr. Kyte shall also receive an option
(the &#8220;Option&#8221;) to purchase a number of shares (the &#8220;Option Shares&#8221;) of the
Company&#8217;s common stock equal to the result of (A) 100,000 divided by (B) the
closing price per share of the Company&#8217;s Common Stock on the first anniversary
of the Effective Date.&#160;&#160;The Option shall be an incentive stock option,
shall be exercisable at the closing price per share on the first anniversary of
the Effective Date, shall be exercisable for ten years from the date of grant
and shall vest on the second anniversary of the Effective Date.</font></div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
    <div style="DISPLAY: block; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Termination
of Mr. Kyte&#8217;s contract will terminate upon his death or disability and may be
terminated by the Company with or without cause and may be voluntarily
terminated by Mr. Kyte.&#160;&#160;Termination of Mr. Kyte&#8217;s employment for any
reason shall be effective upon the Date of Termination and he shall only be
entitled to receive the compensation accrued through the Date of
Termination.&#160;&#160;In the event of Involuntary Termination, involving
merger, consolidation or sale or disposition of all of the Company&#8217;s assets, Mr.
Kyte shall be entitled to receive (i) all comp9ensation that has accrued through
the date of termination, plus, (ii) a severance payment equal to one year&#8217;s
compensation, plus he shall be entitled to continue to participate in the
Company&#8217;s employee benefit programs offered to other senior management employees
of the Company for a period of 12 months following the date of termination,
provided that if at any time while the Company is required to pay severance to
Mr. Kyte, his death or disability would cause the severance payments to
terminate.</font></div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
    <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
      <div id="FTR">
        <div id="GLFTR" style="WIDTH: 100%" align="left">
        </div>
      </div>
      <div id="PN" style="PAGE-BREAK-AFTER: always">
        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">11</font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
          <hr style="COLOR: black" noshade size="1">
        </div>
      </div>
      <div id="HDR">
        <div id="GLHDR" style="WIDTH: 100%" align="right">
        </div>
      </div>
    </div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-STYLE: italic">Agreement with
Charles R. Blum. </font>On July 18, 2007, the Company entered into an employment
agreement with Charles R. Blum, pursuant to which se serves as our President and
Chief Executive Officer.&#160;&#160;The initial term of the agreement became
effective on July 25, 2007 and expires on July 25, 2008 and renews automatically
for addition one-year periods unless either party has given notice of
non-extension prior to April 30, 2008.&#160;&#160;The agreement provides for a
base compensation of $200,000 per year.&#160;&#160;Mr. Blum is eligible to
participate in the Company&#8217;s incentive and benefit plans, including eligibility
to receive grants of stock options under the 2004 plan.</font></div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font>Mr. Blum shall be eligible to receive
an annual cash bonus in an amount equal to 2% of the Company&#8217;s net profit, if
any, for its most recently completed fiscal year, computed in accordance with
generally accepted accounting principles applied consistently with prior
periods.&#160;&#160;The Bonus shall be payable, if at all, on the anniversary
date of employment each year of the term; provided that no bonus shall be paid
if the Executive is not, on such payment date, in the employ of the
Company.</font></div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font>Mr. Blum shall also receive (i) an
option (the &#8220;Initial Option&#8221;) to purchase 188,679 shares (the &#8220;Initial Option
Shares&#8221;) of the Company&#8217;s common stock.&#160;&#160;The Initial Option shall be
an incentive stock option, shall be exercisable at $0.53 per share, shall be
exercisable for ten years from the date of grant and shall vest on the first
anniversary of the Effective Date; and (ii) an option (the &#8220;Supplemental
Option&#8221;) to purchase a number of shares (the &#8220;Supplemental Option Shares&#8221;) of
the Company&#8217;s common stock equal to the result of (A) 100,000 divided by (B) the
closing price per share of the Company&#8217;s Common Stock on the first anniversary
of the Effective Date.&#160;&#160;The Supplemental Option shall be an incentive
stock option, shall be exercisable at the closing price per share on the first
anniversary of the Effective Date, shall be exercisable for ten years from the
date of grant and shall vest on the second anniversary of the Effective
Date.</font></div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
    <div style="DISPLAY: block; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Termination
of Mr. Blum&#8217;s contract will terminate upon his death or disability and may be
terminated by the Company with or without cause and may be voluntarily
terminated by Mr. Blum.&#160;&#160;Termination of Mr. Blum&#8217;s employment for any
reason shall be effective upon the Date of Termination and he shall only be
entitled to receive the compensation accrued through the Date of
Termination.&#160;&#160;In the event of Involuntary Termination, involving
merger, consolidation or sale or disposition of all of the Company&#8217;s assets, Mr.
