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<SEC-DOCUMENT>0000727273-07-000022.txt : 20070806
<SEC-HEADER>0000727273-07-000022.hdr.sgml : 20070806
<ACCEPTANCE-DATETIME>20070806171553
ACCESSION NUMBER:		0000727273-07-000022
CONFORMED SUBMISSION TYPE:	10-Q
PUBLIC DOCUMENT COUNT:		6
CONFORMED PERIOD OF REPORT:	20070630
FILED AS OF DATE:		20070806
DATE AS OF CHANGE:		20070806

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			CADIZ INC
		CENTRAL INDEX KEY:			0000727273
		STANDARD INDUSTRIAL CLASSIFICATION:	WATER SUPPLY [4941]
		IRS NUMBER:				770313235
		STATE OF INCORPORATION:			DE
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		10-Q
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	000-12114
		FILM NUMBER:		071028717

	BUSINESS ADDRESS:	
		STREET 1:		777 SOUTH FIGUEROA STREET
		STREET 2:		SUITE 4250
		CITY:			LOS ANGELES
		STATE:			CA
		ZIP:			90017
		BUSINESS PHONE:		213-271-1600

	MAIL ADDRESS:	
		STREET 1:		777 SOUTH FIGUEROA STREET
		STREET 2:		SUITE 4250
		CITY:			LOS ANGELES
		STATE:			CA
		ZIP:			90017

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	CADIZ LAND CO INC
		DATE OF NAME CHANGE:	19920703

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	PACIFIC AGRICULTURAL HOLDINGS INC
		DATE OF NAME CHANGE:	19920602

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	ARIDTECH INC
		DATE OF NAME CHANGE:	19880523
</SEC-HEADER>
<DOCUMENT>
<TYPE>10-Q
<SEQUENCE>1
<FILENAME>form10q_june07.htm
<DESCRIPTION>FORM 10-Q FOR THE QUARTER ENDED JUNE 30, 2007
<TEXT>
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    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.15; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 24pt; FONT-FAMILY: Times New Roman">United
      States</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.15; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 24pt; FONT-FAMILY: Times New Roman">Securities
      and</font><font style="DISPLAY: inline; FONT-SIZE: 24pt; FONT-FAMILY: Times New Roman">&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 24pt; FONT-FAMILY: Times New Roman">Exchange</font><font style="DISPLAY: inline; FONT-SIZE: 24pt; FONT-FAMILY: Times New Roman">&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 24pt; FONT-FAMILY: Times New Roman">Commission</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.15; MARGIN-RIGHT: 0pt" align="center"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.15; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman"><strong>Washington,
      D. C. 20549</strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.15; MARGIN-RIGHT: 0pt" align="center">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: -9pt; LINE-HEIGHT: 1.15; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman"><strong>FORM
      10-Q</strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.15; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.15; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(Mark
      One)</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.15; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.15; MARGIN-RIGHT: 0pt" align="center"><font size="2">[&#8730;]&#160;
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Quarterly
      Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
      for the quarterly period ended June 30, 2007</font></font></div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.15; MARGIN-RIGHT: 0pt" align="center">&#160;</div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.15; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">OR</font></div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.15; MARGIN-RIGHT: 0pt" align="center">&#160;</div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.15; MARGIN-RIGHT: 0pt" align="center"><font size="2">[&#160;&#160;
]&#160;
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Transition
      Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
      <font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">for
      the transition period from &#8230;&#8230; to &#8230;&#8230;.</font></font></font>&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: -36pt; LINE-HEIGHT: 1.15; MARGIN-RIGHT: 0pt" align="center">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.15; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Commission
      File Number 0-12114</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.15; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.15; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 24pt; FONT-FAMILY: Times New Roman">Cadiz</font><font style="DISPLAY: inline; FONT-SIZE: 24pt; FONT-FAMILY: Times New Roman">&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 24pt; FONT-FAMILY: Times New Roman">Inc.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.15; MARGIN-RIGHT: 0pt" align="center"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.15; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Exact
      name of registrant specified in its charter)</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.15; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.15; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>DELAWARE
      77-0313235</strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.15; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(State
      or
      other jurisdiction of (I.R.S. Employer</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.15; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">incorporation
      or organization) Identification No.)</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.15; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.15; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>777
      S. Figueroa Street, Suite 4250</strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.15; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Los
      Angeles, California</strong></font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 103.5pt">&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>
      90017</strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.15; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(Address
      of principal executive offices)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 103.5pt">&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(Zip
      Code)</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.15; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.15; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Registrant&#8217;s
      telephone number, including area code: </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>(213)
      271-1600</strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.15; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.15; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Indicate
      by check mark whether the registrant (1) has filed all reports required to
      be
      filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
      the
      preceding 12 months (or for such shorter period that the registrant was required
      to file such reports), and (2) has been subject to such filing requirements
      for
      the past 90 days.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.15; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Yes
      _</strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>&#8730;</u><strong>_</strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>&#160;&#160;
      No ___</strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.15; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.15; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Indicate
      by check mark whether the Registrant is a large accelerated filer, an
      accelerated filer, or a non-accelerated filer (as defined in Exchange Act Rule
      12b-2).</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.15; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Large
      accelerated filer ___&#160; &#160;Accelerated filer </strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>_</strong><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>&#8730;</u><strong>_&#160;
      &#160;</strong></font></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>&#160;Non-accelerated
      filer ___</strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.15; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.15; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Indicate
      by check mark whether the Registrant is a shell company (as defined in Exchange
      Act Rule 12b-2). </font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.15; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Yes___
      No </strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>_</strong><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>&#8730;</u><strong>_</strong></font></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.15; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.15; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">As
      of
      August 1, 2007, the Registrant had 11,903,611 shares of common stock, par value
      $0.01 per share, outstanding.</font></div>
    <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
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        </div>
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        <div style="WIDTH: 100%; TEXT-ALIGN: center">
        </div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
        </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="left">
      <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><strong><font size="2">CADIZ
        INC.</font></strong></div>
      <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center">&#160;</div>
      <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>INDEX</strong></font>&#160;</div>
    </div><br>
    <div>
      <table cellpadding="0" cellspacing="0" width="100%">

          <tr>
            <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"><strong><em>For
                the Three and Six months ended June 30, 2007</em></strong></font></div>
            </td>
            <td align="left" valign="top" width="8%">
              <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"><strong><em>Page</em></strong></font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="72%">&#160;</td>
            <td align="left" valign="top" width="8%">&#160;</td>
          </tr>
          <tr>
            <td align="left" valign="top" width="72%">&#160;</td>
            <td align="left" valign="top" width="8%">&#160;</td>
          </tr>
          <tr>
            <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"><strong>PART
                I - FINANCIAL INFORMATION</strong></font></div>
            </td>
            <td align="left" valign="top" width="8%">&#160;</td>
          </tr>
          <tr>
            <td align="left" valign="top" width="72%">&#160;</td>
            <td align="left" valign="top" width="8%">&#160;</td>
          </tr>
          <tr>
            <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"><strong>ITEM
                1. Financial Statements</strong></font></div>
            </td>
            <td align="left" valign="top" width="8%">&#160;</td>
          </tr>
          <tr>
            <td align="left" valign="top" width="72%">&#160;</td>
            <td align="left" valign="top" width="8%">&#160;</td>
          </tr>
          <tr>
            <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 id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Cadiz
                Inc. Consolidated Financial Statements</strong></font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 27pt">&#160;</font></div>
            </td>
            <td align="left" valign="top" width="8%">&#160;</td>
          </tr>
          <tr>
            <td align="left" valign="top" width="72%">&#160;</td>
            <td align="left" valign="top" width="8%">&#160;</td>
          </tr>
          <tr>
            <td align="left" valign="top" width="72%">
              <div style="DISPLAY: block; MARGIN-LEFT: 54pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Unaudited
                Statements of Operations for the three months ended June 30, 2007
                and
                2006</font></div>
            </td>
            <td align="left" valign="top" width="8%">
              <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">1</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="72%">&#160;</td>
            <td align="left" valign="top" width="8%">&#160;</td>
          </tr>
          <tr>
            <td align="left" valign="top" width="72%">
              <div style="DISPLAY: block; MARGIN-LEFT: 54pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Unaudited
                Statements of Operations for the six months ended June 30, 2007 and
                2006</font></div>
            </td>
            <td align="left" valign="top" width="8%">
              <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">2</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="72%">&#160;</td>
            <td align="left" valign="top" width="8%">&#160;</td>
          </tr>
          <tr>
            <td align="left" valign="top" width="72%">
              <div style="DISPLAY: block; MARGIN-LEFT: 54pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Unaudited
                Balance Sheets as of June 30, 2007 and December 31, 2006</font></div>
            </td>
            <td align="left" valign="top" width="8%">
              <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">3</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="72%">&#160;</td>
            <td align="left" valign="top" width="8%">&#160;</td>
          </tr>
          <tr>
            <td align="left" valign="top" width="72%">
              <div style="DISPLAY: block; MARGIN-LEFT: 54pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Unaudited
                Statements of Cash Flows for the six months ended June 30, 2007 and
                2006</font></div>
            </td>
            <td align="left" valign="top" width="8%">
              <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">4</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="72%">&#160;</td>
            <td align="left" valign="top" width="8%">&#160;</td>
          </tr>
          <tr>
            <td align="left" valign="top" width="72%">
              <div style="DISPLAY: block; MARGIN-LEFT: 54pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Unaudited
                Statement of Stockholders&#8217; Equity for the six months ended June 30,
                2007</font></div>
            </td>
            <td align="left" valign="top" width="8%">
              <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">5</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="72%">&#160;</td>
            <td align="left" valign="top" width="8%">&#160;</td>
          </tr>
          <tr>
            <td align="left" valign="top" width="72%">
              <div style="DISPLAY: block; MARGIN-LEFT: 54pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Unaudited
                Notes to the Consolidated Financial Statements</font></div>
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            <td align="left" valign="top" width="8%">
              <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">6</font></div>
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          </tr>
          <tr>
            <td align="left" valign="top" width="72%">&#160;</td>
            <td align="left" valign="top" width="8%">&#160;</td>
          </tr>
          <tr>
            <td align="left" valign="top" width="72%">&#160;</td>
            <td align="left" valign="top" width="8%">&#160;</td>
          </tr>
          <tr>
            <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"><strong>ITEM
                2. Management&#8217;s Discussion and Analysis of Financial Condition and Results
                of Operations</strong></font></div>
            </td>
            <td align="left" valign="top" width="8%">
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">16</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="72%">&#160;</td>
            <td align="left" valign="top" width="8%">&#160;</td>
          </tr>
          <tr>
            <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"><strong>ITEM
                3. Quantitative and Qualitative Disclosures about Market
                Risk</strong></font></div>
            </td>
            <td align="left" valign="top" width="8%">
              <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">26</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="72%">&#160;</td>
            <td align="left" valign="top" width="8%">&#160;</td>
          </tr>
          <tr>
            <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"><strong>ITEM
                4. Controls and Procedures</strong></font></div>
            </td>
            <td align="left" valign="top" width="8%">
              <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">26</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="72%">&#160;</td>
            <td align="left" valign="top" width="8%">&#160;</td>
          </tr>
          <tr>
            <td align="left" valign="top" width="72%">&#160;</td>
            <td align="left" valign="top" width="8%">&#160;</td>
          </tr>
          <tr>
            <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"><strong>PART
                II - OTHER INFORMATION</strong></font></div>
            </td>
            <td align="left" valign="top" width="8%">
              <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">27</font></div>
            </td>
          </tr>

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      <div id="FTR">
        <div id="GLFTR" style="WIDTH: 100%" align="left">
        </div>
      </div>
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        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman"><strong>ii</strong></font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
        </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="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>CADIZ
      INC.</strong></font></div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center">&#160;</div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>CONSOLIDATED
      STATEMENTS OF OPERATIONS (UNAUDITED)</strong></font></div>
    <div>
      <table cellpadding="0" cellspacing="0" width="100%">

          <tr>
            <td align="right" valign="top" width="57%" style="border-bottom: black thin solid;">&#160;</td>
            <td colspan="8" valign="top" width="23%" style="border-bottom: black thin solid;">&#160;</td>
          </tr>
          <tr>
            <td align="right" valign="top" width="57%">&#160;</td>
            <td colspan="8" valign="top" width="23%">
              <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"><strong>For
                the Three Months</strong></font></div>
            </td>
          </tr>
          <tr>
            <td align="right" valign="top" width="57%">&#160;</td>
            <td colspan="8" valign="top" width="23%">
              <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"><strong>Ended
                June 30,</strong></font></div>
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          <tr>
            <td align="left" valign="top" width="57%" style="border-bottom: black thin solid;">
              <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"><strong><em>($
                in thousands except per share data)</em></strong></font></div>
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            <td colspan="4" valign="top" width="13%" style="border-bottom: black thin solid;">
              <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: -9pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>2007</strong></font></div>
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            <td colspan="4" valign="top" width="10%" style="border-bottom: black thin solid;">
              <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: -9pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>2006</strong></font></div>
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          <tr>
            <td align="right" valign="top" width="57%">&#160;</td>
            <td align="right" colspan="4" valign="top" width="13%">&#160;</td>
            <td align="right" colspan="3" valign="top" width="10%">&#160;</td>
          </tr>
          <tr>
            <td align="left" valign="top" width="57%">
              <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">Revenues</font></div>
            </td>
            <td align="right" valign="top" width="2%" style="border-bottom: black thin solid;">
              <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: -9pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$</font></div>
            </td>
            <td align="left" valign="top" width="9%" style="border-bottom: black thin solid;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">5</font></div>
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            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" colspan="2" valign="top" width="3%" style="border-bottom: black thin solid;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$</font></div>
            </td>
            <td align="left" colspan="3" valign="top" width="8%" style="border-bottom: black thin solid;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">157</font></div>
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          </tr>
          <tr>
            <td align="left" valign="top" width="57%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="9%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" colspan="2" valign="top" width="3%">&#160;</td>
            <td align="left" colspan="3" valign="top" width="8%">&#160;</td>
          </tr>
          <tr>
            <td align="left" valign="top" width="57%">
              <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">Costs
                and expenses:</font></div>
            </td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="9%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" colspan="2" valign="top" width="3%">&#160;</td>
            <td align="left" colspan="3" valign="top" width="8%">&#160;</td>
          </tr>
          <tr>
            <td align="left" valign="top" width="57%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 18pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Cost
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            </td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="9%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">-</font></div>
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            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" colspan="2" valign="top" width="3%">&#160;</td>
            <td align="left" colspan="3" valign="top" width="8%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">130</font></div>
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          <tr>
            <td align="left" valign="top" width="57%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 18pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">General
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            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="9%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">1,356</font></div>
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            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" colspan="2" valign="top" width="3%">&#160;</td>
            <td align="left" colspan="3" valign="top" width="8%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">1,774</font></div>
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          </tr>
          <tr>
            <td align="left" valign="top" width="57%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 18pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Depreciation
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            </td>
            <td align="right" valign="top" width="2%" style="border-bottom: black thin solid;">&#160;</td>
            <td align="left" valign="top" width="9%" style="border-bottom: black thin solid;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">39</font></div>
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            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" colspan="2" valign="top" width="3%" style="border-bottom: black thin solid;">&#160;</td>
            <td align="left" colspan="3" valign="top" width="8%" style="border-bottom: black thin solid;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">39</font></div>
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          </tr>
          <tr>
            <td align="left" valign="top" width="57%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="9%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" colspan="2" valign="top" width="3%">&#160;</td>
            <td align="left" colspan="3" valign="top" width="8%">&#160;</td>
          </tr>
          <tr>
            <td align="left" valign="top" width="57%">
              <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
                costs and expenses</font></div>
            </td>
            <td align="right" valign="top" width="2%" style="border-bottom: black thin solid;">&#160;</td>
            <td align="left" valign="top" width="9%" style="border-bottom: black thin solid;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">1,395</font></div>
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            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" colspan="2" valign="top" width="3%" style="border-bottom: black thin solid;">&#160;</td>
            <td align="left" colspan="3" valign="top" width="8%" style="border-bottom: black thin solid;">
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          <tr>
            <td align="left" valign="top" width="57%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="9%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" colspan="2" valign="top" width="3%">&#160;</td>
            <td align="left" colspan="3" valign="top" width="8%">&#160;</td>
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            <td align="left" valign="top" width="57%">
              <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">Operating
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            <td align="left" valign="top" width="9%">
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            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" colspan="2" valign="top" width="3%">&#160;</td>
            <td align="left" colspan="3" valign="top" width="8%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(1,786)</font></div>
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          </tr>
          <tr>
            <td align="left" valign="top" width="57%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="9%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" colspan="2" valign="top" width="3%">&#160;</td>
            <td align="left" colspan="3" valign="top" width="8%">&#160;</td>
          </tr>
          <tr>
            <td align="left" valign="top" width="57%">
              <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">Other
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            </td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="9%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" colspan="2" valign="top" width="3%">&#160;</td>
            <td align="left" colspan="3" valign="top" width="8%">&#160;</td>
          </tr>
          <tr>
            <td align="left" valign="top" width="57%">
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            </td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="9%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(765)</font></div>
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            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" colspan="2" valign="top" width="3%">&#160;</td>
            <td align="left" colspan="3" valign="top" width="8%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(496)</font></div>
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          </tr>
          <tr>
            <td align="left" valign="top" width="57%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 18pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Loss
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            </td>
            <td align="right" valign="top" width="2%" style="border-bottom: black thin solid;">&#160;</td>
            <td align="left" valign="top" width="9%" style="border-bottom: black thin solid;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">-</font></div>
            </td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" colspan="2" valign="top" width="3%" style="border-bottom: black thin solid;">&#160;</td>
            <td align="left" colspan="3" valign="top" width="8%" style="border-bottom: black thin solid;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(868)</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="57%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 18pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Other
                (expense), net</font></div>
            </td>
            <td align="right" valign="top" width="2%" style="border-bottom: black thin solid;">&#160;</td>
            <td align="left" valign="top" width="9%" style="border-bottom: black thin solid;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(765)</font></div>
            </td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" colspan="2" valign="top" width="3%" style="border-bottom: black thin solid;">&#160;</td>
            <td align="left" colspan="3" valign="top" width="8%" style="border-bottom: black thin solid;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(1,364)</font></div>
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          <tr>
            <td align="left" valign="top" width="57%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="9%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" colspan="2" valign="top" width="3%">&#160;</td>
            <td align="left" colspan="3" valign="top" width="8%">&#160;</td>
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          <tr>
            <td align="left" valign="top" width="57%">
              <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">Loss
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            <td align="left" valign="top" width="9%">
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            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" colspan="2" valign="top" width="3%">&#160;</td>
            <td align="left" colspan="3" valign="top" width="8%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(3,150)</font></div>
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          <tr>
            <td align="left" valign="top" width="57%">
              <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">Income
                tax provision</font></div>
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            <td align="right" valign="top" width="2%" style="border-bottom: black thin solid;">&#160;</td>
            <td align="left" valign="top" width="9%" style="border-bottom: black thin solid;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">3</font></div>
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            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" colspan="2" valign="top" width="3%" style="border-bottom: black thin solid;">&#160;</td>
            <td align="left" colspan="3" valign="top" width="8%" style="border-bottom: black thin solid;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">-</font></div>
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          <tr>
            <td align="left" valign="top" width="57%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="9%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" colspan="2" valign="top" width="3%">&#160;</td>
            <td align="left" colspan="3" valign="top" width="8%">&#160;</td>
          </tr>
          <tr>
            <td align="left" valign="top" width="57%">
              <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">Net
                loss</font></div>
            </td>
            <td align="right" valign="top" width="2%" style="border-bottom: black double;">
              <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: -9pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$</font></div>
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            <td align="left" valign="top" width="9%" style="border-bottom: black double;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(2,158)</font></div>
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            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" colspan="2" valign="top" width="3%" style="border-bottom: black double;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$</font></div>
            </td>
            <td align="left" colspan="3" valign="top" width="8%" style="border-bottom: black double;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(3,150)</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="57%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="9%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" colspan="2" valign="top" width="3%">&#160;</td>
            <td align="left" colspan="3" valign="top" width="8%">&#160;</td>
          </tr>
          <tr>
            <td align="left" valign="top" width="57%">
              <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">Net
                loss applicable to common stock</font></div>
            </td>
            <td align="right" valign="top" width="2%" style="border-bottom: black double;">
              <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: -9pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$</font></div>
            </td>
            <td align="left" valign="top" width="9%" style="border-bottom: black double;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(2,158)</font></div>
            </td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" colspan="2" valign="top" width="3%" style="border-bottom: black double;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$</font></div>
            </td>
            <td align="left" colspan="3" valign="top" width="8%" style="border-bottom: black double;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(3,150)</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="57%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="9%">
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right">&#160;</div>
            </td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" colspan="2" valign="top" width="3%">&#160;</td>
            <td align="left" colspan="3" valign="top" width="8%">&#160;</td>
          </tr>
          <tr>
            <td align="left" valign="top" width="57%">
              <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">Basic
                and diluted net loss per common share</font></div>
            </td>
            <td align="right" valign="top" width="2%" style="border-bottom: black double;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$</font></div>
            </td>
            <td align="left" valign="top" width="9%" style="border-bottom: black double;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(0.18)</font></div>
            </td>
            <td align="right" valign="top" width="2%">
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right">&#160;</div>
            </td>
            <td align="right" colspan="2" valign="top" width="3%" style="border-bottom: black double;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$</font></div>
            </td>
            <td align="left" colspan="3" valign="top" width="8%" style="border-bottom: black double;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(0.28)</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="57%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="9%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" colspan="2" valign="top" width="3%">&#160;</td>
            <td align="left" colspan="3" valign="top" width="8%">&#160;</td>
          </tr>
          <tr>
            <td align="left" valign="top" width="57%">
              <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">Basic
                and diluted weighted average shares outstanding</font></div>
            </td>
            <td align="right" valign="top" width="2%" style="border-bottom: black double;">&#160;</td>
            <td align="left" valign="top" width="9%" style="border-bottom: black double;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">11,889</font></div>
            </td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" colspan="2" valign="top" width="3%" style="border-bottom: black double;">&#160;</td>
            <td align="right" colspan="3" valign="top" width="8%" style="border-bottom: black double;">
              <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">11,330</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" colspan="7" valign="top" width="78%">&#160;</td>
          </tr>

