-----BEGIN PRIVACY-ENHANCED MESSAGE-----
Proc-Type: 2001,MIC-CLEAR
Originator-Name: webmaster@www.sec.gov
Originator-Key-Asymmetric:
 MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen
 TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB
MIC-Info: RSA-MD5,RSA,
 VY1MN1rRQWZNUONfOPwBTE7PSgLeYwzO3oJQNfAeElfgmeQoYsm/RymYp5JmHUi/
 9mEzN8bho1sMo5d25GslSQ==

<SEC-DOCUMENT>0001104659-08-032732.txt : 20080513
<SEC-HEADER>0001104659-08-032732.hdr.sgml : 20080513
<ACCEPTANCE-DATETIME>20080513132529
ACCESSION NUMBER:		0001104659-08-032732
CONFORMED SUBMISSION TYPE:	10-Q
PUBLIC DOCUMENT COUNT:		5
CONFORMED PERIOD OF REPORT:	20080329
FILED AS OF DATE:		20080513
DATE AS OF CHANGE:		20080513

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			APPLIANCE RECYCLING CENTERS OF AMERICA INC /MN
		CENTRAL INDEX KEY:			0000862861
		STANDARD INDUSTRIAL CLASSIFICATION:	RETAIL-HOME FURNITURE, FURNISHINGS & EQUIPMENT STORES [5700]
		IRS NUMBER:				411454591
		STATE OF INCORPORATION:			MN
		FISCAL YEAR END:			0103

	FILING VALUES:
		FORM TYPE:		10-Q
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	000-19621
		FILM NUMBER:		08826714

	BUSINESS ADDRESS:	
		STREET 1:		7400 EXCELSIOR BLVD
		CITY:			MINNEAPOLIS
		STATE:			MN
		ZIP:			55426-4502
		BUSINESS PHONE:		6129309000

	MAIL ADDRESS:	
		STREET 1:		7400 EXCELSIOR BLVD
		CITY:			NINNEAPOLIS
		STATE:			MN
		ZIP:			554264517
</SEC-HEADER>
<DOCUMENT>
<TYPE>10-Q
<SEQUENCE>1
<FILENAME>a08-11369_110q.htm
<DESCRIPTION>10-Q
<TEXT>

<html>

<head>





</head>

<body lang="EN-US">

<div style="font-family:Times New Roman;">

<div style="border:none;border-top:double windowtext 6.0pt;padding:0in 0in 0in 0in;">

<p align="center" style="border:none;font-size:10.0pt;letter-spacing:-.1pt;margin:0in 0in .0001pt;padding:0in;text-align:center;">&nbsp;</p>

</div>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="5" face="Times New Roman" style="font-size:18.0pt;font-weight:bold;letter-spacing:-.1pt;">UNITED STATES</font></b></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="5" face="Times New Roman" style="font-size:18.0pt;font-weight:bold;letter-spacing:-.1pt;">SECURITIES AND EXCHANGE COMMISSION</font></b></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;letter-spacing:-.1pt;">Washington, D.C. 20549</font></b></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="5" face="Times New Roman" style="font-size:18.0pt;font-weight:bold;letter-spacing:-.2pt;">FORM&nbsp;10-Q</font></b></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="font-size:10.0pt;letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="2" face="Wingdings" style="font-size:10.0pt;font-weight:bold;letter-spacing:-.1pt;">x</font></b><b><font size="3" style="font-size:12.0pt;font-weight:bold;letter-spacing:-.1pt;"> Quarterly Report Pursuant to Section&nbsp;13 or
15(d)</font></b><br>
<b><font size="3" style="font-size:12.0pt;font-weight:bold;letter-spacing:-.1pt;">of
the Securities Exchange Act of 1934</font></b></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;letter-spacing:-.1pt;">For the quarterly period ended March&nbsp;29,
2008</font></b></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;letter-spacing:-.1pt;">or</font></b></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="font-size:10.0pt;letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="2" face="Wingdings" style="font-size:10.0pt;font-weight:bold;letter-spacing:-.1pt;">o</font></b><b><font size="3" style="font-size:12.0pt;font-weight:bold;letter-spacing:-.1pt;"> Transition Report Pursuant to Section&nbsp;13 or
15(d)</font></b><br>
<b><font size="3" style="font-size:12.0pt;font-weight:bold;letter-spacing:-.1pt;">of
the Securities Exchange Act of 1934</font></b></p>

<p align="center" style="font-size:10.0pt;letter-spacing:-.1pt;margin:0in 0in .0001pt;text-align:center;">&nbsp;</p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;letter-spacing:-.1pt;">Commission File
No.&nbsp;0-19621</font></b></p>

<p align="center" style="font-size:10.0pt;letter-spacing:-.1pt;margin:0in 0in .0001pt;text-align:center;">&nbsp;</p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="5" face="Times New Roman" style="font-size:18.0pt;font-weight:bold;letter-spacing:-.2pt;">APPLIANCE RECYCLING CENTERS OF AMERICA, INC.</font></b></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:-.1pt;">(Exact name of registrant as
specified in its charter)</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<div align="center">