Blum shall be entitled to receive (i) all comp9ensation that has accrued through
the date of termination, plus, (ii) a severance payment equal to one year&#8217;s
compensation, plus he shall be entitled to continue to participate in the
Company&#8217;s employee benefit programs offered to other senior management employees
of the Company for a period of 12 months following the date of termination,
provided that if at any time while the Company is required to pay severance to
Mr. Blum, his death or disability would cause the severance payments to
terminate.</font></div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font>On January 30, 2009, Mr. Blum resigned
his position as Chief Executive Officer.&#160;&#160;He continues to serve as
President of the Company at a salary of $100,000 per year.</font></div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
    <div style="DISPLAY: block; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-STYLE: italic">Agreement with
Eugene E. Eichler.</font> On December&#160;1, 2003, the Company entered into an
employment agreement with Eugene E. Eichler, pursuant to which he originally
served as our Chief Operating Officer. Effective March&#160;2, 2004,
Mr.&#160;Eichler has served as our President and Chief Financial Officer and his
employment agreement was amended accordingly. The initial term of the agreement
expires on December&#160;31, 2007 and renews automatically for additional
one-year terms unless either party has given notice of non-extension prior to
the end of a term. Under the agreement, as amended, Mr.&#160;Eichler was paid
base compensation of $192,000&#160;per annum through March&#160;1, 2004 and
$240,000&#160;per annum effective March&#160;2, 2004.&#160;&#160;On October 5,
2005, Mr. Eichler resigned as President and was appointed Chief Executive
Officer at a base compensation of $300,000 per annum through December 2007. The
base compensation is reviewable by the Board in subsequent years of the term.
Mr.&#160;Eichler is also eligible to participate in the Company&#8217;s incentive and
benefit plans, including eligibility to receive grants of stock options under
the 2004 Plan.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
      <div style="DISPLAY: block; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">If
Mr.&#160;Eichler&#8217;s employment is terminated by us without cause or as a result
of his disability or death, he or his estate, as the case may be, will be
entitled to receive an amount equal to the greater of (i)&#160;his highest base
compensation paid to him with respect to one of the two years immediately
preceding the year in which the termination occurs or (ii)&#160;his base
compensation in effect immediately prior to the date of termination, for a
period of one year beginning on the date of termination. In addition, he will be
entitled to receive an amount equal to the greater of the aggregate bonus(es),
if any, paid to him with respect to one of the two years immediately preceding
the year in which the termination occurs. Mr.&#160;Eichler and his dependents
will be entitled to continue to participate at the same levels in the Company&#8217;s
benefit plans for a period of one year.</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On
November 9, 2007, Mr. Eichler and the Company executed a Separation Agreement
whereby on November 20, 2006 Mr. Eichler resigned as Chief Executive Officer and
as Chief Financial Officer effective upon the appointment of his successor, but
in no event later than January 31, 2007.&#160;&#160;His resignations were due to
medical disability. Under the terms of the Separation Agreement, Mr. Eichler
shall be paid cash compensation at the rate of Three Hundred Thousand Dollars
($300,000) per annum, for the period commencing November 20, 2006 and continuing
thereafter to and including December 31, 2007.&#160;&#160;All stock options
heretofore granted to Mr. Eichler for services rendered shall be accelerated and
shall become fully vested on November 20, 2006 and may be exercised at any time
until November 20, 2007, after which time any unexercised options shall be
cancelled.&#160;&#160;Mr. Eichler is also eligible to participate in the
Company&#8217;s incentive and benefit plans, including eligibility to receive grants
of stock options under the 2004 Plan.&#160;&#160;Mr. Eichler received cash
payments through January 2007 and no further payments have been made after that
date.</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Mr.
Eichler worked full time for the Company from June 15, 2007 until March 31, 2008
without cash compensation.&#160;&#160;On October 18, 2007, Mr. Eichler was
appointed Interim Chief Financial Officer to replace Charles Dargan who resigned
on November 5, 2007.&#160;In lieu of compensation for these services as Interim
Chief Financial Officer, the Board extended the expiration date of Mr. Eichler&#8217;s
options to November 20, 2009.</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Effective
April 1, 2008, Mr. Eichler&#8217;s compensation is $10,000 per
month.</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; TEXT-ALIGN: left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold">CERTAIN RELATONSHIPS AND RELATED
TRANSACTIONS</font></font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
December 2008, three of our Directors converted accrued Director Fees in the
amount $136,000 into the 2008 Winter Convertible Note
Offering.</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div id="GLFTR" style="WIDTH: 100%" align="left">
          </div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">12</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="1">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="right">
          </div>
        </div>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold">COMPENSATION COMMITTEE
REPORT</font></font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-STYLE: italic">The following Report of the
Compensation Committee does not constitute soliciting material and should not be
deemed filed or incorporated by reference into any of our other filings under
the Securities Act of 1933, as amended (the &#8220;Securities Act&#8221;), or the Exchange
Act, except to the extent that we specifically incorporate this report by
reference therein.</font></font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
Compensation Committee has furnished this report on executive compensation for
the 2008 fiscal year.</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
Compensation Committee administers the Company&#8217;s executive compensation program.