      </table>
    </div>
    <div>&#160;</div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">See
      accompanying notes to the consolidated financial statements.</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></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: 8pt; FONT-FAMILY: "><strong>1</strong></font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
        </div>
      </div>
      <div id="HDR">
        <div id="GLHDR" style="WIDTH: 100%" align="right">
        </div>
      </div>
    </div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font size="2"><strong>CADIZ
      INC.</strong></font></div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center">&#160;</div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font size="2"><strong>CONSOLIDATED
      STATEMENTS OF OPERATIONS
      (UNAUDITED)</strong></font></div>
    <div>
      <table cellpadding="0" cellspacing="0" width="100%">

          <tr>
            <td align="left" valign="top" width="58%" style="border-bottom: black thin solid;">&#160;</td>
            <td align="left" colspan="5" valign="top" width="23%" style="border-bottom: black thin solid;">&#160;</td>
          </tr>
          <tr>
            <td align="right" valign="top" width="58%">&#160;</td>
            <td colspan="5" valign="top" width="23%">
              <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"><strong>For
                the Six Months</strong></font></div>
            </td>
          </tr>
          <tr>
            <td align="right" valign="top" width="58%">&#160;</td>
            <td colspan="5" valign="top" width="23%">
              <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"><strong>Ended
                June 30,</strong></font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="58%" style="border-bottom: black thin solid;">
              <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"><strong><em>($
                in thousands except per share data)</em></strong></font></div>
            </td>
            <td colspan="2" valign="top" width="10%" style="border-bottom: black thin solid;">
              <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>2007</strong></font></div>
            </td>
            <td valign="top" width="2%" style="border-bottom: black thin solid;">&#160;</td>
            <td colspan="2" valign="top" width="10%" style="border-bottom: black thin 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"><strong>2006</strong></font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="58%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="8%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="8%">&#160;</td>
          </tr>
          <tr>
            <td align="justify" valign="top" width="58%">
              <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">Revenues</font></div>
            </td>
            <td align="right" valign="top" width="2%" style="border-bottom: black thin solid;">
              <div align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$</font></div>
            </td>
            <td align="left" valign="top" width="8%" style="border-bottom: black thin solid;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">357</font></div>
            </td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%" style="border-bottom: black thin solid;">
              <div align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$</font></div>
            </td>
            <td align="left" valign="top" width="8%" style="border-bottom: black thin solid;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">409</font></div>
            </td>
          </tr>
          <tr>
            <td align="justify" valign="top" width="58%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="8%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="8%">&#160;</td>
          </tr>
          <tr>
            <td align="justify" valign="top" width="58%">
              <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">Costs
                and expenses:</font></div>
            </td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="8%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="8%">&#160;</td>
          </tr>
          <tr>
            <td align="justify" valign="top" width="58%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 18pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Cost
                of sales</font></div>
            </td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="8%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">348</font></div>
            </td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="8%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">341</font></div>
            </td>
          </tr>
          <tr>
            <td align="justify" valign="top" width="58%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 18pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">General
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            </td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="8%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">3,131</font></div>
            </td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="8%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">3,870</font></div>
            </td>
          </tr>
          <tr>
            <td align="justify" valign="top" width="58%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 18pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Depreciation
                and amortization</font></div>
            </td>
            <td align="right" valign="top" width="2%" style="border-bottom: black thin solid;">&#160;</td>
            <td align="left" valign="top" width="8%" style="border-bottom: black thin solid;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">76</font></div>
            </td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%" style="border-bottom: black thin solid;">&#160;</td>
            <td align="left" valign="top" width="8%" style="border-bottom: black thin solid;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">79</font></div>
            </td>
          </tr>
          <tr>
            <td align="justify" valign="top" width="58%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="8%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="8%">&#160;</td>
          </tr>
          <tr>
            <td align="justify" valign="top" width="58%">
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                costs and expenses</font></div>
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            <td align="right" valign="top" width="2%" style="border-bottom: black thin solid;">&#160;</td>
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            <td align="left" valign="top" width="8%" style="border-bottom: black thin solid;">
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          <tr>
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            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="8%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="8%">&#160;</td>
          </tr>
          <tr>
            <td align="justify" valign="top" width="58%">
              <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">Operating
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            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="8%">
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            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="8%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(3,881)</font></div>
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          <tr>
            <td align="justify" valign="top" width="58%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="8%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="8%">&#160;</td>
          </tr>
          <tr>
            <td align="justify" valign="top" width="58%">
              <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">Other
                income (expense)</font></div>
            </td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="8%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="8%">&#160;</td>
          </tr>
          <tr>
            <td align="justify" valign="top" width="58%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 18pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Interest
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            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="8%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(1,528)</font></div>
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            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="8%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(977)</font></div>
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          <tr>
            <td align="justify" valign="top" width="58%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 18pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Loss
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            </td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="8%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">-</font></div>
            </td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="8%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(868)</font></div>
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          </tr>
          <tr>
            <td align="justify" valign="top" width="58%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 18pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Other
                income</font></div>
            </td>
            <td align="right" valign="top" width="2%" style="border-bottom: black thin solid;">&#160;</td>
            <td align="left" valign="top" width="8%" style="border-bottom: black thin solid;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">-</font></div>
            </td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%" style="border-bottom: black thin solid;">&#160;</td>
            <td align="left" valign="top" width="8%" style="border-bottom: black thin solid;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">350</font></div>
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          </tr>
          <tr>
            <td align="justify" valign="top" width="58%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 18pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Other
                income (expense), net</font></div>
            </td>
            <td align="right" valign="top" width="2%" style="border-bottom: black thin solid;">&#160;</td>
            <td align="left" valign="top" width="8%" style="border-bottom: black thin solid;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(1,528)</font></div>
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            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%" style="border-bottom: black thin solid;">&#160;</td>
            <td align="left" valign="top" width="8%" style="border-bottom: black thin solid;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(1,495)</font></div>
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          </tr>
          <tr>
            <td align="justify" valign="top" width="58%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="8%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="8%">&#160;</td>
          </tr>
          <tr>
            <td align="justify" valign="top" width="58%">
              <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">Loss
                before income taxes</font></div>
            </td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="8%">
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            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="8%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(5,376)</font></div>
            </td>
          </tr>
          <tr>
            <td align="justify" valign="top" width="58%">
              <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">Income
                tax provision</font></div>
            </td>
            <td align="right" valign="top" width="2%" style="border-bottom: black thin solid;">&#160;</td>
            <td align="left" valign="top" width="8%" style="border-bottom: black thin solid;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">8</font></div>
            </td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%" style="border-bottom: black thin solid;">&#160;</td>
            <td align="left" valign="top" width="8%" style="border-bottom: black thin solid;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">-</font></div>
            </td>
          </tr>
          <tr>
            <td align="justify" valign="top" width="58%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="8%">
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right">&#160;</div>
            </td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="8%">
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right">&#160;</div>
            </td>
          </tr>
          <tr>
            <td align="justify" valign="top" width="58%">
              <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">Net
                loss</font></div>
            </td>
            <td align="right" valign="top" width="2%" style="border-bottom: black double;">
              <div align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$</font></div>
            </td>
            <td align="left" valign="top" width="8%" style="border-bottom: black double;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(4,734)</font></div>
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            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%" style="border-bottom: black double;">
              <div align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$</font></div>
            </td>
            <td align="left" valign="top" width="8%" style="border-bottom: black double;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(5,376)</font></div>
            </td>
          </tr>
          <tr>
            <td align="justify" valign="top" width="58%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="8%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="8%">&#160;</td>
          </tr>
          <tr>
            <td align="justify" valign="top" width="58%">
              <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">Net
                loss applicable to common stock</font></div>
            </td>
            <td align="right" valign="top" width="2%" style="border-bottom: black double;">
              <div align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$</font></div>
            </td>
            <td align="left" valign="top" width="8%" style="border-bottom: black double;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(4,734)</font></div>
            </td>
            <td align="right" valign="top" width="2%">
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right">&#160;</div>
            </td>
            <td align="right" valign="top" width="2%" style="border-bottom: black double;">
              <div align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$</font></div>
            </td>
            <td align="left" valign="top" width="8%" style="border-bottom: black double;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(5,376)</font></div>
            </td>
          </tr>
          <tr>
            <td align="justify" valign="top" width="58%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="8%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="8%">&#160;</td>
          </tr>
          <tr>
            <td align="justify" valign="top" width="58%">
              <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">Basic
                and diluted net loss per common share</font></div>
            </td>
            <td align="right" valign="top" width="2%" style="border-bottom: black double;">
              <div align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$</font></div>
            </td>
            <td align="left" valign="top" width="8%" style="border-bottom: black double;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(0.40)</font></div>
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            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%" style="border-bottom: black double;">
              <div align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$</font></div>
            </td>
            <td align="left" valign="top" width="8%" style="border-bottom: black double;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(0.47)</font></div>
            </td>
          </tr>
          <tr>
            <td align="justify" valign="top" width="58%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="8%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="8%">&#160;</td>
          </tr>
          <tr>
            <td align="justify" valign="top" width="58%">
              <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">Basic
                and diluted weighted average shares outstanding</font></div>
            </td>
            <td align="right" valign="top" width="2%" style="border-bottom: black double;">&#160;</td>
            <td align="left" valign="top" width="8%" style="border-bottom: black double;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">11,785</font></div>
            </td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%" style="border-bottom: black double;">&#160;</td>
            <td align="left" valign="top" width="8%" style="border-bottom: black double;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">11,330</font></div>
            </td>
          </tr>

      </table>
    </div>
    <div>&#160;</div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">See
      accompanying notes to the consolidated financial statements.</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></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: 8pt; FONT-FAMILY: "><strong>2</strong></font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
        </div>
      </div>
      <div id="HDR" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="center"><font size="2"><strong>CADIZ
        INC.</strong></font></div>
    </div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="center">&#160;</div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="center"><font size="2"><strong>CONSOLDIATED
      BALANCE SHEETS
      (UNAUDITED)</strong></font><br></div>
    <div style="LINE-HEIGHT: 1">
      <table cellpadding="0" cellspacing="0" width="100%">

          <tr style="line-height: 1;">
            <td align="left" colspan="3" valign="top" width="55%" style="border-bottom: black thin solid;">&#160;</td>
            <td colspan="2" valign="top" width="13%" style="border-bottom: black thin solid;">&#160;</td>
            <td colspan="3" valign="top" width="15%" style="border-bottom: black thin solid;">&#160;</td>
          </tr>
          <tr style="line-height: 1;">
            <td align="left" colspan="3" valign="top" width="55%">&#160;</td>
            <td colspan="2" valign="top" width="13%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: -0.9pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>June
                30,</strong></font></div>
            </td>
            <td colspan="3" valign="top" width="15%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>December
                31,</strong></font></div>
            </td>
          </tr>
          <tr>
            <td align="left" colspan="3" valign="top" width="55%" style="border-bottom: black thin solid;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><em>($
                in thousands)</em></strong></font></div>
            </td>
            <td colspan="2" valign="top" width="13%" style="border-bottom: black thin solid;">
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            </td>
            <td colspan="3" valign="top" width="15%" style="border-bottom: black thin solid;">
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            <td align="left" colspan="3" valign="top" width="55%">&#160;</td>
            <td align="left" colspan="2" valign="top" width="13%">&#160;</td>
            <td align="left" colspan="3" valign="top" width="15%">&#160;</td>
          </tr>
          <tr style="line-height: 1;">
            <td align="left" colspan="3" valign="top" width="55%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>ASSETS</strong></font></div>
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            <td align="left" colspan="2" valign="top" width="13%">&#160;</td>
            <td align="left" colspan="3" valign="top" width="15%">&#160;</td>
          </tr>
          <tr style="line-height: 1;">
            <td align="left" colspan="3" valign="top" width="55%">&#160;</td>
            <td align="left" colspan="2" valign="top" width="13%">&#160;</td>
            <td align="left" colspan="3" valign="top" width="15%">&#160;</td>
          </tr>
          <tr style="line-height: 1;">
            <td align="left" colspan="3" valign="top" width="55%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Current
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            <td align="left" colspan="2" valign="top" width="13%">&#160;</td>
            <td align="left" colspan="3" valign="top" width="15%">&#160;</td>
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          <tr style="line-height: 1;">
            <td align="left" colspan="3" valign="top" width="55%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 18pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Cash
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            <td align="right" valign="top" width="3%">
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            <td align="left" valign="top" width="10%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">4,098</font></div>
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            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="right" valign="top" width="3%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$</font></div>
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            <td align="left" valign="top" width="9%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">10,397</font></div>
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          <tr style="line-height: 1;">
            <td align="left" colspan="3" valign="top" width="55%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 18pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Marketable
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            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="left" valign="top" width="10%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">8,658</font></div>
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            <td align="right" valign="top" width="3%">
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            </td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="left" valign="top" width="9%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">-</font></div>
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          <tr style="line-height: 1;">
            <td align="left" colspan="3" valign="top" width="55%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 18pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Accounts
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            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="left" valign="top" width="10%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">15</font></div>
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            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="left" valign="top" width="9%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">301</font></div>
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          <tr style="line-height: 1;">
            <td align="left" colspan="3" valign="top" width="55%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 18pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Prepaid
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            <td align="right" valign="top" width="3%" style="border-bottom: black thin solid;">&#160;</td>
            <td align="left" valign="top" width="10%" style="border-bottom: black thin solid;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">518</font></div>
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            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="right" valign="top" width="3%" style="border-bottom: black thin solid;">&#160;</td>
            <td align="left" valign="top" width="9%" style="border-bottom: black thin solid;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">243</font></div>
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          </tr>
          <tr style="line-height: 1;">
            <td align="left" colspan="3" valign="top" width="55%">&#160;</td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="left" valign="top" width="10%">&#160;</td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="left" valign="top" width="9%">&#160;</td>
          </tr>
          <tr style="line-height: 1;">
            <td align="left" colspan="3" valign="top" width="55%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 18pt"></font><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Total
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            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="left" valign="top" width="10%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">13,289</font></div>
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            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="left" valign="top" width="9%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">10,941</font></div>
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          <tr style="line-height: 1;">
            <td align="left" colspan="3" valign="top" width="55%">&#160;</td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="left" valign="top" width="10%">&#160;</td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="left" valign="top" width="9%">&#160;</td>
          </tr>
          <tr style="line-height: 1;">
            <td align="left" colspan="3" valign="top" width="55%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Property,
                plant, equipment and water programs, net</font></div>
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            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="left" valign="top" width="10%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">35,290</font></div>
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            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="left" valign="top" width="9%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">35,190</font></div>
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          </tr>
          <tr style="line-height: 1;">
            <td align="left" colspan="3" valign="top" width="55%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Goodwill</font></div>
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            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="left" valign="top" width="10%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">3,813</font></div>
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            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="left" valign="top" width="9%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">3,813</font></div>
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          </tr>
          <tr style="line-height: 1;">
            <td align="left" colspan="3" valign="top" width="55%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Other
                assets</font></div>
            </td>
            <td align="right" valign="top" width="3%" style="border-bottom: black thin solid;">&#160;</td>
            <td align="left" valign="top" width="10%" style="border-bottom: black thin solid;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">603</font></div>
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            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="right" valign="top" width="3%" style="border-bottom: black thin solid;">&#160;</td>
            <td align="left" valign="top" width="9%" style="border-bottom: black thin solid;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">382</font></div>
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          </tr>
          <tr style="line-height: 1;">
            <td align="left" colspan="3" valign="top" width="55%">&#160;</td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="left" valign="top" width="10%">&#160;</td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="left" valign="top" width="9%">&#160;</td>
          </tr>
          <tr style="line-height: 1;">
            <td align="left" colspan="3" valign="top" width="55%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 18pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Total
                Assets</font></div>
            </td>
            <td align="right" valign="top" width="3%" style="border-bottom: black double;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: -0.9pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$</font></div>
            </td>
            <td align="left" valign="top" width="10%" style="border-bottom: black double;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">52,995</font></div>
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            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="right" valign="top" width="3%" style="border-bottom: black double;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$</font></div>
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            <td align="left" valign="top" width="9%" style="border-bottom: black double;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">50,326</font></div>
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          </tr>
          <tr style="line-height: 1;">
            <td align="left" colspan="3" valign="top" width="55%">&#160;</td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="left" valign="top" width="10%">&#160;</td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="left" valign="top" width="9%">&#160;</td>
          </tr>
          <tr style="line-height: 1;">
            <td colspan="3" valign="top" width="55%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>LIABILITIES
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            </td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="left" valign="top" width="10%">&#160;</td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="left" valign="top" width="9%">&#160;</td>
          </tr>
          <tr style="line-height: 1;">
            <td align="left" colspan="3" valign="top" width="55%">&#160;</td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="left" valign="top" width="10%">&#160;</td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="left" valign="top" width="9%">&#160;</td>
          </tr>
          <tr style="line-height: 1;">
            <td align="left" colspan="3" valign="top" width="55%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Current
                liabilities:</font></div>
            </td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="left" valign="top" width="10%">
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right">&#160;</div>
            </td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="left" valign="top" width="9%">&#160;</td>
          </tr>
          <tr style="line-height: 1;">
            <td align="left" colspan="3" valign="top" width="55%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 18pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Accounts
                payable</font></div>
            </td>
            <td align="right" valign="top" width="3%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: -0.9pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$</font></div>
            </td>
            <td align="left" valign="top" width="10%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">343</font></div>
            </td>
            <td align="right" valign="top" width="3%">
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right">&#160;</div>
            </td>
            <td align="right" valign="top" width="3%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$</font></div>
            </td>
            <td align="left" valign="top" width="9%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">444</font></div>
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          </tr>
          <tr style="line-height: 1;">
            <td align="left" colspan="3" valign="top" width="55%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 18pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Accrued
                liabilities</font></div>
            </td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="left" valign="top" width="10%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">811</font></div>
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            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="left" valign="top" width="9%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">380</font></div>
            </td>
          </tr>
          <tr style="line-height: 1;">
            <td align="left" colspan="3" valign="top" width="55%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 18pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Current
                portion of long term debt</font></div>
            </td>
            <td align="right" valign="top" width="3%" style="border-bottom: black thin solid;">&#160;</td>
            <td align="left" valign="top" width="10%" style="border-bottom: black thin solid;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">9</font></div>
            </td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="right" valign="top" width="3%" style="border-bottom: black thin solid;">&#160;</td>
            <td align="left" valign="top" width="9%" style="border-bottom: black thin solid;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">9</font></div>
            </td>
          </tr>
          <tr style="line-height: 1;">
            <td align="left" colspan="3" valign="top" width="55%">&#160;</td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="left" valign="top" width="10%">&#160;</td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="left" valign="top" width="9%">&#160;</td>
          </tr>
          <tr style="line-height: 1;">
            <td align="left" colspan="3" valign="top" width="55%">
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            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="left" valign="top" width="10%">
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            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="left" valign="top" width="9%">
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            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="left" valign="top" width="10%">&#160;</td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="left" valign="top" width="9%">&#160;</td>
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          <tr style="line-height: 1;">
            <td align="left" colspan="3" valign="top" width="55%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Long-term
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              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">27,681</font></div>
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            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="right" valign="top" width="3%" style="border-bottom: black thin solid;">&#160;</td>
            <td align="left" valign="top" width="9%" style="border-bottom: black thin solid;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">25,881</font></div>
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          <tr style="line-height: 1;">
            <td align="left" colspan="3" valign="top" width="55%">&#160;</td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="left" valign="top" width="10%">&#160;</td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="left" valign="top" width="9%">&#160;</td>
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          <tr style="line-height: 1;">
            <td align="left" colspan="3" valign="top" width="55%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 18pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Total
                Liabilities</font></div>
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            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="left" valign="top" width="10%">
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            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="left" valign="top" width="9%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">26,714</font></div>
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            <td align="left" colspan="3" valign="top" width="55%">&#160;</td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="left" valign="top" width="10%">&#160;</td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="left" valign="top" width="9%">&#160;</td>
          </tr>
          <tr style="line-height: 1;">
            <td align="left" colspan="3" valign="top" width="55%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Commitments
                and contingencies</font></div>
            </td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="left" valign="top" width="10%">&#160;</td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="left" valign="top" width="9%">&#160;</td>
          </tr>
          <tr style="line-height: 1;">
            <td align="left" colspan="3" valign="top" width="55%">&#160;</td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="left" valign="top" width="10%">&#160;</td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="left" valign="top" width="9%">&#160;</td>
          </tr>
          <tr style="line-height: 1;">
            <td align="left" colspan="3" valign="top" width="55%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Stockholders&#8217;
                equity: </font></div>
            </td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="left" valign="top" width="10%">&#160;</td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="left" valign="top" width="9%">&#160;</td>
          </tr>
          <tr style="line-height: 1;">
            <td align="left" colspan="3" valign="top" width="55%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Series
                F convertible preferred stock - $.01 par value:&#160; <font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">100,000
                shares authorized; shares issued and outstanding - <font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">none
                at June 30, 2007 and 1,000 at December 31,
                2006</font></font></font></div>
            </td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="left" valign="top" width="10%">&#160;