The Compensation Committee has the authority to review and determine the
salaries and bonuses of the executive officers of the Company, including the
Chief Executive Officer and the other executive officers named in the Summary
Compensation Table (the &#8220;Named Executive Officers&#8221;) appearing elsewhere in this
proxy statement, and to establish the general compensation policies for such
individuals. The Compensation Committee also has the sole and exclusive
authority to make discretionary option grants to all of the Company&#8217;s employees
under the Company&#8217;s 2004 Stock Option Plan (the &#8220;2004 Plan&#8221;).</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
Compensation Committee currently consists of Messrs.&#160;Price (chairperson),
Shelton and Bolio. The Board believes that Messrs. Price, Shelton and Bolio meet
independence requirements.&#160;&#160;None of our executive officers served on
the compensation committee of another entity or on any other committee of the
board of directors of another entity performing similar functions during 2008.
The Compensation Committee held three (3) meetings during 2008 and held one (1)
meeting to date during 2009.</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
Compensation Committee operates under a written charter. The charter reflects
these various responsibilities, and the Committee is charged with periodically
reviewing the charter. In addition, the Committee has the authority to engage
the services of outside advisors, experts and others, including independent
compensation consultants who do not advise the Company, to assist the
Committee..</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
Compensation Committee believes that the compensation programs for the Company&#8217;s
executive officers should reflect the Company&#8217;s performance and the value
created for the Company&#8217;s stockholders. In addition, the compensation programs
should support the short-term and long-term strategic goals and values of the
Company, reward individual contribution to the Company&#8217;s success and align the
interests of the Company&#8217;s officers with the interests of its stockholders. The
committee believes that the Company&#8217;s success depends upon its ability to
attract and retain qualified executives through the competitive compensation
packages it offers to such individuals.</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
principal factors that were taken into account in establishing each executive
officer&#8217;s compensation package for the 2008 fiscal year are described below.
However, the Compensation Committee may in its discretion apply entirely
different factors, such as different measures of financial performance, for
future fiscal years. Moreover, all of the Company&#8217;s Named Executive Officers
have entered into employment agreements with the Company and many components of
each such person&#8217;s compensation are set by such agreements.</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-STYLE: italic">Equity-Based Compensation.</font>
The Committee believes in linking long-term incentives to an increase in stock
value. Accordingly, it awards stock options under the 2004 Plan with an exercise
price equal to the fair market value of the underlying stock on the date of
grant that vest and become exercisable over time. The Committee believes that
these options encourage employees to continue to use their best efforts and to
remain in the Company&#8217;s employ. Options granted to executive officers under the
2004 Plan generally vest and become exercisable in annual 25% increments over a
four-year period after grant.</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
Committee relies substantially on management of the Company to make specific
recommendations regarding which individuals should receive option grants and the
amounts of such grants. In 2008, the Committee granted 2,700,000 options to all
employees, with 1,500,000, or 56%, of such amount being granted to Named
Executive Officers. The Named Executive Officers were individually awarded the
number of stock options shown in the table headed &#8220;Option Grants in Last Fiscal
Year&#8221; appearing elsewhere in this proxy statement.</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
Company granted stock options to executive officers with a cumulative option
price of up to $100,000 as incentive stock options and the remainder as
non-qualified stock options, both with an exercise price equal to the fair
market value of the Company&#8217;s common stock on the date of grant. Accordingly,
those stock options will have value only if the market price of the Company&#8217;s
common stock increases after that date. In determining the size of stock option
grants to executive officers, the Committee bases its decisions on such
considerations as similar awards to individuals holding comparable positions in
our comparative groups, company performance and individual performance, as well
as the allocation of overall share usage attributed to executive
officers.</font><br></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-STYLE: italic">Compliance with Code
Section&#160;162(m).</font> Section&#160;162(m) of the Code disallows a tax
deduction to publicly-held companies for compensation paid to certain of their
executive officers, to the extent that compensation exceeds $1&#160;million per
covered officer in any fiscal year. The limitation applies only to compensation
which is not considered to be performance based. Non-performance based
compensation paid to the Company&#8217;s executive officers for the 2008 fiscal year
did not exceed the $1&#160;million limit per officer, and the Compensation
Committee does not anticipate that the non-performance based compensation to be
paid to the Company&#8217;s executive officers for the 2009 fiscal year will exceed
that limit. Because it is unlikely that the cash compensation payable to any of
the Company&#8217;s executive officers in the foreseeable future will approach the
$1&#160;million limit, the Compensation Committee has decided at this time not
to take any action to limit or restructure the elements of cash compensation
payable to the Company&#8217;s executive officers. The Compensation Committee will
reconsider this decision should the individual cash non-performance based
compensation of any executive officer ever approach the $1&#160;million level.