              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">-</font></div>
            </td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="left" valign="top" width="9%">&#160;

              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">-</font></div>
            </td>
          </tr>
          <tr style="line-height: 1;">
            <td align="left" colspan="3" valign="top" width="55%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Common
                    stock - $.01 par value; 70,000,000 shares authorized; shares
                    issued and
                    outstanding - 11,903,611 at June 30, 2007 and 11,536,597 at December
                    31,
                    2006</font></div>
                </div>
              </div>
            </td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="left" valign="top" width="10%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">119</font></div>
            </td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="left" valign="top" width="9%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">116</font></div>
            </td>
          </tr>
          <tr style="line-height: 1;">
            <td align="left" colspan="3" valign="top" width="55%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Additional
                paid-in capital</font></div>
            </td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="left" valign="top" width="10%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">250,476</font></div>
            </td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="left" valign="top" width="9%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">245,206</font></div>
            </td>
          </tr>
          <tr style="line-height: 1;">
            <td align="left" colspan="3" valign="top" width="55%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Accumulated
                deficit</font></div>
            </td>
            <td align="right" valign="top" width="3%" style="border-bottom: black thin solid;">&#160;</td>
            <td align="left" valign="top" width="10%" style="border-bottom: black thin solid;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(226,444)</font></div>
            </td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="right" valign="top" width="3%" style="border-bottom: black thin solid;">&#160;</td>
            <td align="left" valign="top" width="9%" style="border-bottom: black thin solid;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(221,710)</font></div>
            </td>
          </tr>
          <tr style="line-height: 1;">
            <td align="left" colspan="3" valign="top" width="55%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 18pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Total
                stockholders&#8217; equity</font></div>
            </td>
            <td align="right" valign="top" width="3%" style="border-bottom: black thin solid;">&#160;</td>
            <td align="left" valign="top" width="10%" style="border-bottom: black thin solid;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">24,151</font></div>
            </td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="right" valign="top" width="3%" style="border-bottom: black thin solid;">&#160;</td>
            <td align="left" valign="top" width="9%" style="border-bottom: black thin solid;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">23,612</font></div>
            </td>
          </tr>
          <tr style="line-height: 1;">
            <td align="left" colspan="3" valign="top" width="55%">&#160;</td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="left" valign="top" width="10%">&#160;</td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="left" valign="top" width="9%">&#160;</td>
          </tr>
          <tr style="line-height: 1;">
            <td align="left" colspan="3" valign="top" width="55%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 18pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Total
                Liabilities and Stockholders&#8217; equity</font></div>
            </td>
            <td align="right" valign="top" width="3%" style="border-bottom: black double;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: -0.9pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$</font></div>
            </td>
            <td align="left" valign="top" width="10%" style="border-bottom: black double;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">52,995</font></div>
            </td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="right" valign="top" width="3%" style="border-bottom: black double;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$</font></div>
            </td>
            <td align="left" valign="top" width="9%" style="border-bottom: black double;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">50,326</font></div>
            </td>
          </tr>
          <tr style="line-height: 1;">
            <td align="left" valign="top" width="36%">&#160;</td>
            <td align="left" valign="top" width="12%">&#160;</td>
            <td align="left" colspan="7" valign="top" width="35%">&#160;</td>
          </tr>

      </table>
    </div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">See
      accompanying notes to the consolidated financial statements.</font></div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="center">&#160;</div>
    <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
      <div id="PN" style="PAGE-BREAK-AFTER: always; LINE-HEIGHT: 1">
        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: "><strong>3</strong></font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
        </div>
      </div>
      <div id="HDR" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="center"><font size="2"><strong>CADIZ
        INC.</strong></font></div>
    </div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="center">&#160;</div>
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="center"><font size="2"><strong>CONSOLIDATED
      STATEMENTS OF CASH FLOWS
      (UNAUDITED)</strong></font><br></div>
    <div style="LINE-HEIGHT: 1">
      <table cellpadding="0" cellspacing="0" width="100%">

          <tr style="line-height: 1;">
            <td align="right" valign="top" width="58%" style="border-bottom: black thin solid;">&#160;</td>
            <td colspan="5" valign="top" width="21%" style="border-bottom: black thin solid;">&#160;</td>
          </tr>
          <tr style="line-height: 1;">
            <td align="right" valign="top" width="58%">&#160;</td>
            <td colspan="5" valign="top" width="21%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>For
                the Six Months</strong></font></div>
            </td>
          </tr>
          <tr style="line-height: 1;">
            <td align="right" valign="top" width="58%">&#160;</td>
            <td colspan="5" valign="top" width="21%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Ended
                June 30,</strong></font></div>
            </td>
          </tr>
          <tr style="line-height: 1;">
            <td align="left" valign="top" width="58%" style="border-bottom: black thin solid;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><em>($
                in thousands except per share data)</em></strong></font></div>
            </td>
            <td colspan="2" valign="top" width="9%" style="border-bottom: black thin solid;">
              <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>2007</strong></font></div>
            </td>
            <td valign="top" width="3%" style="border-bottom: black thin solid;">&#160;</td>
            <td colspan="2" valign="top" width="9%" style="border-bottom: black thin solid;">
              <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>2006</strong></font></div>
            </td>
          </tr>
          <tr style="line-height: 1;">
            <td align="left" valign="top" width="58%">&#160;</td>
            <td colspan="2" valign="top" width="9%">&#160;</td>
            <td valign="top" width="3%">&#160;</td>
            <td colspan="2" valign="top" width="9%">&#160;</td>
          </tr>
          <tr style="line-height: 1;">
            <td align="left" valign="top" width="58%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Cash
                flows from operating activities:</font></div>
            </td>
            <td colspan="2" valign="top" width="9%">&#160;</td>
            <td valign="top" width="3%">&#160;</td>
            <td colspan="2" valign="top" width="9%">&#160;</td>
          </tr>
          <tr style="line-height: 1;">
            <td align="left" valign="top" width="58%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 18pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Net
                loss</font></div>
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 18pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Adjustments
                to reconcile net loss to</font></div>
            </td>
            <td align="right" valign="top" width="2%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$</font></div>
            </td>
            <td align="left" valign="top" width="8%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(4,734)</font></div>
            </td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="right" valign="top" width="2%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$</font></div>
            </td>
            <td align="left" valign="top" width="7%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(5,376)</font></div>
            </td>
          </tr>
          <tr style="line-height: 1;">
            <td align="left" valign="top" width="58%">
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            <td align="left" valign="top" width="7%" style="border-bottom: black thin solid;">
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            <td align="left" valign="top" width="58%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
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            <td align="left" valign="top" width="8%" style="border-bottom: black thin solid;">
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            <td align="right" valign="top" width="2%" style="border-bottom: black thin solid;">&#160;</td>
            <td align="left" valign="top" width="7%" style="border-bottom: black thin solid;">
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            <td align="left" valign="top" width="8%">&#160;</td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="7%">&#160;</td>
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          <tr style="line-height: 1;">
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            <td align="right" valign="top" width="3%">&#160;</td>
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            <td align="left" valign="top" width="7%">&#160;</td>
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              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">-</font></div>
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            <td align="left" valign="top" width="7%" style="border-bottom: black thin solid;">
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            <td align="left" valign="top" width="8%">&#160;</td>
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              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Cash
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            <td align="right" valign="top" width="3%">&#160;</td>
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            <td align="left" valign="top" width="7%">&#160;</td>
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              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 18pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Net
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              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 18pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Net
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              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">-</font></div>
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              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 18pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Debt
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              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(409)</font></div>
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            <td align="right" valign="top" width="2%" style="border-bottom: black thin solid;">&#160;</td>
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            <td align="left" valign="top" width="7%" style="border-bottom: black thin solid;">
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            <td align="left" valign="top" width="8%">&#160;</td>
            <td align="right" valign="top" width="3%">&#160;</td>
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            <td align="left" valign="top" width="7%">&#160;</td>
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            <td align="left" valign="top" width="58%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 18pt"></font><font id="TAB1" style="MARGIN-LEFT: 9pt"></font><font id="TAB1" style="MARGIN-LEFT: 9pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Net
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            <td align="right" valign="top" width="2%" style="border-bottom: black thin solid;">&#160;</td>
            <td align="left" valign="top" width="8%" style="border-bottom: black thin solid;">
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            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="right" valign="top" width="2%" style="border-bottom: black thin solid;">&#160;</td>
            <td align="left" valign="top" width="7%" style="border-bottom: black thin solid;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">9,324</font></div>
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            <td align="left" valign="top" width="58%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="8%">&#160;</td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="7%">&#160;</td>
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          <tr style="line-height: 1;">
            <td align="left" valign="top" width="58%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Net
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            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="8%">
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            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
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              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">7,037</font></div>
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            <td align="left" valign="top" width="58%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="8%">&#160;</td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="7%">&#160;</td>
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          <tr style="line-height: 1;">
            <td align="left" valign="top" width="58%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Cash
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            <td align="right" valign="top" width="2%" style="border-bottom: black thin solid;">&#160;</td>
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              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">10,397</font></div>
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            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="right" valign="top" width="2%" style="border-bottom: black thin solid;">&#160;</td>
            <td align="left" valign="top" width="7%" style="border-bottom: black thin solid;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">5,302</font></div>
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            <td align="left" valign="top" width="58%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="8%">&#160;</td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="7%">&#160;</td>
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          <tr style="line-height: 1;">
            <td align="left" valign="top" width="58%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Cash
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            <td align="right" valign="top" width="2%" style="border-bottom: black double;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$</font></div>
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            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="right" valign="top" width="2%" style="border-bottom: black double;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$</font></div>
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      </table>
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    <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">See
      accompanying notes to the consolidated financial statements.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1; MARGIN-RIGHT: 0pt" align="center">&#160;</div>
    <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
      <div id="PN" style="PAGE-BREAK-AFTER: always; LINE-HEIGHT: 1">
        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: "><strong>4</strong></font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
        </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="center"><font size="2"><strong>CADIZ
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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">
      <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center">&#160;</div>
      <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font size="2"><strong>CONSOLIDATED
        STATEMENTS OF STOCKHOLDERS'
        EQUITY (UNAUDITED)</strong></font><br></div>
    </div>
    <div>
      <table cellpadding="0" cellspacing="0" width="100%">

          <tr>
            <td align="left" colspan="23" valign="top" width="83%">&#160;</td>
          </tr>
          <tr>
            <td align="left" colspan="23" valign="top" width="83%">
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            </td>
          </tr>
          <tr>
            <td align="left" colspan="23" valign="top" width="83%">
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                in thousands)</em></font></div>
            </td>
          </tr>
          <tr>
            <td colspan="14" valign="top" width="50%">&#160;</td>
            <td colspan="3" valign="top" width="11%">
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            </td>
            <td colspan="3" valign="top" width="11%">&#160;</td>
            <td colspan="3" valign="top" width="10%">
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            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="16%">&#160;</td>
            <td colspan="6" valign="top" width="14%">
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            </td>
            <td colspan="7" valign="top" width="20%">
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          <tr>
            <td align="left" valign="top" width="16%">&#160;</td>
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              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: -9pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><u>Shares</u></strong></font></div>
            </td>
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            </td>
            <td colspan="3" valign="top" width="11%">
              <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><u>Shares</u></strong></font></div>
            </td>
            <td colspan="4" valign="top" width="9%">
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            <td colspan="3" valign="top" width="11%">
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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>
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            <td align="left" colspan="2" valign="top" width="7%">&#160;</td>
            <td align="left" colspan="4" valign="top" width="7%">&#160;</td>
            <td align="left" colspan="3" valign="top" width="11%">&#160;</td>
            <td align="left" colspan="4" valign="top" width="9%">&#160;</td>
            <td align="left" colspan="3" valign="top" width="11%">&#160;</td>
            <td align="left" colspan="3" valign="top" width="11%">&#160;</td>
            <td align="left" colspan="3" valign="top" width="10%">&#160;</td>
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            <td align="left" valign="top" width="16%">
              <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">Balance
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            <td align="right" colspan="2" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%">
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            <td align="right" valign="top" width="4%">
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            <td align="right" colspan="2" valign="top" width="2%">&#160;</td>
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            <td align="right" valign="top" width="7%">
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            <td align="left" valign="top" width="2%">
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            <td align="right" valign="top" width="2%">
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            <td align="right" valign="top" width="6%">
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            <td align="left" valign="top" width="16%">&#160;</td>
            <td align="left" valign="top" width="6%">&#160;</td>
            <td align="right" colspan="2" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="4%">&#160;</td>
            <td align="right" colspan="2" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="9%">&#160;</td>
            <td align="left" colspan="2" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="4%">&#160;</td>
            <td align="right" colspan="2" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="7%">&#160;</td>
            <td align="left" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="7%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="6%">&#160;</td>
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          <tr>
            <td align="left" valign="top" width="16%">
              <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">Warrants
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            <td align="left" valign="top" width="6%">
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            <td align="right" colspan="2" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="4%">
              <div align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">-</font></div>
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            <td align="right" colspan="2" valign="top" width="2%">&#160;</td>
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            <td align="left" colspan="2" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="4%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">3</font></div>
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            <td align="right" colspan="2" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="7%">
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            <td align="left" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="7%">
              <div align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">-</font></div>
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            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="6%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: -9pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">5,031</font></div>
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          <tr>
            <td align="left" valign="top" width="16%">
              <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">Stock
                awards and options exercised</font></div>
            </td>
            <td align="left" valign="top" width="6%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: -9pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">-</font></div>
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            <td align="right" colspan="2" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="4%">
              <div align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">-</font></div>
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            <td align="right" colspan="2" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="9%">
              <div><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">14,285</font></div>
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            <td align="left" colspan="2" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="4%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">-</font></div>
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            <td align="right" colspan="2" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="7%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">140</font></div>
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            <td align="left" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="7%">
              <div align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">-</font></div>
            </td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="6%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: -9pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">140</font></div>
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          </tr>
          <tr>
            <td align="left" valign="top" width="16%">
              <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: -9pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Series
                F preferred stock converted to common stock</font></div>
            </td>
            <td align="left" valign="top" width="6%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: -9pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: -9pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(1,000)</font></div>
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            <td align="right" colspan="2" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="4%">
              <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="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">-</font></div>
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            <td align="right" colspan="2" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="9%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: -9pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: -1.8pt" align="right">&#160;</div>
              <div><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">17,289</font></div>
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            <td align="left" colspan="2" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="4%">
              <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="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">-</font></div>
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            <td align="right" colspan="2" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</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">&#160;</div>
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">-</font></div>
            </td>
            <td align="left" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="2%">&#160;</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">&#160;</div>
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">-</font></div>
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            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <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">&#160;</div>
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">-</font></div>
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          </tr>
          <tr>
            <td align="left" valign="top" width="16%">&#160;</td>
            <td align="left" valign="top" width="6%">&#160;</td>
            <td align="right" colspan="2" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="4%">&#160;</td>
            <td align="right" colspan="2" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="9%">&#160;</td>
            <td align="left" colspan="2" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="4%">&#160;</td>
            <td align="right" colspan="2" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="7%">&#160;</td>
            <td align="left" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="7%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="6%">&#160;</td>
          </tr>
          <tr>
            <td align="left" valign="top" width="16%">
              <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: -9pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Stock
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            </td>
            <td align="left" valign="top" width="6%">
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;-</font></div>
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            <td align="right" colspan="2" valign="top" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
            <td align="right" valign="top" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
            <td align="left" valign="top" width="4%">
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;-</font></div>
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            <td align="right" colspan="2" valign="top" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
            <td align="right" valign="top" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">-</font></td>
            <td align="left" colspan="2" valign="top" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
            <td align="right" valign="top" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
            <td align="left" valign="top" width="4%">
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;-</font></div>
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            <td align="right" colspan="2" valign="top" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
            <td align="right" valign="top" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
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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 align="left" valign="top" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
            <td align="right" valign="top" width="7%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">-&#160;</font></td>
            <td align="right" valign="top" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
            <td align="right" valign="top" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
            <td align="right" valign="top" width="6%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">102&#160;</font></td>
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          <tr>
            <td align="left" valign="top" width="16%">
              <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">Net
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            <td align="left" valign="top" width="6%" style="border-bottom: black thin solid;">
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            <td align="right" colspan="2" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%" style="border-bottom: black thin solid;">&#160;</td>
            <td align="right" valign="top" width="4%" style="border-bottom: black thin solid;">
              <div align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">-</font></div>
            </td>
            <td align="right" colspan="2" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="9%" style="border-bottom: black thin solid;">
              <div><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">-</font></div>
            </td>
            <td align="right" colspan="2" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%" style="border-bottom: black thin solid;">&#160;</td>
            <td align="right" valign="top" width="4%" style="border-bottom: black thin solid;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">-</font></div>
            </td>
            <td align="right" colspan="2" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%" style="border-bottom: black thin solid;">&#160;</td>
            <td align="right" valign="top" width="7%" style="border-bottom: black thin solid;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">-</font></div>
            </td>
            <td align="left" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="2%" style="border-bottom: black thin solid;">&#160;</td>
            <td align="right" valign="top" width="7%" style="border-bottom: black thin solid;">
              <div align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(4,734)</font></div>
            </td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%" style="border-bottom: black thin solid;">&#160;</td>
            <td align="right" valign="top" width="6%" style="border-bottom: black thin solid;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: -9pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(4,734)</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="16%">&#160;</td>
            <td align="left" valign="top" width="6%">&#160;</td>
            <td align="right" colspan="2" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="4%">&#160;</td>
            <td align="right" colspan="2" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="9%">&#160;</td>
            <td align="left" colspan="2" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="4%">&#160;</td>
            <td align="right" colspan="2" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="7%">&#160;</td>
            <td align="left" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="7%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="6%">&#160;</td>
          </tr>
          <tr>
            <td align="left" valign="top" width="16%">
              <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">Balance
                as of June 30, 2007</font></div>
            </td>
            <td align="left" valign="top" width="6%" style="border-bottom: black double;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: -9pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">-</font></div>
            </td>
            <td align="right" colspan="2" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%" style="border-bottom: black double;">
              <div align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$</font></div>
            </td>
            <td align="right" valign="top" width="4%" style="border-bottom: black double;">
              <div align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">-</font></div>
            </td>
            <td align="right" colspan="2" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="9%" style="border-bottom: black double;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: -9pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: -1.8pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">11,903,611</font></div>
            </td>
            <td align="right" colspan="2" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%" style="border-bottom: black double;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: -9pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$</font></div>
            </td>
            <td align="right" valign="top" width="4%" style="border-bottom: black double;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">119</font></div>
            </td>
            <td align="right" colspan="2" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%" style="border-bottom: black double;">
              <div align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$</font></div>
            </td>
            <td align="right" valign="top" width="7%" style="border-bottom: black double;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">250,476</font></div>
            </td>
            <td align="left" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="2%" style="border-bottom: black double;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: -9pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$</font></div>
            </td>
            <td align="right" valign="top" width="7%" style="border-bottom: black double;">
              <div align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(226,444)</font></div>
            </td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%" style="border-bottom: black double;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: -9pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$</font></div>
            </td>
            <td align="right" valign="top" width="6%" style="border-bottom: black double;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: -9pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">24,151</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"><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">See
      accompanying notes to the consolidated financial statements.</font></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: 8pt; FONT-FAMILY: "><strong>5</strong></font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
        </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="center"><font size="2"><strong>CADIZ
      INC.</strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">
      <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center">&#160;</div>
      <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font size="2"><strong>NOTES
        TO THE CONSOLIDATED FINANCIAL
        STATEMENTS</strong></font></div>
      <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center">&#160;</div>
      <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><u>NOTE
        1 - DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
        </u></strong></font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><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"><strong><em>Description
      of Business </em></strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      Consolidated Financial Statements have been prepared by Cadiz Inc., sometimes
      referred to as &#8220;Cadiz&#8221; or &#8220;the Company&#8221;, without audit and should be read in
      conjunction with the Consolidated Financial Statements and notes thereto
      included in the Company&#8217;s Form 10-K for the year ended December 31,
      2006.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      foregoing Consolidated Financial Statements include the accounts of the Company
      and contain all adjustments, consisting only of normal recurring adjustments,
      which the Company considers necessary for a fair presentation of the Company&#8217;s
      financial position, the results of its operations and its cash flows for the
      periods presented and have been prepared in accordance with generally accepted
      accounting principles. The year-end condensed balance sheet data was derived
      from audited financial statements, but does not include all disclosures required
      by generally accepted accounting principles.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      preparation of financial statements in conformity with generally accepted
      accounting principles requires management to make estimates and assumptions
      that
      affect the amounts reported in the financial statements and the accompanying
      notes. Actual results could differ from those estimates and such differences
      may
      be material to the financial statements. This quarterly report on Form 10-Q
      should be read in conjunction with the Company&#8217;s Form 10-K for the year ended
      December&#160;31, 2006. The results of operations for the six months ended June
      30, 2007 are not necessarily indicative of results for the entire fiscal year
      ended December&#160;31, 2007. </font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><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"><strong><em>Basis
      of Presentation</em></strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      financial statements of the Company have been prepared using accounting
      principles applicable to a going concern, which assumes realization of assets
      and settlement of liabilities in the normal course of business. The Company
      incurred losses of $4.7 million for the six months ended June 30, 2007 and
      $5.4
      million for the six months ended June 30, 2006. The Company had working capital
      of $12.1 million at June 30, 2007 and used cash in operations of $2.6 million
      for the six months ended June 30, 2007 and $2.3 million for the six months
      ended
      June 30, 2006. Currently, the Company's sole focus is the development of its
      land and water assets.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
      2006,
      the Company refinanced its long term debt with a new $36.4 million zero coupon
      senior secured convertible term loan that matures on June 29, 2011. The new
      loan
      provided $9.3 million of additional funds after repayment of the Company&#8217;s prior
      credit facility and certain transaction fees. The Company also received $1.1
      million in September 2006, when certain holders of warrants issued in 2004
      exercised their right to purchase 70,000 common shares at $15.00 per share.
      In
      2007, the Company exercised its right to terminate the remaining warrants on
      March 2, 2007, subject to a 30 day notice period. In response, the remaining
      warrant holders exercised their right to purchase 335,440 shares of the
      Company&#8217;s common stock during the notice period, and the Company received an
      additional $5.0 million from the sale of these shares. Following this exercise,
      no Warrants remain outstanding.</font></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: 8pt; FONT-FAMILY: "><strong>6</strong></font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
        </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: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Based
      on
      current forecasts, the Company believes it has sufficient resources to fund
      operations for more than one year. The Company&#8217;s current resources do not
      provide the capital necessary to fund a water or real estate development project
      should the Company be required to do so. There is no assurance that additional
      financing (public or private) will be available on acceptable terms or at all.
      If the Company issues additional equity securities to raise funds, the ownership
      percentage of the Company&#8217;s existing stockholders would be reduced. New
      investors may demand rights, preferences or privileges senior to those of
      existing holders of common stock. If the Company cannot raise needed funds,
      it
      might be forced to make further substantial reductions in its operating
      expenses, which could adversely affect its ability to implement its current
      business plan and ultimately its viability as a company. These financial
      statements do not include any adjustments that might result from these
      uncertainties.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
      part
      due to Metropolitan&#8217;s actions in 2002, the Company&#8217;s wholly-owned agricultural
      subsidiary, Sun World International Inc. ("SunWorld"), filed voluntary petitions
      for relief under Chapter 11 of the Bankruptcy Code on January 30, 2003. Sun
      World&#8217;s reorganization plan became effective in 2005, and the Company has no
      further liabilities related to the business or operations of Sun World. From
      the
      effective date of the plan through June 30, 2007, the Company has incurred
      losses of approximately $23.8 million and used cash in operations of $9.2
      million.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><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">&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><em>Principles
      of Consolidation</em></strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
      December 2003, the Company transferred substantially all of its assets with
      the
      exception of its office sublease, certain office furniture and equipment and
      the
      investment in Sun World to Cadiz Real Estate LLC, a Delaware limited liability
      company (&#8220;Cadiz Real Estate&#8221;). The Company holds 100% of the equity interests of
      Cadiz Real Estate, and therefore continues to hold 100% beneficial ownership
      of
      the properties that it transferred to Cadiz Real Estate. Because the transfer
      of
      the Company&#8217;s properties to Cadiz Real Estate has no effect on its ultimate
      beneficial ownership of these properties, the properties owned of record either
      by Cadiz Real Estate or by the Company are treated as belonging to the
      Company.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><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"><strong><em>Marketable
      Securities</em></strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      Company considers all highly liquid instruments with a maturity of three months
      or less when purchased to be cash and cash equivalents. Marketable securities
      consist of auction rate securities. Auction rate securities are long-term
      municipal bonds and preferred stock with interest rates that reset periodically
      through an auction process, which occurs in 7-, 28-, 35-, or 90-day periods.
      There are no cumulative gross unrealized holding gains or losses associated
      with
      these investments and all income is recorded as interest income.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><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"><strong><em>Goodwill</em></strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      Company has $3.8 million of goodwill which resulted from a merger in May 1988
      between two companies, which eventually became known as Cadiz Inc. Goodwill
      is
      not amortized but is tested for impairment annually in the first quarter, or
      earlier if events occur which require an impairment analysis to be performed.
      The Company performed an impairment test of its goodwill at December 31, 2006
      and determined that its goodwill was not impaired.</font></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: 8pt; FONT-FAMILY: "><strong>7</strong></font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
        </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="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><em>Series
      F Convertible Preferred Stock</em></strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">100,000
      shares of Series F convertible preferred stock were issued&#160;to ING Capital
      LLC (&#8220;ING&#8221;) in a December 2003 financing transaction, of which 1,000 shares
      remained outstanding on December 31, 2006. In June 2007, ING elected to convert
      the preferred shares into 17,289 shares of common stock. No Series F Preferred
      Shares were outstanding on June 30, 2007.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><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"><strong><em>Recent
      Accounting Pronouncements</em></strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
      June
      2006, the FASB issued FSP FIN 48 which clarifies the accounting for uncertainty
      in income taxes recognized in an enterprise&#8217;s financial statements in accordance
      with FASB Statement No. 109, &#8220;Accounting for Income Taxes.&#8221; This Interpretation
      prescribes a recognition threshold and measurement attribute for the financial
      statement recognition and measurement of a tax position taken or expected to
      be
      taken on a tax return. This Interpretation also provides guidance on
      derecognition, classification, interest, penalties, accounting in interim
      periods, disclosure and transition. The evaluation of a tax position in
      accordance with this Interpretation is a two-step process. The first step is
      to
      determine if it is more likely than not that a tax position will be sustained
      upon examination and should therefore be recognized. The second step is to
      measure a tax position that meets the more likely than not recognition threshold
      to determine the amount of benefit to recognize in the financial statements.
      Effective January 1, 2007, the Company&#8217;s financial statements reflect FSP FIN
      48. </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      adoption of </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">FSP
      FIN
      48</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">
      did not
      have a material impact on the Company&#8217;s financial statements.</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
      September 2006, the FASB released Statement of Financial Accounting Standards
      No. 157 (&#8220;SFAS No. 157&#8221;), &#8220;Fair Value Measurements". This statement defines fair
      value, establishes a framework for measuring fair value and expands disclosures
      about fair value measurements. SFAS No. 157 clarifies the exchange price notion
      in the fair value definition to mean the price that would be received to sell
      the asset or paid to transfer the liability (an exit price), not the price
      that
      would be paid to acquire the asset or received to assume the liability (an
      entry
      price). This statement also clarifies that market participant assumptions should
      include assumptions about risk, should include assumptions about the effect
      of a
      restriction on the sale or use of an asset and should reflect its nonperformance
      risk (the risk that the obligation will not be fulfilled). Nonperformance risk
      should include the reporting entity&#8217;s credit risk. SFAS No. 157 is effective for
      financial statements issued for fiscal years beginning after November 15, 2007.
      The Company will adopt SFAS No. 157 on January 1, 2008, as required, and
      management is still evaluating the impact on the Company&#8217;s consolidated
      financial statements.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
      February 2007, the FASB released Statement of Financial Accounting Standards
      No.
      159 (&#8220;SFAS No. 159), &#8220;The Fair Value Option for Financial Assets and Liabilities
      Including an Amendment of FASB Statement No. 115&#8221;. SFAS No. 159 permits entities
      to choose to measure certain financial assets and liabilities at fair value
      and
      is effective for the first fiscal year beginning after November 15, 2007. The
      Company will adopt SFAS No. 159 on January 1, 2008, as required, and management
      is still evaluating the impact on the Company&#8217;s consolidated financial
      statements.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">See
      Note
      2 to the Consolidated Financial Statements included in the Company&#8217;s Form 10-K
      for further discussion of the Company&#8217;s accounting policies.</font></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: 8pt; FONT-FAMILY: "><strong>8</strong></font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
        </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="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><u>NOTE
      2 - PROPERTY, PLANT, EQUIPMENT AND WATER PROGRAMS</u></strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Property,
      plant, equipment and water programs consist of the following (in
      thousands):</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div>
      <table cellpadding="0" cellspacing="0" width="100%">

          <tr>
            <td align="left" valign="top" width="52%">&#160;</td>
            <td colspan="2" valign="top" width="12%">
              <div align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>June
                30,</strong></font></div>
            </td>
            <td valign="top" width="2%">&#160;</td>
            <td colspan="2" valign="top" width="11%">
              <div align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>December
                31,</strong></font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="52%">&#160;</td>
            <td colspan="2" valign="top" width="12%">
              <div align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><u>2007</u></strong></font></div>
            </td>
            <td valign="top" width="2%">&#160;</td>
            <td colspan="2" valign="top" width="11%">
              <div align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><u>2006</u></strong></font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="52%">&#160;</td>
            <td align="left" colspan="2" valign="top" width="12%">&#160;</td>
            <td align="left" valign="top" width="2%">&#160;</td>
            <td align="left" colspan="2" valign="top" width="11%">&#160;</td>
          </tr>
          <tr>
            <td align="left" valign="top" width="52%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 72pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Land
                and land improvements</font></div>
            </td>
            <td align="right" valign="top" width="2%">
              <div align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$</font></div>
            </td>
            <td align="left" valign="top" width="10%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">22,024</font></div>
            </td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="3%">
              <div align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$</font></div>
            </td>
            <td align="left" valign="top" width="8%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">21,986</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="52%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 72pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Water
                programs</font></div>
            </td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="10%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">14,274</font></div>
            </td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="left" valign="top" width="8%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">14,274</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="52%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 72pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Buildings</font></div>
            </td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="10%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">1,191</font></div>
            </td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="left" valign="top" width="8%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">1,191</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="52%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 72pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Machinery
                and equipment</font></div>
            </td>
            <td align="right" valign="top" width="2%" style="border-bottom: black thin solid;">&#160;</td>
            <td align="left" valign="top" width="10%" style="border-bottom: black thin solid;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">864</font></div>
            </td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="3%" style="border-bottom: black thin solid;">&#160;</td>
            <td align="left" valign="top" width="8%" style="border-bottom: black thin solid;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">726</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="52%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="10%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">38,353</font></div>
            </td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="left" valign="top" width="8%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">38,177</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="52%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="10%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="left" valign="top" width="8%">&#160;</td>
          </tr>
          <tr>
            <td align="left" valign="top" width="52%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 72pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Less
                accumulated depreciation</font></div>
            </td>
            <td align="right" valign="top" width="2%" style="border-bottom: black thin solid;">&#160;</td>
            <td align="left" valign="top" width="10%" style="border-bottom: black thin solid;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(3,063)</font></div>
            </td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="3%" style="border-bottom: black thin solid;">&#160;</td>
            <td align="left" valign="top" width="8%" style="border-bottom: black thin solid;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(2,987)</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="52%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="10%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="3%">&#160;</td>
            <td align="left" valign="top" width="8%">&#160;</td>
          </tr>
          <tr>
            <td align="left" valign="top" width="52%">&#160;</td>
            <td align="right" valign="top" width="2%" style="border-bottom: black double;">
              <div align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$</font></div>
            </td>
            <td align="left" valign="top" width="10%" style="border-bottom: black double;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">35,290</font></div>
            </td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="3%" style="border-bottom: black double;">
              <div align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$</font></div>
            </td>
            <td align="left" valign="top" width="8%" style="border-bottom: black double;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">35,190</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"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Depreciation
      expense totaled $39 thousand during the three months ended June 30, 2007 and
      was
      the same amount during the prior year period. Depreciation expense totaled
      $76
      thousand and $79 thousand for the six months ended June 30, 2007 and 2006,
      respectively.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><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"><strong><u>NOTE
      3 - LONG-TERM DEBT</u></strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">At
      June
      30, 2007 and December 31, 2006, the carrying amount of the Company&#8217;s outstanding
      debt is summarized as follows (dollars in thousands): </font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div>
      <table cellpadding="0" cellspacing="0" width="100%">

          <tr>
            <td align="left" valign="top" width="54%">&#160;</td>
            <td colspan="2" valign="top" width="12%">
              <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"><strong>June
                30,</strong></font></div>
            </td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td colspan="2" valign="top" width="12%">
              <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"><strong>December
                31,</strong></font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="54%">&#160;</td>
            <td colspan="2" valign="top" width="12%">
              <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"><strong><u>2007</u></strong></font></div>
            </td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td colspan="2" valign="top" width="12%">
              <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"><strong><u>2006</u></strong></font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="54%">&#160;</td>
            <td align="left" colspan="2" valign="top" width="12%">&#160;</td>
            <td align="left" valign="top" width="2%">&#160;</td>
            <td align="left" colspan="2" valign="top" width="12%">&#160;</td>
          </tr>
          <tr>
            <td align="left" valign="top" width="54%">
              <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">Zero
                coupon secured convertible term loan due June 29, 2011.</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">Interest
                accruing at 5% per annum until June 29, 2009 and at 6%
                thereafter</font></div>
            </td>
            <td align="right" valign="top" width="2%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$</font></div>
            </td>
            <td align="left" valign="top" width="10%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">38,254</font></div>
            </td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="2%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$</font></div>
            </td>
            <td align="right" valign="top" width="9%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">37,316</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="54%">
              <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">Other
                loans</font></div>
            </td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="10%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">27</font></div>
            </td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="9%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">31</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="54%">
              <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">Debt
                Discount</font></div>
            </td>
            <td align="right" valign="top" width="2%" style="border-bottom: black thin solid;">&#160;</td>
            <td align="left" valign="top" width="10%" style="border-bottom: black thin solid;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(10,591)</font></div>
            </td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="2%" style="border-bottom: black thin solid;">&#160;</td>
            <td align="right" valign="top" width="9%" style="border-bottom: black thin solid;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(11,457)</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="54%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="10%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">27,690</font></div>
            </td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="9%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">25,890</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="54%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="10%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="9%">&#160;</td>
          </tr>
          <tr>
            <td align="left" valign="top" width="54%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 18pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Less
                current portion</font></div>
            </td>
            <td align="right" valign="top" width="2%" style="border-bottom: black thin solid;">&#160;</td>
            <td align="left" valign="top" width="10%" style="border-bottom: black thin solid;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">9</font></div>
            </td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="2%" style="border-bottom: black thin solid;">&#160;</td>
            <td align="right" valign="top" width="9%" style="border-bottom: black thin solid;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">9</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="54%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="10%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="9%">&#160;</td>
          </tr>
          <tr>
            <td align="left" valign="top" width="54%">&#160;</td>
            <td align="right" valign="top" width="2%" style="border-bottom: black double;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$</font></div>
            </td>
            <td align="left" valign="top" width="10%" style="border-bottom: black double;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">27,681</font></div>
            </td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="2%" style="border-bottom: black double;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$</font></div>
            </td>
            <td align="right" valign="top" width="9%" style="border-bottom: black double;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">25,881</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"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
      June
      2006, the Company entered into a $36.4 million five year zero coupon convertible
      term loan with Peloton Partners LLP, as administrative agent for the loan,
      and
      with an affiliate of Peloton and another investor, as lenders. Certain terms
      of
      the loan were </font></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: 8pt; FONT-FAMILY: "><strong>9</strong></font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
        </div>
      </div>
      <div id="HDR">
        <div id="GLHDR" style="WIDTH: 100%" align="right">
        </div><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">subsequently
        amended pursuant to Amendment #1 to the Credit Agreement, which was effective
        September 29, 2006. Under the terms of the loan, interest accrues at a 5%
        annual
        rate for the first 3 years and 6% thereafter, calculated on the basis of
        a
        360-day year and actual days elapsed. The entire amount of accrued interest
        is
        due at the final maturity of the loan in June, 2011. The term loan is
        collateralized by substantially all the assets of the Company and contains
        representations, warranties and covenants that are typical for agreements
        of
        this type, including restrictions that would limit the Company&#8217;s ability to
        incur additional indebtedness, incur liens, pay dividends or make restricted
        payments, dispose of assets, make investments and merge or consolidate with
        another person. However, there are no financial maintenance covenants and
        no
        restrictions on the Company&#8217;s ability to issue additional common stock to fund
        future working capital needs.</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">At
      the
      lender&#8217;s option, principal plus accrued interest is convertible into the
      Company&#8217;s $0.01 par value common stock. The loan is divided into two tranches:
      the $10 million Tranche A is convertible at $18.15 per share, and the $26.4
      million Tranche B is convertible at $23.10 per share. A maximum of 2,221,909
      shares are issuable pursuant to these conversion rights, with this maximum
      number applicable if the loan is converted on the final maturity date. The
      Company has more than sufficient authorized common shares available for this
      purpose and has filed a registration statement on Form S-3 covering the resale
      of all the securities issuable upon conversion of the loan.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
      the
      event of a change in control, the conversion prices are adjusted downward by
      a
      discount that declines over time such that, under a change in control scenario,
      both the Tranche A and Tranche B conversion prices were initially $16.50 per
      share and increase in a linear manner over time to the full $18.15 Tranche
      A
      conversion price and $23.10 Tranche B conversion price on the final maturity
      date. In no event does the maximum number of shares issuable to lenders pursuant
      to these revised conversion formulas exceed the 2,221,909 shares that would
      be
      issued to lenders pursuant to a conversion in full on the final maturity date
      in
      the absence of a change in control. </font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On
      or
      after June 29, 2007, principal and interest accrued on each of the two loan
      tranches can be prepaid on 30 days notice either if the price of the Company&#8217;s
      stock on the NASDAQ Global Market exceeds the tranche&#8217;s conversion price by 40%
      for 20 consecutive trading days in a 30 trading day period or if the Company
      completes the Cadiz Water Program entitlement process, secures a right-of-way
      for the project pipeline and arranges sufficient financing to repay the loan
      and
      build the Cadiz Project. The $10 million Tranche A prepayment option would
      become available at a share price above $25.41 per share and the Tranche B
      prepayment option would become available at a share price above $32.34 per
      share.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      Company has analyzed all of the above provisions of the convertible loan and
      related agreements for embedded derivatives under FASB Statement No. 133,
      Accounting for Derivative Instruments and Hedging Activities and related
      Emerging Issues Task Force (EITF) interpretations and SEC rules. The Company
      concluded that certain provisions of the convertible loan agreement, which
      were
      in effect prior to the first amendment date, may be deemed to be derivatives
      for
      purposes of the application of FASB Statement No. 133 and EITF 00-19: Accounting
      for Derivative Financial Instruments Indexed to, and Potentially Settled in,
      a
      Company&#8217;s Own Stock. Therefore, in accordance with FASB Statement No. 133, these
      embedded instruments were bifurcated from the host debt instrument and
      classified as a liability </font></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: 8pt; FONT-FAMILY: "><strong>10</strong></font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
        </div>
      </div>
      <div id="HDR">
        <div id="GLHDR" style="WIDTH: 100%" align="right">
        </div><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">in
        the
        Company&#8217;s financial statements. The Company prepared valuations for each of the
        deemed derivatives using a Black-Scholes option pricing model and recorded
        a
        liability of approximately $12.2 million on the June 30 loan funding date,
        with
        an offsetting discount to the convertible term loan.</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On
      June
      30, 2006, the derivative liability was classified and recorded as part of long
      term debt in the balance sheet. The debt discount will be amortized to interest
      expense over the life of the loan using the effective interest amortization
      method. The principal valuation assumptions are as follows:</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div>
      <table cellpadding="0" cellspacing="0" width="100%">