&#160;</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The Board
did not modify any action or recommendation made by the Compensation Committee
with respect to executive compensation for the 2008 fiscal year. It is the
opinion of the Compensation Committee that the executive compensation policies
and plans provide the necessary total remuneration program to properly align the
Company&#8217;s performance and the interests of the Company&#8217;s stockholders through
the use of competitive and equitable executive compensation in a balanced and
reasonable manner, for both the short and long term.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    </div>
    <div>
      <table cellpadding="0" cellspacing="0" width="100%">
          <tr>
            <td align="left" valign="top" width="61%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td align="left" valign="top" width="39%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Respectfully
      submitted by:</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="61%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="top" width="39%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
          </tr>
          <tr>
            <td valign="top" width="61%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td align="left" valign="top" width="39%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">John
      F. Price, <font style="DISPLAY: inline; FONT-STYLE: italic">Chairman</font></font></div>
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Nathan
      Shelton</font></div>
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Steven
      Bolio</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
    <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
      <div id="FTR">
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        </div>
      </div>
      <div id="PN" style="PAGE-BREAK-AFTER: always">
        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">13</font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
          <hr style="COLOR: black" noshade size="1">
        </div>
      </div>
      <div id="HDR">
        <div id="GLHDR" style="WIDTH: 100%" align="right">
        </div>
      </div>
    </div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">AUDIT
COMMITTEE REPORT</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-STYLE: italic">The following report of the Audit
Committee does not constitute soliciting material and should not be deemed filed
or incorporated by reference into any of our other filings under the Securities
Act or the Exchange Act, except to the extent that we specifically incorporate
this report by reference therein, and shall not be deemed to be soliciting
material or otherwise deemed filed under either such
Act.</font></font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The Audit
Committee is currently composed of three (3) directors, Messrs. Kyte
(Chairperson), Price and Shelton Kyte.&#160;&#160;The Board has determined that
Mr. Price is an audit committee financial expert, and is independent within the
rules of the SEC. The Board also has determined that Mr. Bolio is independent
within the rules of the SEC. The duties and responsibilities of a member of the
Audit Committee are in addition to his duties as a member of the
Board.</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The Audit
Committee operates under a written charter, which is available on the Company&#8217;s
website. The Board and the Audit Committee believe that the Audit Committee
charter complies with the current standards set forth in SEC regulations. There
may be further action by the SEC during the current year on several matters that
affect all audit committees. The Board and the Audit Committee continue to
follow closely further developments by the SEC in the area of the functions of
audit committees, particularly as it relates to internal controls for
non-accelerated filers, and will make additional changes to the Audit Committee
charter and the policies of the Audit Committee as required or advisable as a
result of these new rules and regulations. The Audit Committee met four (4)
times during 2008 and two (2) times during 2009.</font></div>
    </div>
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Committee&#8217;s primary duties and responsibilities are to:</font></div>
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    </div>
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              <div style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#8226;&#160;</font></div>
            </td>
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      the Company&#8217;s independent auditor;</font></div>
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          <tr>
            <td valign="middle" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
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            <td valign="middle" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
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            <td valign="middle" width="75%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
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          <tr>
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      </font></td>
            <td valign="top" width="1%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt; TEXT-ALIGN: right" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#8226;&#160;</font></div>
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      the independent auditor&#8217;s independence, qualifications and
      performance;</font></div>
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          <tr>
            <td valign="middle" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="middle" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="middle" width="75%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
          </tr>
          <tr>
            <td valign="top" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="top" width="1%">
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            </td>
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      all audit and non-audit services;</font></div>
            </td>
          </tr>
          <tr>
            <td valign="middle" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="middle" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="middle" width="75%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
          </tr>
          <tr>
            <td valign="top" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="top" width="1%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt; TEXT-ALIGN: right" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#8226;&#160;</font></div>
            </td>
            <td valign="top" width="75%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">monitor
      the integrity of the Company&#8217;s financial reporting process and internal
      controls system;</font></div>
            </td>
          </tr>
          <tr>
            <td valign="middle" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="middle" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="middle" width="75%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
          </tr>
          <tr>
            <td valign="top" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="top" width="1%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt; TEXT-ALIGN: right" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#8226;&#160;</font></div>
            </td>
            <td valign="top" width="75%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">provide
      an open avenue of communication among the independent auditor, financial
      and senior management of the Company and the
    Board;&#160;and</font></div>
            </td>
          </tr>
          <tr>
            <td valign="middle" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="middle" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="middle" width="75%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
          </tr>
          <tr>
            <td valign="top" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="top" width="1%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt; TEXT-ALIGN: right" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#8226;&#160;</font></div>
            </td>
            <td valign="top" width="75%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">monitor
      the Company&#8217;s compliance with legal and regulatory
      requirements.</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Management
is responsible for the Company&#8217;s internal controls and the financial reporting
process. The Company&#8217;s independent auditor is responsible for performing an
independent audit of the Company&#8217;s financial statements in accordance with the
standards of the Public Company Accounting Oversight Board and issuing a report
thereon. The Audit Committee&#8217;s responsibility is to monitor and oversee these
processes.</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
Company is planning to form an internal management group, reporting to the Chief
Executive Officer and the Audit Committee that is charged with guiding the
Company in meeting the various requirements of Section&#160;404 of the
Sarbanes-Oxley Act of 2002. The Audit Committee has begun to implement
procedures to ensure that during the course of each fiscal year it devotes the
attention that it deems necessary or appropriate to each of the matters assigned
to it under its charter.</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
overseeing the preparation of the Company&#8217;s financial statements, the Audit
Committee held meetings with the Company&#8217;s independent auditors, both in the
presence of management and privately, to discuss the overall scope and plans for
their audit, review and discuss all financial statements prior to their
issuance, and discuss significant accounting issues. Management advised the
Audit Committee that all financial statements were prepared in accordance with
accounting principles generally accepted in the United States of America, and
the Audit Committee discussed the statements with both management and the
Company&#8217;s independent auditors. In accordance with Section&#160;204 of the
Sarbanes-Oxley Act and the Statement on Auditing Standards (&#8220;SAS&#8221;) No.&#160;61
(Communication With Audit Committees) as amended by SAS No.&#160;90 (Audit
Committee Communications), the Audit Committee has discussed with the Company&#8217;s
independent auditors all matters required under the Sarbanes-Oxley Act and the
foregoing standards.</font><br></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">With
respect to the Company&#8217;s independent auditors, the Audit Committee, among other
things, discussed with Weinberg&#160;&amp; Co., P.A., matters relating to its
independence, including the written disclosures made to the Audit Committee as
required by the Independence Standards Board Standard No.&#160;1 (Independence
Discussions with Audit Committees). The Audit Committee also reviewed and
approved the audit and non-audit fees of that firm.</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On the
basis of these reviews and discussions, the Audit Committee (i)&#160;appointed
Weinberg&#160;&amp; Co., P.A. as the independent registered public accounting
firm for the 2008 fiscal year and (ii)&#160;recommended to the Board that the
Board approve the inclusion of the Company&#8217;s audited financial statements in
the&#160;10-K for filing with the SEC.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    </div>
    <div>
      <table cellpadding="0" cellspacing="0" width="100%">
          <tr>
            <td valign="top" width="61%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="top" width="39%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Respectfully
      submitted:</font></div>
            </td>
          </tr>
          <tr>
            <td valign="middle" width="61%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="middle" width="39%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
          </tr>
          <tr>
            <td valign="top" width="61%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="top" width="39%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Cecil
      Bond Kyte&#160;&#160;<font style="DISPLAY: inline; FONT-STYLE: italic">(Chairman)</font></font></div>
            </td>
          </tr>
          <tr>
            <td valign="top" width="61%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="top" width="39%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">John
      Price, PhD</font></div>
            </td>
          </tr>
          <tr>