          <tr>
            <td align="left" valign="top" width="8%">&#160;</td>
            <td align="left" valign="top" 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">Loan
                balance available for conversion:</font></div>
            </td>
            <td align="justify" valign="top" width="34%">
              <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">$36.4
                million</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="8%">&#160;</td>
            <td align="left" valign="top" 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">Expected
                term:</font></div>
            </td>
            <td align="justify" valign="top" width="34%">
              <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">5
                years</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="8%">&#160;</td>
            <td align="left" valign="top" 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">Cadiz
                common share price:</font></div>
            </td>
            <td align="justify" valign="top" width="34%">
              <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">$17.01</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="8%">&#160;</td>
            <td align="left" valign="top" 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">Volatility:</font></div>
            </td>
            <td align="justify" valign="top" width="34%">
              <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">46%</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="8%">&#160;</td>
            <td align="left" valign="top" 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">Risk-free
                Interest Rate:</font></div>
            </td>
            <td align="justify" valign="top" width="34%">
              <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">5.18%</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="8%">&#160;</td>
            <td align="left" valign="top" 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">Change
                in control probability:</font></div>
            </td>
            <td align="justify" valign="top" width="34%">
              <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">10%</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"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On
      September 29, 2006 the terms of the loan were amended to modify the repayment
      and conversion options available to lenders upon a change in control of the
      Company, to clarify that the conversion feature was an unsecured obligation
      of
      the Company and to specifically limit the maximum number of shares to be issued
      upon conversion of the loan. With these modifications, it was determined that
      the requirement for bifurcation under SFAS 133 was no longer met and that the
      carrying value of the embedded derivatives should be reclassified to
      stockholder&#8217;s equity under EITF 06-7. The derivative liability was adjusted to
      fair value on the amendment date, and the $2,919,000 increase in fair value
      was
      recorded as an &#8220;Other Expense&#8221; item in the Consolidated Statement of Operations.
      The $15.2 million fair value of the derivative liability was then transferred
      to
      the Additional Paid-in Capital component of Stockholder&#8217;s Equity </font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      Company incurred $408,000 of outside legal expenses related to the negotiation
      and documentation of the loan, which will be amortized over the life of the
      loan
      using the interest amortization method.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      proceeds of the Peloton Loan were applied to repay in full the Company&#8217;s term
      loan facility with ING. As a result, ING retained the $762,000 remaining balance
      of the prepaid interest credit account, and the write-off of this asset was
      reflected in the &#8220;Other Expense&#8221; caption of the Statement of Operations in the
      fiscal quarter ended June 30, 2006. The write-off of $106,000 of unamortized
      debt issuance costs related to the ING loan was also reflected under &#8220;Other
      Expense&#8221; in the same fiscal period. No balance was outstanding after the ING
      loan repayment in June 2006.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">At
      June
      30, 2007 the Company was in compliance with its debt covenants under the Peloton
      Loan.</font></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: 8pt; FONT-FAMILY: "><strong>11</strong></font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
        </div>
      </div>
      <div id="HDR">
        <div id="GLHDR" style="WIDTH: 100%" align="right">
        </div><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><u>NOTE
        4 - STOCK-BASED COMPENSATION PLANS AND WARRANTS</u></strong></font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      Company has issued options and has granted stock awards pursuant to its 2003
      Management Equity Incentive Plan and its 2007 Management Equity Incentive Plan.
      The Company also has granted stock awards pursuant to its Outside Director
      Compensation Plan.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      2007
      Management Equity Incentive Plan was approved by stockholders at the June 15,
      2007 Annual Meeting. The plan provides for the grant and issuance of up to
      1,050,000 shares and options to the Company&#8217;s employees and consultants.&#160;
The plan became effective when the Company filed a registration statement on
      Form S-8 on July 25, 2007, and grants of 950,000 shares of common stock and
      options to purchase 7,661 shares of common stock became effective on that
      date.&#160; As discussed below, all grants are subject to vesting conditions,
      and certain grants are subject to&#160;additional market conditions.&#160;
</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><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"><strong><em>Stock
      Options Issued under the 2003 and 2007 Management Equity Incentive
      Plans</em></strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      2003
      Management Equity Incentive Plan provides for the granting of options for the
      purchase of 377,339 shares of common stock. Options issued under the Management
      Equity Incentive Plan were granted during 2005 and 2006. The options have a
      ten
      year term with vesting periods ranging from issuance date to three years.
      Certain of these options had strike prices that were below the fair market
      value
      of the Company&#8217;s common stock on the date of grant. All options have been issued
      to officers, employees and consultants of the Company. 365,000 options were
      granted under the plan during 2005, and the remaining 12,339 options were
      granted in 2006. Options to purchase 367,339 shares were unexercised and
      outstanding on June 30, 2007.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      Company recognized stock option related compensation costs of $75,000 and
      $443,000 in the six months ended June 30, 2007 and June 30, 2006, respectively.
      On June 30, 2007, the unamortized compensation expense related to these options
      amounted to $69,000 and is expected to be recognized in 2007 and 2008. Options
      to purchase 10,000 shares of stock for $13.95 per share were exercised during
      the six months ended June 30, 2007.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      Company granted options to purchase 7,661 common shares at a price of $20.00
      per
      share under the 2007 Management Equity Incentive Plan in July 2007. The options
      have a ten year term with vesting periods ranging from issuance date to two
      years.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><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"><strong><em>Stock
      Awards to Directors, Officer, Consultants and
      Employees</em></strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      Company has granted stock awards pursuant to its 2003 Management Equity
      Incentive Plan and Outside Director Compensation Plan. All of the shares
      issuable under the 2003 Management Equity Incentive Plan were awarded in May
      2005. </font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">14,701
      shares were awarded under the Outside Director Compensation Plan on November
      14,
      2006. 10,416 shares related to service in the plan years ending June 30, 2004
      and 2005 were issued immediately. 4,285 shares related to service in the plan
      year ending June 30, 2006 were issued on January 31, 2007.&#160; A 4,599 share
      grant for service during the plan year ending June 30, 2007 became effective
      on
      that date.&#160; The award will vest on January 31, 2008.&#160; </font></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: 8pt; FONT-FAMILY: "><strong>12</strong></font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
        </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: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      compensation cost of stock grants is measured at the quoted market price of
      the
      Company&#8217;s stock at the date of grant. The accompanying consolidated financial
      statements include $616,000 of stock based compensation expense related to
      stock
      based awards in the six months ended June 30, 2006. There was $27,000 of stock
      base compensation expense related to stock awards during the six months ending
      June 30, 2007, and there was no unamortized compensation expense relating to
      stock awards on that date.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">A
      grant
      of 950,000 shares under the 2007 Management Equity Incentive Plan became
      effective on July 25, 2007. The grant consists of 3 separate
      awards:</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">

          <tr valign="top" style="line-height: 1.25;">
            <td align="right" style="width: 54pt;"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Symbol, serif">-&#160;&#160;</font></td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">A
                150,000 share award that vests in 3 equal installments on January
                1, 2008,
                January 1, 2009 and January 1,
                2010.</font></div>
            </td>
          </tr>

      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">

          <tr valign="top" style="line-height: 1.25;">
            <td align="right" style="width: 54pt;"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Symbol, serif">-&#160;&#160;</font></td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">A
                400,000 share award that is available if the trading price of the
                Company&#8217;s stock is at least $28 per share for 10 trading days within any
                period of 30 consecutive trading days on or before March 12, 2009.
                This
                award would vest in 4 equal installments on January 1, 2008, January
                1,
                2009, January 1, 2010 and January 1, 2011.
</font></div>
            </td>
          </tr>

      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">

          <tr valign="top" style="line-height: 1.25;">
            <td align="right" style="width: 54pt;"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Symbol, serif">-&#160;&#160;</font></td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">A
                400,000 share award that is available if the trading price of the
                Company&#8217;s stock is at least $35 per share for 10 trading days within any
                period of 30 consecutive trading days on or before March 12, 2009.
                This
                award would also vest in 4 equal installments on January 1, 2008,
                January
                1, 2009, January 1, 2010 and January 1,
                2011.</font></div>
            </td>
          </tr>

      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><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"><strong><em>Stock
      Purchase Warrants Issued to Non-Employees</em></strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      Company accounts for equity securities issued to non-employees in accordance
      with the provisions of SFAS 123R and Emerging Issues Task Force 96-18. On
      November 30, 2004 the Company completed a private placement of 400,000 units,
      each Unit consisting of five (5) shares of the Company&#8217;s common stock and one
      (1) common stock purchase warrant. Each of the 400,000 warrants entitle the
      holder to purchase one (1) share of common stock at an exercise price of $15.00
      per share. An additional 5,440 warrants were issued to an individual who
      assisted the company in identifying participants in the November 30, 2004
      private placement and elected to receive a commission for the services in stock
      rather than cash. Each Warrant has a term of three (3) years and was callable
      at
      the Company&#8217;s option. </font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">During
      September 2006, certain warrant holders exercised their rights to purchase
      70,000 shares, and the Company received $1,050,000 from the sale of that common
      stock. In 2007, the Company exercised a right to terminate the remaining
      warrants on March 2, 2007, subject to a 30-day notice period. In response,
      the
      remaining warrant holders exercised their rights to purchase 335,440 shares
      of
      the Company&#8217;s common stock during the notice period, and the Company received
      $5.0 million from the sale of these shares. Following this exercise, no Warrants
      remain outstanding.</font></div>
    <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
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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: 8pt; FONT-FAMILY: "><strong>13</strong></font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
        </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="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><u>NOTE
      5 - INCOME TAXES</u></strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">As
      of
      June 30, 2007, the Company had net operating loss (NOL) carryforwards of
      approximately $74.4 million for federal income tax purposes and $25.0 million
      for California state income tax purposes. Such carryforwards expire in varying
      amounts through the year 2026. These amounts reflect the effective reduction
      of
      the NOL carryforwards as a result of ownership change annual limitation
      amounts.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
      addition, on August 26, 2005, a Settlement Agreement between Cadiz, on one
      hand,
      and Sun World and three of Sun World&#8217;s subsidiaries, on the other hand, was
      approved by the U.S. Bankruptcy Court, concurrently with the Court&#8217;s
      confirmation of the amended Plan. The Settlement Agreement provides that
      following the September 6, 2005 effective date of Sun World&#8217;s plan of
      reorganization, Cadiz will retain the right to utilize the Sun World net
      operating loss carryovers (NOLs). Sun World Federal NOLs are estimated to be
      approximately $57.8 million. If, in any year from calendar year 2005 through
      calendar year 2011, the utilization of such NOLs results in a reduction of
      Cadiz&#8217; tax liability for such year, then Cadiz will pay to the Sun World
      bankruptcy estate 25% of the amount of such reduction, and shall retain the
      remaining 75% for its own benefit. There is no requirement that Cadiz utilize
      these NOLs during this reimbursement period, or provide any reimbursement to
      the
      Sun World bankruptcy estate for any NOLs used by Cadiz after this reimbursement
      period expires. The Company has not recognized any tax benefits to these
      NOLs.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Section
      382 of the Internal Revenue Code imposes an annual limitation on the utilization
      of net operating loss carryforwards based on a statutory rate of return (usually
      the &#8220;applicable federal funds rate&#8221;, as defined in the Internal Revenue Code)
      and the value of the corporation at the time of a &#8220;change of ownership&#8221; as
      defined by Section 382. Due to past equity issuances and equity issuances in
      2005, and due to the Chapter 11 filing by Sun World, the Company&#8217;s ability to
      utilize net operating loss carryforwards is limited to approximately $6.6
      million annually, potentially adjusted by built-in gain items. </font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      Company is required to include certain financial statement disclosures with
      the
      interim period report for the quarter in which FSP FIN 48 is adopted. These
      disclosures reflect specific Company policies and amounts related to its
      accounting for uncertain tax positions.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">As
      of the
      January 1, 2007, adoption of FIN 48, the Company possessed unrecognized tax
      benefits totaling approximately $3.3 million. None of these, if recognized,
      would affect the Company's effective tax rate because the Company has recorded
      a
      full valuation allowance against these assets. Additionally, as of that date
      the
      company had accrued a total of $200,000 for state taxes, interest and penalties
      related to income tax positions in prior returns. In connection with the
      adoption of FIN 48, the Company elected to classify income tax penalties and
      interest as general and administrative expenses. For the three months ended
      June
      30, 2007, general and administrative expenses included approximately $40,000
      of
      income tax penalties and interest.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      Company does not expect that the unrecognized tax benefits will significantly
      increase or decrease in the next 12 months. </font></div>
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        </div>
      </div>
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        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: "><strong>14</strong></font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
        </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: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      Company's tax years 2003 through 2006 remain subject to examination by the
      Internal Revenue Service, and tax years 2002 through 2006 remain subject to
      examination by California tax jurisdictions. In addition, the Company's loss
      carryforward amounts are generally subject to examination and adjustment for
      a
      period of three years for federal tax purposes and four years for California
      purposes, beginning when such carryovers are utilized to reduce taxes in a
      future tax year.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Because
      it is more likely than not that the Company will not realize its net deferred
      tax assets, it has recorded a full valuation allowance against these assets.
      Accordingly, no deferred tax asset has been recorded in the accompanying balance
      sheet.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><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"><strong><u>NOTE
      6 - NET LOSS PER COMMON SHARE</u></strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Basic
      earnings per share (EPS) is computed by dividing the net loss, after deduction
      for preferred dividends either accrued or imputed, if any, by the
      weighted-average common shares outstanding. Options, deferred stock units,
      warrants, convertible debt, and preferred stock that are convertible into shares
      of the Company&#8217;s common stock were not considered in the computation of diluted
      EPS because their inclusion would have been antidilutive. Had these instruments
      been included, the fully diluted weighted average shares outstanding would
      have
      increased by approximately 2,125,000 and 927,000 shares for the three months
      ended June 30, 2007 and 2006, respectively. For the six months ended June 30,
      2007 and 2006, weighted averaged shares outstanding would have increased by
      approximately 2,115,000 and 917,000 shares, respectively.</font></div>
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        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: "><strong>15</strong></font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
        </div>
      </div>
      <div id="HDR">
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        </div>
      </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"><strong>ITEM
      2.</strong></font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 27pt">&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Management&#8217;s
      Discussion and Analysis of Financial Condition and Results of
      Operations</strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><em>In
      connection with the "safe harbor" provisions of the Private Securities
      Litigation Reform Act of 1995, the following discussion contains trend analysis
      and other forward-looking statements. Forward-looking statements can be
      identified by the use of words such as "intends", "anticipates", "believes",
      "estimates", "projects", "forecasts", "expects", "plans" and "proposes".
      Although we believe that the expectations reflected in these forward-looking
      statements are based on reasonable assumptions, there are a number of risks
      and
      uncertainties that could cause actual results to differ materially from these
      forward-looking statements. These include, among others, our ability to maximize
      value from our Cadiz, California land and water resources; and our ability
      to
      obtain new financings as needed to meet our ongoing working capital needs.
      See
      additional discussion under the heading "Certain Trends and Uncertainties"
      in
      Item 7 of our Annual Report on Form 10-K for the year ended December 31,
      2006.</em></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><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"><strong><em>Overview</em></strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      Company&#8217;s primary assets are 45,000 acres of land in three areas of eastern San
      Bernardino County, California. Virtually all of this land is underlain by
      high-quality groundwater resources with demonstrated potential for recreational,
      residential, and agricultural development. The properties are also located
      in
      proximity to the Colorado River and the Colorado River Aqueduct, the major
      source of imported water for southern California. The aquifer systems underlying
      the properties contain large amounts of water and are suitable for water storage
      and supply programs.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      value
      of these assets derives from a combination of projected population increases
      and
      limited water supplies throughout southern California. In addition, most of
      the
      major population centers in southern California are not located where
      significant precipitation occurs, requiring the importation of water from other
      parts of the state. The Company therefore believes that a competitive advantage
      exists for companies that can provide high quality, reliable, and affordable
      water to major population centers.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
      1993
      the Company secured permits for up to 9,600 acres of agricultural development
      in
      the Cadiz Valley and the withdrawal of more than 1 million acre-feet of ground
      water from the aquifer system underlying the property. In 1997, the Company
      entered into the first of a series of agreements with the Metropolitan Water
      District of Southern California (&#8220;Metropolitan&#8221;) to jointly design, permit and
      build an aquifer storage and supply program on the Company&#8217;s land in the Cadiz
      and Fenner Valleys (the &#8220;Cadiz Project&#8221; or the &#8220;Project&#8221;). Under the Cadiz
      Project, surplus water from the Colorado River would be stored in the aquifer
      system underlying our land during wet years. When needed, the stored water
      and
      temporary withdrawals of indigenous groundwater, could be distributed through
      the Colorado River Aqueduct to Metropolitan's member agencies throughout six
      southern California counties.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Between
      1997 and 2002, Metropolitan and the Company received substantially all of the
      various state and federal approvals required for permits to construct and
      operate the project and received a federal </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><em>Record
      of Decision (&#8220;ROD&#8221;)</em></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><em>&#160;</em></strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">from
      the
      U.S. Department of the Interior, which endorsed the Cadiz Project and offered
      a
      right of way grant for the construction of project facilities. The federal
      government also approved a Final Environmental Impact Statement (&#8220;FEIS&#8221;) in
      compliance with the National Environmental Policy Act (&#8220;NEPA&#8221;). </font></div>
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        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: "><strong>16</strong></font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
        </div>
      </div>
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        </div>
      </div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Despite
      the significant progress made in the federal environmental review process,
      in
      October 2002 Metropolitan&#8217;s Board voted not to accept the right of way grant
      offered by the U.S. Department of the Interior and refused to consider whether
      or not to certify the Final Environmental Impact Report (&#8220;FEIR&#8221;), which was a
      necessary action to authorize implementation of the Cadiz Project in accordance
      with the California Environmental Quality Act (&#8220;CEQA&#8221;). </font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">When
      Metropolitan&#8217;s Board declined to proceed with the Cadiz Project, the FEIR was
      awaiting certification at a hearing scheduled for late October 2002. It is
      the
      Company&#8217;s position that actions by Metropolitan breached various contractual and
      fiduciary obligations to the Company, and interfered with the economic advantage
      it would have obtained from the Cadiz Project. In April 2003 the Company filed
      a
      claim against Metropolitan seeking compensatory damages. When settlement
      negotiations failed to produce a resolution, the Company filed a lawsuit against
      Metropolitan in Los Angeles Superior Court on November 17, 2005. The claims
      for
</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">breach
      of
      fiduciary duty, breach of express contract, promissory estoppel, breach of
      implied contract and specific performance have all been allowed by the Court
      in
      its ruling on Metropolitan&#8217;s motion for demurrer. The Court is scheduled to hear
      motions for summary judgment brought by the Company and Metropolitan on August
      30, 2007. The case is currently scheduled for trial in late 2007.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Meanwhile,
      the need for water storage and supply programs has not abated. Moreover, the
      advantages of underground water storage facilities are increasingly evident.
      These include minimal surface environmental impacts, lower capital investment,
      protection from airborne contaminants and minimal evaporative water loss.
      Therefore the Company continues to pursue the completion of the environmental
      review process for the Cadiz Project.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">To
      address concerns expressed by certain elected officials and environmental
      groups, certain elements of the Project have been restructured. These
      operational changes concentrate on public concerns regarding the potential
      transfer and sale of indigenous groundwater and the potential replenishment
      of
      temporary withdrawals of indigenous groundwater. No changes are proposed to
      any
      of the physical facilities required to implement and operate the Cadiz
      Project.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">To
      that
      end, the County of San Bernardino has agreed to serve as the CEQA lead agency
      for the completion of the environmental review of the Cadiz Project and issue
      any permits required under California law once the review is completed. The
      Company is also working with the U.S. Department of the Interior to have the
      permits that were approved during the federal environmental review process,
      including the right of way granted in the ROD, issued directly to the Company
      for the benefit of any participating public agency.</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Additionally,
      the Company is in discussions with several other public agencies regarding
      their
      interest in participating in the Cadiz Project. These agencies have access
      to
      sources of water that can be stored in the Cadiz Project.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
      addition to agriculture and water development, the rapid growth of nearby desert
      communities in southern California, Nevada and Arizona indicates that the
      Company&#8217;s land holdings may be suitable for other types of development. To this
      end, the Company has conducted a detailed analysis of the Company&#8217;s land assets
      to assess the opportunities for these properties. Based on this analysis, the
      Company believes that its properties have significant long-term potential for
      residential and commercial development. The Company is continuing to explore
      alternative land uses to maximize the value of its properties.</font></div>
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        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: "><strong>17</strong></font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
        </div>
      </div>
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        </div>
      </div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
      2006,
      the Company refinanced its long term debt with a new $36.4 million zero coupon
      senior secured convertible term loan that matures on June 29, 2011. The Company
      also received $1.1 million in 2006 when certain holders of warrants issued
      in
      2004 exercised their right to purchase 70,000 common shares at $15.00 per share.
      In 2007, the Company exercised its right to terminate the remaining warrants
      on
      March 2, 2007, subject to a 30 day notice period. In response, the remaining
      warrant holders exercised their right to purchase 335,440 shares of the
      Company&#8217;s common stock during the notice period, and the Company received an
      additional $5.0 million from the sale of these shares. Following this exercise,
      no Warrants remain outstanding.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We
      issued
      100,000 shares of Series F convertible preferred stock to ING as part of our
      agreements in December 2003, of which 1,000 shares remained outstanding on
      December 31, 2006. In June 2007, ING elected to convert the preferred shares
      into 17,289 shares of common stock. No Series F Preferred Shares were
      outstanding on June 30, 2007.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      Company remains committed to its land and water assets and continues to explore
      all opportunities for development of these assets. The Company cannot predict
      with certainty which of these various opportunities will ultimately be
      utilized.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><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"><strong><em>Results
      of Operations</em></strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><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"><strong><em><u>Three
      Months Ended June 30, 2007 Compared to Three Months Ended June 30,
      2006</u></em></strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We
      have
      not received significant revenues from our water resource activity to date.
      As a
      result, we have historically incurred a net loss from operations. We had
      revenues of $5 thousand for the three months ended June 30, 2007 and $157
      thousand for the three months ended June 30, 2006. We incurred a net loss of
      $2.2 million in the three months ended June 30, 2007 compared with a $3.2
      million net loss during the three months ended June 30, 2006. The lower loss
      in
      the 2007 period primarily related to lower non-cash stock compensation costs
      related to stock and option awards made under the Company&#8217;s stock-based
      compensation plans.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Our
      primary expenses are our ongoing costs to develop our water and real estate
      assets and to secure the remaining entitlements needed to continue developing
      the Cadiz Program. These costs consist primarily of project management, legal,
      consulting, engineering and administrative expenses, which are characterized
      as
      general and administrative expenses for financial statement reporting purposes.
      We also have expenses related to the limited farming activities that we conduct
      at the Cadiz Ranch. Other costs include interest expense and compensation costs
      resulting from the grant of stock and options under the Cadiz 2003 Management
      Equity Incentive Plans and the Outside Director Compensation Plan.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><em><u>Revenues</u></em></strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">
      Cadiz
      had revenues of $5 thousand for the three months ended June 30, 2007 and $157
      thousand for the three months ended June 30, 2006. Lower revenues resulted
      primarily from the timing of the sale of citrus crops, as the smaller 2006
      lemon
      harvest started later in the year and was substantially complete
      by&#160;year-end.&#160; All the related revenues were recognized during first
      quarter of 2007.</font></div>
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        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: "><strong>18</strong></font></div>
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        </div>
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        </div>
      </div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><em><u>Cost
      of Sales</u></em></strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">
      Cost of
      Sales totaled $130 thousand during the three months ended June 30, 2006 and
      reflected the production, harvesting and marketing costs associated with citrus
      crop sales during the period. There were no citrus crop revenues during the
      three months ended June 30, 2007, so there was no related cost of
      sales.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><em><u>General
      and Administrative Expenses</u></em></strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><em>&#160;</em></strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">General
      and administrative expenses during the three months ended June 30, 2007 totaled
      $1.4 million compared to $1.8 million for the three months ended June 30, 2006.
      Non-cash compensation costs for stock and option awards are included in General
      and Administrative Expenses. </font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Compensation
      costs from stock and option awards for the three months ended June 30, 2007
      were
      $37 thousand, compared with $529 thousand for the three months ended June 30,
      2006. The expenses primarily relate to stock and options issued under the Cadiz
      2003 Management Equity Incentive Plan and the Outside Director Compensation
      Plan
      described in Note 4 of Notes to the Consolidated Financial Statements. The
      declining expense reflects a lower balance of unvested stock and option grants
      in June 30, 2007. There were no stock or option grants under these plans during
      the three months ended June 30, 2007. Shares and options issued under the Plans
      vest over varying periods from the date of issue to December 2008. We expect
      to
      incur additional non-cash expenses in connection with grants under the 2007
      Management Equity Incentive Plan, which became effective in July 2007. See
      Note
      4 of the Notes to the Consolidated Financial Statements - Stock Based
      Compensation Plans and Warrants.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Other
      General and Administrative Expenses, exclusive of stock based compensation
      costs, totaled $1.3 million in the three months ended June 30, 2007 and $1.2
      million in the three months ended June 30, 2006.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><em><u>Depreciation
      and Amortization</u></em></strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><em>&#160;</em></strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Depreciation
      and amortization expense for the three months ended June 30, 2007 and 2006
      totaled $39 thousand in each period, respectively.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><em><u>Interest
      Expense, net</u></em></strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>&#160;</strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">
      Net
      interest expense totaled $765 thousand during the three months ended June 30,
      2007, compared to $496 thousand during the same period in 2006. The following
      table summarizes the components of net interest expense for the two periods
      (in
      thousands):</font></div>
    <div>&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" width="100%">

          <tr>
            <td align="left" valign="top" width="56%">&#160;</td>
            <td align="left" colspan="5" valign="top" width="23%">
              <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"><strong>Three
                Months Ended</strong></font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="56%">&#160;</td>
            <td align="left" colspan="5" valign="top" width="23%">
              <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><u>June
                30,</u></strong></font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 293.45pt">&#160;</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 27pt">&#160;</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 27pt">&#160;</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="56%">&#160;</td>
            <td align="left" colspan="2" valign="top" width="11%">
              <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"><strong><u>2007</u></strong></font></div>
            </td>
            <td align="left" valign="top" width="2%">&#160;</td>
            <td align="left" colspan="2" valign="top" width="10%">
              <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"><strong><u>2006</u></strong></font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="56%">&#160;</td>
            <td align="left" colspan="2" valign="top" width="11%">&#160;</td>
            <td align="left" valign="top" width="2%">&#160;</td>
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              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font id="TAB1" style="MARGIN-LEFT: 18pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Amortization
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              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">-</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"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font id="TAB1" style="MARGIN-LEFT: 18pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Interest
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            <td align="left" valign="top" width="9%" style="border-bottom: black thin solid;">
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            <td align="right" valign="top" width="2%" style="border-bottom: black thin solid;">&#160;</td>
            <td align="left" valign="top" width="8%" style="border-bottom: black thin solid;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(39)</font></div>
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            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="9%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="8%">&#160;</td>
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            <td align="left" valign="top" width="56%">&#160;</td>
            <td align="right" valign="top" width="2%" style="border-bottom: black double;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$</font></div>
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            </td>
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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 id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      increase in net interest expense is primarily due to the amortization of the
      debt discount related to certain derivatives embedded to the new senior secured
      convertible term loan. 2007 interest income increased to $178 thousand from
      $39
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        </div>
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      <div id="PN" style="PAGE-BREAK-AFTER: always">
        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: "><strong>19</strong></font></div>
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      <div id="HDR">
        <div id="GLHDR" style="WIDTH: 100%" align="right">
        </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">due
      to
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      Consolidated Financial Statements: Note 3 - Long-term Debt.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><em><u>Income
      Taxes</u></em></strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">
      Income
      tax expense for the three months ended June 30, 2007 was $3 thousand. There
      was
      no income tax expense in the prior year period. See Note 5 of the Notes to
      the
      Consolidated Financial Statements - Income Taxes. </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"><strong><em><u>Six
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      2006</u></em></strong></font></div>
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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We
      had
      revenues of $357 thousand for the six months ended June 30, 2007 and $409
      thousand for the six months ended June 30, 2006. We incurred a net loss of
      $4.7
      million in the six months ended June 30, 2007, compared with a $5.4 million
      net
      loss during the six months ended June 30, 2006. The lower loss in the 2007
      period primarily related to lower non-cash expenses related to stock and option
      awards.</font></div>
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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><em><u>Revenues</u></em></strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">
      Cadiz
      had revenues of $357 thousand for the six months ended June 30, 2007 and $409
      thousand for the six months ended June 30, 2006. Lower revenues resulted
      primarily from the smaller lemon harvest in the fourth quarter of 2006. 2006
      crop yields were lower than the prior year due to unfavorable weather
      conditions.</font></div>
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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><em><u>Cost
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      Cost of
      Sales totaled $348 thousand during the six months ended June 30, 2007 and $341
      thousand during the six months ended June 30, 2006. The higher cost of sales
      in
      2007 reflects higher production, harvesting and marketing costs associated
      with
      citrus crop sales during the period.</font></div>
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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><em><u>General
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      and administrative expenses during the six months ended June 30, 2007 totaled
      $3.1 million compared to $3.9 million for the six months ended June 30, 2006.
      Non-cash compensation costs for stock and option awards are included in General
      and Administrative Expenses. </font></div>
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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Compensation
      costs from stock and option awards for the six months ended June 30, 2007 were
      $102 thousand, compared with $1.1 million for the six months ended June 30,
      2006. The expenses primarily relate to stock and options issued under the 2003
      Management Equity Incentive Plan and the Outside Director Compensation Plan
      described in Note 4 of Notes to the Consolidated Financial Statements. The
      declining expense reflects a lower balance of unvested stock and option grants
      in June 30, 2007. There were no stock or option grants under these plans during
      the six months ended June 30, 2007. Shares and options issued under the Plans
      vest over varying periods from the date of issue to December 2008. We expect
      to
      incur additional non-cash expenses in connection with grants under the 2007
      Management Equity Incentive Plan when that plan became effective in July 2007.
      See Note 4 of the Notes to the Consolidated Financial Statements - Stock Based
      Compensation Plans and Warrants.</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"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Other
      General and Administrative Expenses, exclusive of stock based compensation
      costs, totaled $3.0 million in the six months ended June 30, 2007, compared
      with
      $2.8 million for the six months ended June 30, 2006. The increase in expenses
      is
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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><em><u>Depreciation
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      and amortization expense for the six months ended June 30, 2007 and 2006 totaled
      $76 thousand and $79 thousand, respectively.</font></div>
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        <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: 8pt; FONT-FAMILY: "><strong>20</strong></font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
        </div>
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      Net
      interest expense totaled $1.5 million during the six months ended June 30,
      2007,
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      summarizes the components of net interest expense for the two periods (in
      thousands):</font></div>
    <div>&#160;</div>
    <div>
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          <tr>
            <td align="left" valign="top" width="56%">&#160;</td>
            <td align="left" colspan="5" valign="top" width="23%">
              <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"><strong>Six
                Months Ended</strong></font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="56%">&#160;</td>
            <td align="left" colspan="5" valign="top" width="23%">
              <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><u>June
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            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="56%">&#160;</td>
            <td align="left" colspan="2" valign="top" width="11%">
              <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"><strong><u>2007</u></strong></font></div>
            </td>
            <td align="left" valign="top" width="2%">&#160;</td>
            <td align="left" colspan="2" valign="top" width="10%">
              <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"><strong><u>2006</u></strong></font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="56%">&#160;</td>
            <td align="left" colspan="2" valign="top" width="11%">&#160;</td>
            <td align="left" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="8%">&#160;</td>
          </tr>
          <tr>
            <td align="left" valign="top" width="56%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font id="TAB1" style="MARGIN-LEFT: 18pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Interest
                on outstanding debt</font></div>
            </td>
            <td align="right" valign="top" width="2%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$</font></div>
            </td>
            <td align="left" valign="top" 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-SIZE: 10pt; FONT-FAMILY: Times New Roman">938</font></div>
            </td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%">
              <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$</font></div>
            </td>
            <td align="left" valign="top" width="8%">
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            <td align="left" valign="top" width="56%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font id="TAB1" style="MARGIN-LEFT: 18pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Amortization
                of financing costs</font></div>
            </td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" 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-SIZE: 10pt; FONT-FAMILY: Times New Roman">29</font></div>
            </td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="8%">
              <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">14</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="56%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font id="TAB1" style="MARGIN-LEFT: 18pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Amortization
                of debt discount</font></div>
            </td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" 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-SIZE: 10pt; FONT-FAMILY: Times New Roman">866</font></div>
            </td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="8%">
              <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></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="56%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font id="TAB1" style="MARGIN-LEFT: 18pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Interest
                income</font></div>
            </td>
            <td align="right" valign="top" width="2%" style="border-bottom: black thin solid;">&#160;</td>
            <td align="left" valign="top" width="9%" style="border-bottom: black thin solid;">
              <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">(305)</font></div>
            </td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%" style="border-bottom: black thin solid;">&#160;</td>
            <td align="left" valign="top" width="8%" style="border-bottom: black thin solid;">
              <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">(83)</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="top" width="56%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="9%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="left" valign="top" width="8%">&#160;</td>
          </tr>
          <tr>
            <td align="left" valign="top" width="56%">&#160;</td>
            <td align="right" valign="top" width="2%" style="border-bottom: black double;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$</font></div>
            </td>
            <td align="left" valign="top" width="9%" style="border-bottom: black double;">
              <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">1,528</font></div>
            </td>
            <td align="right" valign="top" width="2%">&#160;</td>
            <td align="right" valign="top" width="2%" style="border-bottom: black double;">
              <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$</font></div>
            </td>
            <td align="left" valign="top" width="8%" style="border-bottom: black double;">
              <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">977</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 style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      increase in net interest expense is primarily due the amortization of the debt
      discount related to certain derivatives embedded to the new senior secured
      convertible term loan. 2007 interest income increased to $305 thousand from
      $83
      thousand in the prior year, due to higher cash balances and higher short-term
      interest rates. See Notes to the Consolidated Financial Statements: Note 3
      -
      Long-term Debt.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><em><u>Other
      Income</u></em></strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">
      During
      the six month period ended June 30, 2006, one of our stockholders determined
      that it had, at a time when it was the beneficial holder of more than 10% of
      our
      outstanding equity securities, inadvertently engaged in trades which resulted
      in
      automatic short swing profit liability to the Company pursuant to Section 16(b)
      of the Securities Exchange Act of 1934. After becoming aware of the situation,
      the stockholder promptly made payments totaling $350,000 to the Company to
      settle the entire short swing profit liability owed as a consequence of these
      trades.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><em><u>Income
      Taxes</u></em></strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">
      Income
      tax expense for the six months ended June 30, 2007 was $8 thousand. There was
      no
      income tax expense in the prior year period. See Note 5 of the Notes to the
      Consolidated Financial Statements - Income Taxes. </font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><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"><strong>LIQUIDITY
      AND CAPITAL RESOURCES </strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><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"><strong><em><u>Current
      Financing Arrangements</u></em></strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">As
      we
      have not received significant revenues from our water resource and real estate
      activity to date, we have been required to obtain financing to bridge the gap
      between the time water resource and real estate development expenses are
      incurred and the time that revenue will commence. Historically, we have
addressed these needs primarily through secured debt financing arrangements,
      private equity placements and the exercise of outstanding stock options and
      warrants.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Subsequent
      to the vote of Metropolitan&#8217;s Board in October 2002 to not proceed with the
      Cadiz Project and Sun World&#8217;s January 2003 bankruptcy filing, we have worked
      with our primary secured lenders to structure our debt in a way which allows
      us
      to continue our </font></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: 8pt; FONT-FAMILY: "><strong>21</strong></font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
        </div>
      </div>
      <div id="HDR">
        <div id="GLHDR" style="WIDTH: 100%" align="right">
        </div><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">development
        of the Cadiz Project and minimize the dilution of the ownership interests
        of
        common stockholders. We entered into a series of agreements with ING Capital
        LLC
        and then refinanced the ING loan with a new $36.4 million five year zero
        coupon
        senior secured convertible term loan with Peloton Partners LLP (through an
        affiliate) and another lender (the &#8220;Peloton Loan&#8221;) in June 2006. The Peloton
        loan provided for:</font></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">

          <tr valign="top" style="line-height: 1.25;">
            <td align="right" style="width: 54pt;"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Symbol, serif">&#183;&#160;&#160;</font></td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">the
                repayment in full of our senior secured term loan with ING;
                </font></div>
            </td>
          </tr>