            <td valign="top" width="61%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="top" width="39%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Nathan
      Shelton</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
    <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
      <div id="FTR">
        <div id="GLFTR" style="WIDTH: 100%" align="left">
        </div>
      </div>
      <div id="PN" style="PAGE-BREAK-AFTER: always">
        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">14</font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
          <hr style="COLOR: black" noshade size="1">
        </div>
      </div>
      <div id="HDR">
        <div id="GLHDR" style="WIDTH: 100%" align="right">
        </div>
      </div>
    </div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br>&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">SECTION&#160;16(a)
BENEFICIAL OWNERSHIP REPORTING COMPLIANCE</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Section&#160;16(a)
of the Exchange Act requires our directors, executive officers and holders of
more than 10% of a registered class of our equity securities to file with the
SEC initial reports of ownership and reports of changes in ownership of our
common stock and our other equity securities. Directors, executive officers and
greater than 10% stockholders are required by SEC regulation to furnish us with
copies of all Section&#160;16(a) reports they file. Based solely on our review
of the copies of such forms received by us, or written representation from
certain reporting persons that no Form&#160;5s were required for those persons,
we believe that all reporting requirements under Section&#160;16(a) for the
2008fiscal year were met in a timely manner by our directors, executive officers
and greater than 10% beneficial owners.</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold">STOCKHOLDER
PROPOSALS</font></font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">From time
to time stockholders present proposals that may be proper subjects for inclusion
in a proxy statement and for consideration at an annual meeting. Under the rules
of the SEC, to be included in the proxy statement for our 2009 annual meeting of
stockholders, proposals must be received by us no later than January 5,
2009.</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold">ANNUAL REPORT ON FORM
10-K</font></font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We filed
our Annual Report on Form&#160;10-K with the SEC on March 30, 2009. A copy of
the 10-K, without exhibits, has been mailed to all stockholders along with this
proxy statement. Stockholders may obtain additional copies of the 10-K and the
exhibits thereto, without charge, by writing to the Corporate Secretary at our
principal executive office at 235 Tennant Avenue, Morgan Hill, California
95037.</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold">OTHER
MATTERS</font></font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Management
does not know of any matters to be presented at the 2009 Annual Meeting other
than those set forth herein and in the Notice accompanying this proxy statement.
If a stockholder vote is necessary to transact any other business at the 2009
Annual Meeting, the proxyholders intend to vote their proxies in accordance with
their best judgment related to such business.</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">It is
important that your shares be represented at the 2009 Annual Meeting, regardless
of the number of shares that you hold. <font style="DISPLAY: inline; FONT-WEIGHT: bold">YOU ARE, THEREFORE, URGED TO EXECUTE
PROMPTLY AND RETURN THE ACCOMPANYING PROXY IN THE ENVELOPE THAT HAS BEEN
ENCLOSED FOR YOUR</font>&#160;<font style="DISPLAY: inline; FONT-WEIGHT: bold">CONVENIENCE.</font> Stockholders who
are present at the 2009 Annual Meeting may revoke their proxies and vote in
person or, if they prefer, may abstain from voting in person and allow their
proxies to be voted.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    </div>
    <div>
      <table cellpadding="0" cellspacing="0" width="100%">
          <tr>
            <td align="left" valign="top" width="31%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td align="left" valign="top" width="47%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">By
      Order of the Board of Directors,</font></div>
            </td>
          </tr>
          <tr>
            <td valign="top" width="31%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="top" width="47%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
          </tr>
          <tr>
            <td valign="top" width="31%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td align="left" valign="top" width="47%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Cecil
      Bond Kyte, Chief Executive Officer and
Chairman</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">March 30,
2009</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Morgan
Hill, California</font></div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
    <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
      <div id="FTR">
        <div id="GLFTR" style="WIDTH: 100%" align="left">
        </div>
      </div>
      <div id="PN" style="PAGE-BREAK-AFTER: always">
        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">15</font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
          <hr style="COLOR: black" noshade size="1">
        </div>
      </div>
      <div id="HDR">
        <div id="GLHDR" style="WIDTH: 100%" align="right">
        </div>
      </div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold">SAVE THE WORLD AIR,
INC.</font></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2009
ANNUAL MEETING OF STOCKHOLDERS</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold">April 30, 2009</font></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center">&#160;</div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">This
proxy is solicited by the Board of Directors for use at the 2009 Annual Meeting
of Stockholders of Save the World Air, Inc., (the &#8220;Company&#8221;) to be held at the
Hilton Universal Hotel, 555 Universal Hollywood Drive, Universal City 91608,
California, at 10:00&#160;A.M. on April 30, 2009.&#160;&#160;By signing the
proxy, you revoke all prior proxies, acknowledge receipt of the Notice of 2009
Annual Meeting of Stockholders and the Proxy Statement, and appoint Cecil Bond
Kyte or designee with full power of substitution, to vote all your shares of
common stock of Save the World Air, Inc. which you are entitled to vote, on the
matters shown on the reverse side and any other&#160;matters which may come
before the Annual Meeting and all adjournments and postponements
thereof.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Whether
or not a choice is specified, this proxy, when properly executed, will be voted
in the discretion of the proxy holders upon such other business as may properly
come before the Annual Meeting or any adjournment or postponement
thereof.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
shares of stock you hold in your account will be voted as you specify on the
reverse side.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold">THE COMPANY</font><font style="DISPLAY: inline; FONT-WEIGHT: bold">&#8217;</font><font style="DISPLAY: inline; FONT-WEIGHT: bold">S BOARD OF DIRECTORS RECOMMENDS A
VOTE FOR THE ELECTION OF THE</font><font style="DISPLAY: inline; FONT-WEIGHT: bold"> DIRECTORS LISTED HEREON AND A VOTE
FOR PROPOSAL 2. IF NO CHOICE IS SPECIFIED, THE PROXY WILL BE VOTED FOR THE
ELECTION OF THE DIRECTORS LISTED HEREON AND FOR PROPOSAL
2.</font></font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold">SEE REVERSE FOR VOTING
INSTRUCTIONS.</font></font></div>
    </div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25">&#160;</div>
    <div id="PGBRK" style="MARGIN-LEFT: 0pt; WIDTH: 100%; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
      <div id="FTR">
        <div id="GLFTR" style="WIDTH: 100%" align="left"><font style="DISPLAY: inline; FONT-SIZE: 8pt; COLOR: #000000; FONT-FAMILY: Times New Roman">&#160;
</font></div>
      </div>
      <div id="PN" style="PAGE-BREAK-AFTER: always">
        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">16</font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
          <hr style="COLOR: black" noshade size="1">
        </div>
      </div>
      <div id="HDR">
        <div id="GLHDR" style="WIDTH: 100%" align="right"><font style="DISPLAY: inline; FONT-SIZE: 8pt; COLOR: #000000; FONT-FAMILY: Times New Roman">&#160;
</font></div>
      </div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline;" face="Wingdings">o</font>&#160;DETACH PROXY CARD
HERE <font style="DISPLAY: inline;" face="Wingdings">o</font></font>

      <div>
        <hr style="COLOR: black" align="left" noshade size="1" width="100%">
      </div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center">&#160;</div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold">Please </font><font style="DISPLAY: inline; FONT-WEIGHT: bold">mark, sign and date your proxy card
and return it today in the postage-paid envelope provided to: Nevada Agency and
Trust Company, 50 West Liberty Street, Suite&#160;880, Reno, Nevada 89501,
Attention: Proxy Department.</font></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
    </div>
    <div>
      <table cellpadding="0" cellspacing="0" width="100%">
          <tr>
            <td align="left" valign="top" width="2%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold">1.</font>&#160;&#160;</font></div>
            </td>
            <td align="left" valign="top" width="76%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">The
      Board of Directors recommends a vote FOR Items 1, and
  2.</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">ELECTION
OF DIRECTORS:</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
    </div>
    <div>
      <table cellpadding="0" cellspacing="0" width="100%">
          <tr>
            <td align="left" valign="top" width="2%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font style="DISPLAY: inline; FONT-FAMILY: wingdings">o</font></font></div>
            </td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td align="left" valign="top" width="31%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Vote
      <font style="DISPLAY: inline; FONT-WEIGHT: bold">FOR </font>all nominees
      listed</font></div>
            </td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td align="left" valign="top" width="2%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font style="DISPLAY: inline; FONT-FAMILY: wingdings">o</font></font></div>
            </td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td align="left" valign="top" width="39%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Vote
      <font style="DISPLAY: inline; FONT-WEIGHT: bold">WITHHELD </font>from all
      nominees</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
    </div>
    <div>
      <table cellpadding="0" cellspacing="0" width="100%">
          <tr>
            <td align="left" valign="top" width="18%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">01
      Cecil Bond Kyte</font></div>
            </td>
            <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td align="left" valign="top" width="18%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">02
      Charles R. Blum</font></div>
            </td>
            <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td align="left" valign="top" width="18%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">03
      John F. Price</font></div>
            </td>
            <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td align="left" valign="top" width="18%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">04
      Nathan Shelton</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="18%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">05
      Steven Bolio</font></div>
            </td>
            <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="top" width="18%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="top" width="18%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td align="left" valign="top" width="18%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold">(to withhold authority to vote for
any nominee, strike a line</font><font style="DISPLAY: inline; FONT-WEIGHT: bold"> through the nominee</font><font style="DISPLAY: inline; FONT-WEIGHT: bold">&#8217;</font><font style="DISPLAY: inline; FONT-WEIGHT: bold">s name
above)</font></font></div>
    </div>
    <div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
    </div>
    <div>
      <table cellpadding="0" cellspacing="0" width="100%">
          <tr>
            <td align="left" valign="top" width="2%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2.&#160;&#160;</font></div>