      </table>
    </div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">

          <tr valign="top" style="line-height: 1.25;">
            <td align="right" style="width: 54pt;"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Symbol, serif">&#183;&#160;&#160;</font></td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">a
                final maturity date of June 29,
                2011;</font></div>
            </td>
          </tr>

      </table>
    </div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">

          <tr valign="top" style="line-height: 1.25;">
            <td align="right" style="width: 54pt;"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Symbol, serif">&#183;&#160;&#160;</font></td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">a
                zero coupon structure, which requires no cash interest payments prior
                to
                the final maturity date; and</font></div>
            </td>
          </tr>

      </table>
    </div>
    <div>
      <table cellpadding="0" cellspacing="0" id="list" width="100%">

          <tr valign="top" style="line-height: 1.25;">
            <td align="right" style="width: 54pt;"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Symbol, serif">&#183;&#160;&#160;</font></td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">a
                5% interest rate for the first three (3) years, with a 6% interest
                rate
                thereafter.</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"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">At
      each
      lender&#8217;s option, principal plus accrued interest on each of the two loan
      tranches is convertible into the Company&#8217;s $0.01 par value common stock at a
      fixed conversion price per share. The $10 million Tranche A conversion price
      is
      $18.15 per share, and the $26.4 million Tranche B conversion price is $23.10
      per
      share. The conversion prices are subject to downward adjustment in the event
      of
      a change in control.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On
      or
      after June 29, 2007, principal and interest accrued on each of the two loan
      tranches can be prepaid on 30 days notice either if the price of the Company&#8217;s
      stock on the NASDAQ Global Market exceeds the tranche&#8217;s conversion price by 40%
      for 20 consecutive trading days in a 30 trading day period or if the Company
      completes the Cadiz Water Program entitlement process, secures a right-of-way
      for the project pipeline and arranges sufficient financing to repay the loan
      and
      build the Cadiz Project. The $10 million Tranche A prepayment option would
      become available at a share price above $25.41 per share and the Tranche B
      prepayment option would become available at a share price above $32.34 per
      share.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      debt
      covenants associated with the loan were negotiated by the parties with a view
      towards our operating and financial condition as it existed at the time the
      agreements were executed. At June 30, 2007, the Company was in compliance with
      its debt covenants.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
      addition to allowing us to repay our former credit facility with ING, the
      Peloton Loan provided us with $9.3 million of additional working capital and
      deferred all interest payments until the June 29, 2011 final maturity date.
      Furthermore, the Peloton Loan, unlike the ING facility, permitted us to retain
      the proceeds received from the exercise of certain warrants issued by us in
      2004.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">A
      $24
      million private equity placement was completed by the Company in November 30,
      2004, and included the issuance of warrants to purchase 405,440 shares of our
      common stock at an exercise price of $15.00 per share. During September 2006,
      holders of 70,000 of the warrants exercised their warrants, resulting in the
      issuance by us of 70,000 shares of common stock with net proceeds of $1,050,000.
      In February 2007, we exercised our right to terminate the remaining warrants
      upon 30 days notice, and holders of all the remaining 335,440 warrants exercised
      their warrants. As a result, we issued 335,440 shares of our common stock and
      received net proceeds of $5,031,600 during February 2007. Following these
      exercises, no Warrants remain outstanding.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">During
      February 2007, an employee elected to exercise options to purchase 10,000 shares
      of our common stock for $13.95 per share, and we received proceeds of
      $139,500.</font></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: 8pt; FONT-FAMILY: "><strong>22</strong></font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
        </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: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">As
      we
      continue to actively pursue our business strategy, additional financing in
      connection with our water programs will be required. See &#8220;Outlook&#8221;, below. The
      covenants in the credit facility do not prohibit our use of additional equity
      financing and allow us to retain 100% of the proceeds of any equity financing.
      We do not expect the loan covenants to materially limit our ability to finance
      our water development activities.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We
      issued
      100,000 shares of Series F convertible preferred stock to ING as part of our
      agreements in December 2003, of which 1,000 shares remained outstanding on
      December 31, 2006. In June 2007, ING elected to convert the preferred shares
      into 17,289 shares of common stock. No Series F Preferred Shares were
      outstanding on June 30, 2007, and, as discussed further in Item 5 of Part II
      -
      Other Information, the Series F Preferred Stock was subsequently eliminated
      from
      the Company&#8217;s certificate of incorporation.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">At
      June
      30, 2007, we have no outstanding credit facilities other than the Peloton Loan
      described in our 10K for the year ended December 31, 2006.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><u>Cash
      Used for Operating Activities</u></strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.
      Cash
      used for operating activities was $2.6 million for the six months ended June
      30,
      2007, as compared to $2.3 million for the six months ended June 30, 2006. The
      increased cash usage is primarily due to higher general and administrative
      expenses, which are primarily due to higher payroll expenses.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><u>Cash
      Used for Investing activities</u></strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.
      During
      the six months ended June 30, 2007, net cash flow used for investing activities
      was $8.8 million, reflecting investments in marketable securities&#160;and the
      acquisition of equipment at the Cadiz Ranch. During the six months ended June
      30, 2006, net cash flow used for investing activities was $19 thousand,
      primarily for the acquisition of plant and equipment at the Cadiz
      Ranch.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><u>Cash
      Provided by (Used for) Financing Activities</u></strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.
      Cash
      provided by financing activities totaled $5.2 million for the six months ended
      June 30, 2007, compared with $9.3 million in the six months ended June 30,
      2006.
      The 2007 results reflect $5.2 million of net proceeds from the exercise of
      warrants to purchase 335,440 shares of our common stock for $15.00 per share
      and
      the exercise of options to purchase 10,000 shares of our common stock for $13.95
      per share by an employee. The 2006 results reflect the proceeds remaining from
      the $36.4 million zero coupon senior secured convertible term loan facility
      after repayment of the ING credit facility and debt issuance costs in June
      2006.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><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"><strong><em><u>Outlook</u></em></strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><em>Short
      Term Outlook.</em></strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">
      The
      proceeds of our $36.4 million senior secured convertible term loan and the
      $6.2
      million received upon the sale of common shares in 2007 and 2006 pursuant to
      the
      exercise of certain warrants issued in November 2004 and the exercise of
      employee stock options provide us with sufficient funds to meet our expected
      working capital needs for the next 12 months. The Company expects to continue
      its historical practice of structuring its financing arrangements to match
      the
      anticipated needs of its development activities.</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">
      See
      "Long Term Outlook", below. No assurances can be given, however, as to the
      availability or terms of any new financing.</font></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: 8pt; FONT-FAMILY: "><strong>23</strong></font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
        </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: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Long
      Term Outlook</strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><em>.
      </em></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
      the
      longer term, we will need to raise additional capital to finance working capital
      needs and any payments due under our senior secured convertible term loan at
      maturity. See &#8220;Current Financing Arrangements&#8221; above. Payments will be due under
      the term loan only to the extent that lenders elect not to exercise equity
      conversion rights prior to the loan&#8217;s final maturity date. Our future working
      capital needs will depend upon the specific measures we pursue in the
      entitlement and development of our water resources and real estate. We will
      evaluate the amount of cash needed, and the manner in which such cash will
      be
      raised, on an ongoing basis. We may meet any future cash requirements through
      a
      variety of means, including equity or debt placements, or through the sale
      or
      other disposition of assets. Equity placements would be undertaken only to
      the
      extent necessary, so as to minimize the dilutive effect of any such placements
      upon our existing stockholders.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><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"><strong><em><u>Recent
      Accounting Pronouncements</u></em></strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
      June
      2006, the FASB issued FSP FIN 48 which clarifies the accounting for uncertainty
      in income taxes recognized in an enterprise&#8217;s financial statements in accordance
      with FASB Statement No. 109, &#8220;Accounting for Income Taxes.&#8221; This Interpretation
      prescribes a recognition threshold and measurement attribute for the financial
      statement recognition and measurement of a tax position taken or expected to
      be
      taken on a tax return. This Interpretation also provides guidance on
      derecognition, classification, interest, penalties, accounting in interim
      periods, disclosure and transition. The evaluation of a tax position in
      accordance with this Interpretation is a two-step process. The first step is
      to
      determine if it is more likely than not that a tax position will be sustained
      upon examination and should therefore be recognized. The second step is to
      measure a tax position that meets the more likely than not recognition threshold
      to determine the amount of benefit to recognize in the financial statements.
      Effective, January 1, 2007, the Company&#8217;s financial statements reflect FSP FIN
      48. </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      adoption of </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">FSP
      FIN
      48</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">
      did not
      have a material impact on the Company&#8217;s financial statements.</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: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
      September 2006, the FASB released Statement of Financial Accounting Standards
      No. 157 (&#8220;SFAS No. 157&#8221;), &#8220;Fair Value Measurements". This statement defines fair
      value, establishes a framework for measuring fair value and expands disclosures
      about fair value measurements. SFAS No. 157 clarifies the exchange price notion
      in the fair value definition to mean the price that would be received to sell
      the asset or paid to transfer the liability (an exit price), not the price
      that
      would be paid to acquire the asset or received to assume the liability (an
      entry
      price). This statement also clarifies that market participant assumptions should
      include assumptions about risk, should include assumptions about the effect
      of a
      restriction on the sale or use of an asset and should reflect its nonperformance
      risk (the risk that the obligation will not be fulfilled). Nonperformance risk
      should include the reporting entity&#8217;s credit risk. SFAS No. 157 is effective for
      financial statements issued for fiscal years beginning after November 15, 2007.
      The Company will adopt SFAS No. 157 on January 1, 2008, as required, and
      management is still evaluating the impact on the Company&#8217;s consolidated
      financial statements.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
      February 2007, the FASB released Statement of Financial Accounting Standards
      No.
      159 (&#8220;SFAS No. 159), &#8220;The Fair Value Option for Financial Assets and Liabilities
      Including an Amendment of FASB Statement No. 115&#8221;. SFAS No. 159 permits entities
      to choose to measure certain financial assets and liabilities at fair value
      and
      is effective for the first fiscal year beginning after November 15, 2007. The
      Company will adopt SFAS No. 159 on January 1,</font></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: 8pt; FONT-FAMILY: "><strong>24</strong></font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
        </div>
      </div>
      <div id="HDR">
        <div id="GLHDR" style="WIDTH: 100%" align="right">
        </div><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2008,
        as
        required, and management is still evaluating the impact on the Company&#8217;s
        consolidated financial statements.</font></div>
    </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"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><em><u>Certain
      Known Contractual Obligations</u></em></strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div>
      <table cellpadding="0" cellspacing="0" width="100%">

          <tr>
            <td valign="middle" width="22%">&#160;</td>
            <td colspan="14" valign="middle" width="59%">
              <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"><strong><u>Payments
                Due by Period</u></strong></font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="middle" width="22%">
              <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"><strong><u>Contractual
                Obligations</u></strong></font></div>
            </td>
            <td colspan="2" valign="middle" width="10%">
              <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"><strong><u>Total</u></strong></font></div>
            </td>
            <td valign="middle" width="2%">&#160;</td>
            <td colspan="2" valign="middle" width="11%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: -9pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: -5.4pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><u>1
                year or less</u></strong></font></div>
            </td>
            <td valign="middle" width="2%">&#160;</td>
            <td colspan="2" valign="middle" width="9%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: -9pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: -5.4pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><u>2-3
                years</u></strong></font></div>
            </td>
            <td valign="middle" width="2%">&#160;</td>
            <td colspan="2" valign="middle" width="10%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: -9pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: -5.4pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><u>4-5
                years</u></strong></font></div>
            </td>
            <td valign="middle" width="2%">&#160;</td>
            <td colspan="2" valign="middle" width="10%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: -9pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: -4.5pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><u>After
                5 years</u></strong></font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="middle" width="22%">&#160;</td>
            <td align="right" valign="middle" width="2%">&#160;</td>
            <td align="right" valign="middle" width="8%">&#160;</td>
            <td align="right" valign="middle" width="2%">&#160;</td>
            <td align="right" valign="middle" width="4%">&#160;</td>
            <td align="right" valign="middle" width="7%">&#160;</td>
            <td align="right" valign="middle" width="2%">&#160;</td>
            <td align="right" valign="middle" width="2%">&#160;</td>
            <td align="right" valign="middle" width="7%">&#160;</td>
            <td align="right" valign="middle" width="2%">&#160;</td>
            <td align="right" valign="middle" width="2%">&#160;</td>
            <td align="right" valign="middle" width="8%">&#160;</td>
            <td align="right" valign="middle" width="2%">&#160;</td>
            <td align="right" valign="middle" width="3%">&#160;</td>
            <td align="right" valign="middle" width="7%">&#160;</td>
          </tr>
          <tr>
            <td align="left" valign="middle" width="22%">
              <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">Long
                term debt obligations</font></div>
            </td>
            <td align="right" valign="middle" width="2%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$</font></div>
            </td>
            <td align="right" valign="middle" width="8%">
              <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: -9pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">38,281</font></div>
            </td>
            <td align="right" valign="middle" width="2%">&#160;</td>
            <td align="right" valign="middle" width="4%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$</font></div>
            </td>
            <td align="right" valign="middle" width="7%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">9</font></div>
            </td>
            <td align="right" valign="middle" width="2%">&#160;</td>
            <td align="right" valign="middle" width="2%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$</font></div>
            </td>
            <td align="right" valign="middle" width="7%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">18</font></div>
            </td>
            <td align="right" valign="middle" width="2%">&#160;</td>
            <td align="right" valign="middle" width="2%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$</font></div>
            </td>
            <td align="right" valign="middle" width="8%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">38,254</font></div>
            </td>
            <td align="right" valign="middle" width="2%">&#160;</td>
            <td align="right" valign="middle" width="3%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$</font></div>
            </td>
            <td align="right" valign="middle" width="7%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">-</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="middle" width="22%">
              <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">Interest
                Expense</font></div>
            </td>
            <td align="right" valign="middle" width="2%">&#160;</td>
            <td align="right" valign="middle" width="8%">
              <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: -9pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">9,493</font></div>
            </td>
            <td align="right" valign="middle" width="2%">&#160;</td>
            <td align="right" valign="middle" width="4%">&#160;</td>
            <td align="right" valign="middle" width="7%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">1</font></div>
            </td>
            <td align="right" valign="middle" width="2%">&#160;</td>
            <td align="right" valign="middle" width="2%">&#160;</td>
            <td align="right" valign="middle" width="7%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">1</font></div>
            </td>
            <td align="right" valign="middle" width="2%">&#160;</td>
            <td align="right" valign="middle" width="2%">&#160;</td>
            <td align="right" valign="middle" width="8%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">9,491</font></div>
            </td>
            <td align="right" valign="middle" width="2%">&#160;</td>
            <td align="right" valign="middle" width="3%">&#160;</td>
            <td align="right" valign="middle" width="7%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">-</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="middle" width="22%">
              <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">Operating
                leases</font></div>
            </td>
            <td align="right" valign="middle" width="2%" style="border-bottom: black thin solid;">&#160;</td>
            <td align="right" valign="middle" width="8%" style="border-bottom: black thin solid;">
              <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: -9pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">919</font></div>
            </td>
            <td align="right" valign="middle" width="2%">&#160;</td>
            <td align="right" valign="middle" width="4%" style="border-bottom: black thin solid;">&#160;</td>
            <td align="right" valign="middle" width="7%" style="border-bottom: black thin solid;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">164</font></div>
            </td>
            <td align="right" valign="middle" width="2%">&#160;</td>
            <td align="right" valign="middle" width="2%" style="border-bottom: black thin solid;">&#160;</td>
            <td align="right" valign="middle" width="7%" style="border-bottom: black thin solid;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">350</font></div>
            </td>
            <td align="right" valign="middle" width="2%">&#160;</td>
            <td align="right" valign="middle" width="2%" style="border-bottom: black thin solid;">&#160;</td>
            <td align="right" valign="middle" width="8%" style="border-bottom: black thin solid;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">359</font></div>
            </td>
            <td align="right" valign="middle" width="2%">&#160;</td>
            <td align="right" valign="middle" width="3%" style="border-bottom: black thin solid;">&#160;</td>
            <td align="right" valign="middle" width="7%" style="border-bottom: black thin solid;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">46</font></div>
            </td>
          </tr>
          <tr>
            <td align="left" valign="middle" width="22%">&#160;</td>
            <td align="right" valign="middle" width="2%" style="border-bottom: black double;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$</font></div>
            </td>
            <td align="right" valign="middle" width="8%" style="border-bottom: black double;">
              <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: -9pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">48,693</font></div>
            </td>
            <td align="right" valign="middle" width="2%">&#160;</td>
            <td align="right" valign="middle" width="4%" style="border-bottom: black double;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$</font></div>
            </td>
            <td align="right" valign="middle" width="7%" style="border-bottom: black double;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">174</font></div>
            </td>
            <td align="right" valign="middle" width="2%">&#160;</td>
            <td align="right" valign="middle" width="2%" style="border-bottom: black double;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$</font></div>
            </td>
            <td align="right" valign="middle" width="7%" style="border-bottom: black double;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">369</font></div>
            </td>
            <td align="right" valign="middle" width="2%">&#160;</td>
            <td align="right" valign="middle" width="2%" style="border-bottom: black double;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$</font></div>
            </td>
            <td align="right" valign="middle" width="8%" style="border-bottom: black double;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">48,104</font></div>
            </td>
            <td align="right" valign="middle" width="2%">&#160;</td>
            <td align="right" valign="middle" width="3%" style="border-bottom: black double;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">$</font></div>
            </td>
            <td align="right" valign="middle" width="7%" style="border-bottom: black double;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">46</font></div>
            </td>
          </tr>
          <tr>
            <td align="right" valign="middle" width="22%">&#160;</td>
            <td align="right" valign="middle" width="2%">&#160;</td>
            <td align="right" valign="middle" width="8%">&#160;</td>
            <td align="right" valign="middle" width="2%">&#160;</td>
            <td align="right" valign="middle" width="4%">&#160;</td>
            <td align="right" valign="middle" width="7%">&#160;</td>
            <td align="right" valign="middle" width="2%">&#160;</td>
            <td align="right" valign="middle" width="2%">&#160;</td>
            <td align="right" valign="middle" width="7%">&#160;</td>
            <td align="right" valign="middle" width="2%">&#160;</td>
            <td align="right" valign="middle" width="2%">&#160;</td>
            <td align="right" valign="middle" width="8%">&#160;</td>
            <td align="right" valign="middle" width="2%">&#160;</td>
            <td align="right" valign="middle" width="3%">&#160;</td>
            <td align="right" valign="middle" width="7%">&#160;</td>
          </tr>

      </table>
    </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: 8pt; FONT-FAMILY: "><strong>25</strong></font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
        </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="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>ITEM
      3.</strong></font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 27pt">&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Quantitative
      and Qualitative Disclosures about Market Risk</strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Information
      about market risks for the six months ended June 30, 2007 does not differ
      materially from that discussed under Item 7A of Cadiz&#8217; Annual Report on Form
      10-K for the year ended December 31, 2006.<br></font><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"><strong>ITEM
      4.</strong></font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 27pt">&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Controls
      and Procedures</strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><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"><strong>Disclosure
      Controls and Procedures</strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We
      have
      established disclosure controls and procedures to ensure that material
      information related to the Company, including its consolidated entities, is
      accumulated and communicated to senior management, including the Chairman and
      Chief Executive Officer (the &#8220;Principal Executive Officer&#8221;) and Chief Financial
      Officer (the &#8220;Principal Financial Officer&#8221;) and to our Board of Directors. Based
      on their evaluation as of June 30, 2007, our Principal Executive Officer and
      Principal Financial Officer have concluded that the Company's disclosure
      controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under
      the
      Securities Exchange Act of 1934) are effective to ensure that the information
      required to be disclosed by the Company in the reports that it files or submits
      under the Securities Exchange Act of 1934 is recorded, processed, summarized
      and
      reported within the time periods specified in Securities and Exchange Commission
      rules and forms, and such information is accumulated and communicated to
      management, including the principal executive and principal financial officers
      as appropriate, to allow timely decisions regarding required
      disclosures.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><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"><strong>Changes
      in Internal Controls Over Financial Reporting </strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
      connection with the evaluation required by paragraph (d) of Rule 13a-15 under
      the Exchange Act, there was no change identified in the Company's internal
      controls over financial reporting that occurred during the last fiscal quarter
      that has materially affected, or is reasonably likely to materially affect,
      the
      Company's internal controls over financial reporting.</font></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: 8pt; FONT-FAMILY: "><strong>26</strong></font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
        </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="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>PART
      II - OTHER INFORMATION</strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><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"><strong>ITEM
      1.</strong></font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 27pt">&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Legal
      Proceedings</strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">See
      &#8220;Legal Proceedings&#8221; included in the Company&#8217;s latest Form 10-K for a complete
      discussion.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br><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"><strong>ITEM
      1A.</strong></font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 27pt">&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Risk
      Factors</strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">There
      have been no material changes to the factors disclosed in Item 1A. Risk Factors
      in our Annual Report on Form 10-K for the year ended December 31,
      2006.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><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"><strong><br>ITEM
      2.</strong></font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 27pt">&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Unregistered
      Sales of Equity Securities and Use of Proceeds</strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 54pt; TEXT-INDENT: -54pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">As
      indicated above under Item 2 (Management's Discussion and Analysis of Financial
      Condition and Results of Operations), on June 15, 2007 ING converted its 1,000
      remaining shares of Series F Preferred Stock into 17,289 shares of our common
      stock. Following this conversion, no shares of our Series F Preferred Stock
      remained outstanding.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      issuance of the common stock upon conversion of the Series F Preferred Stock
      was
      not registered under the Securities Act of 1933, as amended (the "Securities
      Act"), but was exempt from the registration requirements of the Securities
      Act
      by virtue of Section 4(2) of the Securities Act as the transactions (including
      the issuance of the Series F Preferred Stock) did not involve public offerings,
      the number of investors was limited, the investors were provided with
      information about us, and we placed restrictions on the resale of the
      securities.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 54pt; TEXT-INDENT: -54pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>ITEM
      3.</strong></font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 27pt">&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Defaults
      Upon Senior Securities</strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 54pt; TEXT-INDENT: -54pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 54pt; TEXT-INDENT: -54pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Not
      applicable.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 54pt; TEXT-INDENT: -54pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 54pt; TEXT-INDENT: -54pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 54pt; TEXT-INDENT: -54pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>ITEM
      4.</strong></font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 27pt">&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Submission
      of Matter to a Vote of Security Holders</strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 54pt; TEXT-INDENT: -54pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      Company&#8217;s current report on Form 8-K dated June 15, 2007 and filed on June 29,
      2007 is incorporated by reference as part of this quarterly report on Form
      10-Q.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 72pt; TEXT-INDENT: -72pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>ITEM
      5.</strong></font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 27pt">&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Other
      Information</strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 54pt; TEXT-INDENT: -54pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On
      August
      3, 2007 we filed a Certificate of Elimination of Series F Preferred Stock with
      the State of Delaware. We made this filing inasmuch as, with the conversion
      by
      ING of all remaining outstanding Series F Preferred Stock as noted in Item
      2
      above, we have no shares of Series F Preferred Stock outstanding and no shares
      of Series F Preferred Stock will be issued in the future. The effect of this
      filing was to eliminate from our Certificate of Incorporation all matters set
      forth in the certificate of designation previously filed by us with respect
      to
      the Series F Preferred Stock.</font></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: 8pt; FONT-FAMILY: "><strong>27</strong></font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
        </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="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>ITEM
      6. </strong></font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 27pt">&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Exhibits
      </strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      following exhibits are filed or incorporated by reference as part of this
      Quarterly Report on Form 10-Q. </font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 99pt; TEXT-INDENT: -99pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 90pt; TEXT-INDENT: -45pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">3.1&#160;&#160;&#160;&#160;&#160;&#160;
      </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Certificate
      of Elimination of Series F Preferred Stock of Cadiz Inc. (as filed August 3,
      2007)</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 90pt; TEXT-INDENT: -45pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 90pt; TEXT-INDENT: -45pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">10.1&#160;&#160;&#160;&#160;
      </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2007
      Management Equity Incentive Plan <sup>(1)</sup></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 90pt; TEXT-INDENT: -45pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 90pt; TEXT-INDENT: -45pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">31.1&#160;&#160;&#160;&#160;
      </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Certification
      of Keith Brackpool, Chairman and Chief Executive Officer of Cadiz Inc. pursuant
      to Section 302 of the Sarbanes-Oxley Act of 2002</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 90pt; TEXT-INDENT: -45pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 90pt; TEXT-INDENT: -45pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">31.2&#160;&#160;&#160;&#160;
      </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Certification
      of O&#8217;Donnell Iselin II, Chief Financial Officer and Secretary of Cadiz Inc.
      pursuant to Section 302 of the Sarbanes-Oxley Act of 2002</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 90pt; TEXT-INDENT: -45pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 90pt; TEXT-INDENT: -45pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">32.1&#160;&#160;&#160;&#160;
      </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Certification
      of Keith Brackpool, Chairman and Chief Executive Officer of Cadiz Inc. pursuant
      to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the
      Sarbanes-Oxley Act of 2002</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 90pt; TEXT-INDENT: -45pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 90pt; TEXT-INDENT: -45pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">32.2&#160;&#160;&#160;&#160;
      </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Certification
      of O'Donnell Iselin II, Chief Financial Officer and Secretary of Cadiz Inc.
      pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the
      Sarbanes-Oxley Act of 2002</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div>
      <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%">

          <tr valign="top" style="line-height: 1.25;">
            <td style="width: 54pt;">&#160;</td>
            <td style="width: 18pt;">
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><sup>(1)</sup></font></div>
            </td>
            <td>
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Previously
                filed as appendix A to our definitive proxy dated April 27, 2007
                as filed
                April 27, 2007.</font></div>
            </td>
          </tr>

      </table>
    </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: 8pt; FONT-FAMILY: "><strong>28</strong></font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
        </div>
      </div>
      <div id="HDR">
        <div id="GLHDR" style="WIDTH: 100%" align="right">
        </div><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>SIGNATURE</strong></font><br></div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Pursuant
      to the requirements of the Securities Exchange Act of 1934, the Registrant
      has
      duly caused this report to be signed on its behalf by the undersigned, thereunto
      duly authorized.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><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"><strong>Cadiz
      Inc.</strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
    <div align="center">
      <table bgcolor="white" cellpadding="0" cellspacing="0" width="100%">

          <tr bgcolor="white">
            <td width="4%">
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;By:</font></div>
            </td>
            <td width="55%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>&#160;/s/
              Keith Brackpool</u></font></td>
            <td width="33%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>August
              6, 2007</u>&#160;</font></td>
          </tr>
          <tr bgcolor="white">
            <td width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
            <td width="55%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Keith
              Brackpool&#160;</font></td>
            <td width="33%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Date&#160;</font></td>
          </tr>
          <tr bgcolor="white">
            <td width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
            <td width="55%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Chairman
              of the Board&#160;and Chief&#160;Executive Officer (Principal
              Executive&#160;Officer)&#160;</font></td>
            <td width="33%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
          </tr>
          <tr bgcolor="white">
            <td width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
            <td width="55%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
            <td width="33%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
          </tr>
          <tr bgcolor="white">
            <td width="4%">
              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;By:&#160;</font></div>
            </td>
            <td width="55%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>/s/
              O'Donnell Iselin II</u>&#160;</font></td>
            <td width="33%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>August
              6, 2007</u>&#160;</font></td>
          </tr>
          <tr bgcolor="white">
            <td width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
            <td width="55%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">O'Donnell&#160;Iselin
              II&#160;</font></td>
            <td width="33%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Date&#160;</font></td>
          </tr>
          <tr bgcolor="white">
            <td width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
            <td width="55%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;Chief
              Financial Officer and Secretary (Principal Financial Officer)</font></td>
            <td width="33%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
          </tr>

      </table>
    </div>
    <div align="center">&#160;</div>
    <div align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">29</font></div>
  </body>
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</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-31.1
<SEQUENCE>2
<FILENAME>exh31-1.htm
<DESCRIPTION>EXHIBIT 31.1
<TEXT>
<html>
  <head>
    <title>
      Exhibit 31.1
</title>
<!-- Licensed to: Cadiz Inc-->
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</head>
  <body bgcolor="#ffffff">
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="right"><strong><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">
      EXHIBIT
      31.1 </font></strong></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="center"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>CERTIFICATION
      PURSUANT TO SECTION 302 OF THE</strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>SARBANES-OXLEY
      ACT OF 2002</strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">I,
      Keith
      Brackpool, certify that:</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">1.
      I have
      reviewed this Quarterly Report on Form 10-Q of Cadiz Inc.;</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2.
      Based
      on my knowledge, this report does not contain any untrue statement of a material
      fact or omit to state a material fact necessary to make the statements made,
      in
      light of the circumstances under which such statements were made, not misleading
      with respect to the period covered by this report;</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">3.
      Based
      on my knowledge, the financial statements, and other financial information
      included in this report, fairly present in all material respects the financial
      condition, results of operations and cash flows of the registrant as of, and
      for, the periods presented in this report;</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">4.
      The
      registrant's other certifying officer and I are responsible for establishing
      and
      maintaining disclosure controls and procedures (as defined in Exchange Act
      Rules
      13a-15(e) and 15d-15(e)) and internal control over financial reporting (as
      defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and
      have:</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 90pt; TEXT-INDENT: -27pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 63pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">a)
      Designed such disclosure controls and procedures, or caused such disclosure
      controls and procedures to be designed under our supervision, to ensure that
      material information relating to the registrant, including its consolidated
      subsidiaries, is made known to us by others within those entities, particularly
      during the period in which this report is being prepared;</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 63pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 63pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">b)
      Designed such internal control over financial reporting, or caused such internal
      control over financial reporting to be designed under our supervision, to
      provide reasonable assurance regarding the reliability of financial reporting
      and the preparation of financial statements for external purposes in accordance
      with generally accepted accounting principles.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 63pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 63pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">c)
      Evaluated the effectiveness of the registrant's disclosure controls and
      procedures and presented in this report our conclusions about the effectiveness
      of the disclosure controls and procedures, as of the end of the period covered
      by this report based on such evaluation; and</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 63pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 63pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">d)
      Disclosed in this report any change in the registrant's internal control over
      financial reporting that occurred during the registrant's most recent fiscal
      quarter (the registrant's fourth fiscal quarter in the case of an annual report)
      that has materially affected, or is reasonable likely to materially affect,
      the
      registrant's internal control over financial reporting; and</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">5.
      The
      registrant's other certifying officer and I have disclosed, based on our most
      recent evaluation of internal control over financial reporting, to the
      registrant's auditors and the audit committee of the registrant's board of
      directors (or persons performing the equivalent functions):</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 63pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">a)
      All
      significant deficiencies and material weaknesses in the design or operation
      of
      internal control over financial reporting which are reasonably likely to
      adversely affect the registrant's ability to record, process, summarize and
      report financial information; and</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 63pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 63pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">b)
      Any
      fraud, whether or not material, that involves management or other employees
      who
      have a significant role in the registrant's internal control over financial
      reporting.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Dated:&#160;
      August 6, 2007</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>/s/
      Keith Brackpool</u></font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 27pt">&#160;</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 27pt">&#160;</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 27pt">&#160;</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 27pt">&#160;</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Keith
      Brackpool<br></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Chairman
      and Chief Executive Officer </font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="left"><br></div>
  </body>
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</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-31.2
<SEQUENCE>3
<FILENAME>exh31-2.htm
<DESCRIPTION>EXHIBIT 31.2
<TEXT>
<html>
  <head>
    <title>
      Exhibit 31.2
</title>
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  <body bgcolor="#ffffff">
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>EXHIBIT
      31.2 </strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="center"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>CERTIFICATION
      PURSUANT TO SECTION 302 OF THE</strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>SARBANES-OXLEY
      ACT OF 2002</strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">I,
      O'Donnell Iselin II, certify that:</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">1.
      I have
      reviewed this Quarterly Report on Form 10-Q of Cadiz Inc.;</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2.
      Based
      on my knowledge, this report does not contain any untrue statement of a material
      fact or omit to state a material fact necessary to make the statements made,
      in
      light of the circumstances under which such statements were made, not misleading
      with respect to the period covered by this report;</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">3.
      Based
      on my knowledge, the financial statements, and other financial information
      included in this report, fairly present in all material respects the financial
      condition, results of operations and cash flows of the registrant as of, and
      for, the periods presented in this report;</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">4.
      The
      registrant's other certifying officer and I are responsible for establishing
      and
      maintaining disclosure controls and procedures (as defined in Exchange Act
      Rules
      13a-15(e) and 15d-15(e)) and internal control over financial reporting (as
      defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and
      have:</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 90pt; TEXT-INDENT: -27pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 63pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">a)
      Designed such disclosure controls and procedures, or caused such disclosure
      controls and procedures to be designed under our supervision, to ensure that
      material information relating to the registrant, including its consolidated
      subsidiaries, is made known to us by others within those entities, particularly
      during the period in which this report is being prepared;</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 63pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 63pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">b)
      Designed such internal control over financial reporting, or caused such internal
      control over financial reporting to be designed under our supervision, to
      provide reasonable assurance regarding the reliability of financial reporting
      and the preparation of financial statements for external purposes in accordance
      with generally accepted accounting principles.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 63pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 63pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">c)
      Evaluated the effectiveness of the registrant's disclosure controls and
      procedures and presented in this report our conclusions about the effectiveness
      of the disclosure controls and procedures, as of the end of the period covered
      by this report based on such evaluation; and</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 63pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 63pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">d)
      Disclosed in this report any change in the registrant's internal control over
      financial reporting that occurred during the registrant's most recent fiscal
      quarter (the registrant's fourth fiscal quarter in the case of an annual report)
      that has materially affected, or is reasonable likely to materially affect,
      the
      registrant's internal control over financial reporting; and</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">5.
      The
      registrant's other certifying officer and I have disclosed, based on our most
      recent evaluation of internal control over financial reporting, to the
      registrant's auditors and the audit committee of the registrant's board of
      directors (or persons performing the equivalent functions):</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 63pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">a)
      All
      significant deficiencies and material weaknesses in the design or operation
      of
      internal control over financial reporting which are reasonably likely to
      adversely affect the registrant's ability to record, process, summarize and
      report financial information; and</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 63pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 63pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">b)
      Any
      fraud, whether or not material, that involves management or other employees
      who
      have a significant role in the registrant's internal control over financial
      reporting.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Dated:
      August 6, 2007</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>/s/
      O'Donnell Iselin II</u></font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 27pt">&#160;</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 27pt">&#160;</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 27pt">&#160;</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 27pt">&#160;</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">O'Donnell
      Iselin II</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.1; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Chief
      Financial Officer and Secretary </font></div>
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</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-32.1
<SEQUENCE>4
<FILENAME>exh32-1.htm
<DESCRIPTION>EXHIBIT 32.1
<TEXT>
<html>
  <head>
    <title>
      Exhibit 32.1
</title>
<!-- Licensed to: Cadiz Inc-->
<!-- Document Created using EDGARizer HTML 3.0.4.0 -->
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  <body bgcolor="#ffffff"><br>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>EXHIBIT
      32.1</strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><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"><strong>STATEMENT
      PURSUANT TO SECTION 906 THE SARBANES-OXLEY ACT OF 2002 BY PRINCIPAL EXECUTIVE
      OFFICER AND PRINCIPAL FINANCIAL OFFICER</strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><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">I,
      Keith
      Brackpool, herby certify, to my knowledge, that:</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><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">1.
      the
      accompanying Quarterly Report on Form 10-Q of Cadiz Inc. for the period ended
      June 30, 2007 (the "Report") fully complies with the requirements of Section
      13(a) or 15(d), as applicable, of the Securities and Exchange Act of 1934,
      as
      amended; and</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><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">2.
      the
      information contained in the Report fairly presents, in all material respects,
      the financial condition and results of operations of Cadiz Inc.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><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">IN
      WITNESS WHEREOF, the undersigned has executed this Statement as of the date
      first written above.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><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">Dated:&#160;
      August 6, 2007</font><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><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"><u>/s/
      Keith Brackpool</u></font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 27pt">&#160;</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 27pt">&#160;</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 27pt">&#160;</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">Keith
      Brackpool</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">Chairman
      and Chief Executive Officer</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"><br></div>
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</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-32.2
<SEQUENCE>5
<FILENAME>exh32-2.htm
<DESCRIPTION>EXHIBIT 32.2
<TEXT>
<html>
  <head>
    <title>
      Exhibit 32.2
</title>
<!-- Licensed to: Cadiz Inc-->
<!-- Document Created using EDGARizer HTML 3.0.4.0 -->
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</head>
  <body bgcolor="#ffffff"><br>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>EXHIBIT
      32.2</strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><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"><strong>STATEMENT
      PURSUANT TO SECTION 906 THE SARBANES-OXLEY ACT OF 2002 BY PRINCIPAL EXECUTIVE
      OFFICER AND PRINCIPAL FINANCIAL OFFICER</strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><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">I,
      O'Donnell Iselin II, herby certify, to my knowledge, that:</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><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">1.
      the
      accompanying Quarterly Report on Form 10-Q of Cadiz Inc. for the period ended
      June 30, 2007 (the "Report") fully complies with the requirements of Section
      13(a) or 15(d), as applicable, of the Securities and Exchange Act of 1934,
      as
      amended; and</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><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">2.
      the
      information contained in the Report fairly presents, in all material respects,
      the financial condition and results of operations of Cadiz Inc.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><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">IN
      WITNESS WHEREOF, the undersigned has executed this Statement as of the date
      first written above.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><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">Dated:
      August 6, 2007</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"><u>/s/
      O'Donnell Iselin II__ </u></font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 27pt">&#160;</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 27pt">&#160;</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">O'Donnell
      Iselin II</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">Chief
      Financial Officer and Secretary</font></div>
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</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-3.1
<SEQUENCE>6
<FILENAME>exh3-1.htm
<DESCRIPTION>EXHIBIT 3.1
<TEXT>
<html>
  <head>
    <title>
      Exhibit 3.1
</title>
<!-- Licensed to: Cadiz Inc-->
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  <body bgcolor="#ffffff">
    <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><strong><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">EXHIBIT
      3.1</font></strong></div>
    <div><br>&#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"><strong>CERTIFICATE
      OF ELIMINATION</strong></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"><strong>OF</strong></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"><strong>SERIES
      F PREFERRED STOCK,</strong></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"><strong>OF</strong></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"><strong>CADIZ
      INC.</strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><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"><strong>(Pursuant
      to Section 151(g) of the</strong></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"><strong>Delaware
      General Corporation Law)</strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><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">Cadiz
      Inc., a corporation organized and existing under the General Corporation Law
      of
      the State of Delaware (the "Corporation") does hereby certify that the following
      resolutions respecting the Corporation&#8217;s Series F Preferred Stock were duly
      adopted by the Corporation's Board of Directors: </font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">WHEREAS,
      no shares of the Corporation's Series F Preferred Stock are outstanding and
      no
      shares of Series F Preferred Stock will be issued subject to the certificate
      of
      designation previously filed with respect to the Series F Preferred
      Stock;</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">NOW,
      THEREFORE, IT IS HEREBY RESOLVED, that the officers of the Corporation be,
      and
      each of them is hereby, authorized, empowered and directed to cause a
      certificate of elimination with respect to the Corporation&#8217;s Series F Preferred
      Stock to be executed and filed with the Secretary of the State of Delaware
      pursuant to Section 151(g) of the Delaware General Corporation Law in order
      to
      eliminate from the Corporation's certificate of incorporation all matters set
      forth in the certificate of designation with respect to the Series F Preferred
      Stock.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; 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">IN
      WITNESS WHEREOF, the Corporation has caused this Certificate to be signed by
      its
      duly authorized officer this 24th day of July, 2007.</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">&#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">CADIZ
      INC.</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">&#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">By:
      </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>/s/
      O'Donnell Iselin II&#160;</u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font size="2">&#160;&#160;&#160;&#160;&#160;&#160;
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">O'Donnell
      Iselin II</font></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font size="2">&#160;&#160;&#160;&#160;&#160;&#160;
<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Secretary</font></font></div>
  </body>
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</TEXT>
</DOCUMENT>
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