            </td>
            <td align="left" valign="top" width="76%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">RATIFICATION
      OF APPOINTMENT OF WEINBERG &amp; CO., P.A. as independent auditors of Save
      the World Air, Inc. for the fiscal year ended December&#160;31,
      2008.</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
    </div>
    <div>
      <table cellpadding="0" cellspacing="0" width="100%">
          <tr>
            <td valign="top" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td align="left" valign="bottom" width="3%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;<font style="DISPLAY: inline; FONT-FAMILY: wingdings">o</font></font></div>
            </td>
            <td align="left" valign="bottom" width="9%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">FOR</font></div>
            </td>
            <td align="left" valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="top" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td align="left" valign="bottom" width="3%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;<font style="DISPLAY: inline; FONT-FAMILY: wingdings">o</font></font></div>
            </td>
            <td align="left" valign="bottom" width="14%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">AGAINST</font></div>
            </td>
            <td align="left" valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td valign="top" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td align="left" valign="bottom" width="3%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;<font style="DISPLAY: inline; FONT-FAMILY: wingdings">o</font></font></div>
            </td>
            <td align="left" valign="bottom" width="14%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">ABSTAIN</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
    </div>
    <div>
      <table cellpadding="0" cellspacing="0" width="100%">
          <tr>
            <td align="left" valign="top" width="78%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">THIS
      PROXY WHEN PROPERLY EXECUTED WILL BE VOTED AS DIRECTED OR, IF NO DIRECTION
      IS GIVEN, WILL BE VOTED FOR THE ELECTION OF EACH OF THE DIRECTORS LISTED
      HEREON, IN FAVOR OF PROPOSAL 2, AND IN THE DISCRETION OF THE PROXY HOLDERS
      ON ALL OTHER MATTERS PROPERLY BROUGHT BEFORE THE
  MEETING.</font></div>
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          </tr>
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    </div>
    <div>
      <table cellpadding="0" cellspacing="0" width="100%">
          <tr>
            <td align="left" valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td align="left" valign="bottom" width="74%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
          </tr>
          <tr>
            <td align="left" valign="top" width="3%" style="PADDING-BOTTOM: 2px">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Date:</font></div>
            </td>
            <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td align="left" valign="top" width="74%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
          </tr>
          <tr>
            <td align="left" valign="top" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td align="left" valign="middle" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td align="left" valign="top" width="74%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
          </tr>
          <tr>
            <td align="left" valign="top" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td align="left" valign="top" width="74%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
          </tr>
          <tr>
            <td align="left" valign="top" width="3%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td align="left" valign="top" width="74%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
          </tr>
          <tr>
            <td align="left" colspan="3" valign="top" width="78%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
          </tr>
          <tr>
            <td colspan="3" valign="top" width="78%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Signature</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td align="left" valign="top" width="74%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
          </tr>
          <tr>
            <td align="left" valign="top" width="3%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td align="left" valign="top" width="74%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
          </tr>
          <tr>
            <td align="left" colspan="3" valign="top" width="78%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
          </tr>
          <tr>
            <td colspan="3" valign="top" width="78%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Signature
      (if joint or common ownership)</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td align="left" valign="top" width="74%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
          </tr>
          <tr>
            <td colspan="3" valign="top" width="78%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Please
      sign exactly as your name(s) appears on the Proxy. If held in joint
      tenancy, all persons must sign. Trustees, administrators, etc., should
      include title and authority. Corporations should provide full name of
      corporation and title of authorized officer signing the proxy. If a
      partnership, please sign partnership name by authorized
      person.</font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25"><br></div>
    </div>
    <div>
      <table cellpadding="0" cellspacing="0" width="100%">
          <tr>
            <td align="left" valign="top" width="70%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">For
      address change: Mark Box and indicate changes below:</font></div>
            </td>
            <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            <td align="left" valign="top" width="7%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font style="DISPLAY: inline; FONT-FAMILY: wingdings">o</font></font></div>
            </td>
          </tr>
      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">17</font>

      <div>
        <hr style="COLOR: black" align="left" noshade size="1" width="100%">
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