<table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;width:100.0%;">
 <tr>
  <td width="49%" valign="top" style="padding:0in 0in 0in 0in;width:49.0%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;text-autospace:none;"><b><font size="2" color="black" face="Times New Roman" style="color:black;font-size:10.0pt;font-weight:bold;letter-spacing:0pt;">Minnesota</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-autospace:none;"><b><font size="2" color="black" face="Times New Roman" style="color:black;font-size:1.0pt;font-weight:bold;letter-spacing:0pt;">&nbsp;</font></b></p>
  </td>
  <td width="49%" valign="top" style="padding:0in 0in 0in 0in;width:49.0%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;text-autospace:none;"><b><font size="2" color="black" face="Times New Roman" style="color:black;font-size:10.0pt;font-weight:bold;letter-spacing:0pt;">41-1454591</font></b></p>
  </td>
 </tr>
 <tr>
  <td width="49%" valign="top" style="padding:0in 0in 0in 0in;width:49.0%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;text-autospace:none;"><font size="2" color="black" face="Times New Roman" style="color:black;font-size:10.0pt;letter-spacing:0pt;">(State or other jurisdiction of</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-autospace:none;"><font size="2" color="black" face="Times New Roman" style="color:black;font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="49%" valign="top" style="padding:0in 0in 0in 0in;width:49.0%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;text-autospace:none;"><font size="2" color="black" face="Times New Roman" style="color:black;font-size:10.0pt;letter-spacing:0pt;">(I.R.S. Employer</font></p>
  </td>
 </tr>
 <tr>
  <td width="49%" valign="top" style="padding:0in 0in 0in 0in;width:49.0%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;text-autospace:none;"><font size="2" color="black" face="Times New Roman" style="color:black;font-size:10.0pt;letter-spacing:0pt;">incorporation or organization)</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-autospace:none;"><font size="2" color="black" face="Times New Roman" style="color:black;font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="49%" valign="top" style="padding:0in 0in 0in 0in;width:49.0%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;text-autospace:none;"><font size="2" color="black" face="Times New Roman" style="color:black;font-size:10.0pt;letter-spacing:0pt;">Identification No.)</font></p>
  </td>
 </tr>
 <tr>
  <td width="49%" valign="top" style="padding:0in 0in 0in 0in;width:49.0%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;text-autospace:none;"><b><font size="2" color="black" face="Times New Roman" style="color:black;font-size:10.0pt;font-weight:bold;letter-spacing:0pt;">&nbsp;</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-autospace:none;"><b><font size="2" color="black" face="Times New Roman" style="color:black;font-size:10.0pt;font-weight:bold;letter-spacing:0pt;">&nbsp;</font></b></p>
  </td>
  <td width="49%" valign="top" style="padding:0in 0in 0in 0in;width:49.0%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;text-autospace:none;"><b><font size="2" color="black" face="Times New Roman" style="color:black;font-size:10.0pt;font-weight:bold;letter-spacing:0pt;">&nbsp;</font></b></p>
  </td>
 </tr>
 <tr>
  <td width="49%" valign="top" style="padding:0in 0in 0in 0in;width:49.0%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;text-autospace:none;"><b><font size="2" color="black" face="Times New Roman" style="color:black;font-size:10.0pt;font-weight:bold;letter-spacing:0pt;">7400 Excelsior Boulevard, Minneapolis, Minnesota</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-autospace:none;"><b><font size="2" color="black" face="Times New Roman" style="color:black;font-size:1.0pt;font-weight:bold;letter-spacing:0pt;">&nbsp;</font></b></p>
  </td>
  <td width="49%" valign="top" style="padding:0in 0in 0in 0in;width:49.0%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;text-autospace:none;"><b><font size="2" color="black" face="Times New Roman" style="color:black;font-size:10.0pt;font-weight:bold;letter-spacing:0pt;">55426-4517</font></b></p>
  </td>
 </tr>
 <tr>
  <td width="49%" valign="top" style="padding:0in 0in 0in 0in;width:49.0%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;text-autospace:none;"><font size="2" color="black" face="Times New Roman" style="color:black;font-size:10.0pt;letter-spacing:0pt;">(Address of principal executive offices)</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-autospace:none;"><font size="2" color="black" face="Times New Roman" style="color:black;font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="49%" valign="top" style="padding:0in 0in 0in 0in;width:49.0%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;text-autospace:none;"><font size="2" color="black" face="Times New Roman" style="color:black;font-size:10.0pt;letter-spacing:0pt;">(Zip Code)</font></p>
  </td>
 </tr>
</table>

</div>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:-.1pt;">Registrant&#146;s telephone number,
including area code: <b>952-930-9000</b></font></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<div align="center">

<table border="0" cellspacing="0" cellpadding="0" width="720" style="border-collapse:collapse;width:7.5in;">
 <tr>
  <td width="49%" valign="top" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:49.0%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;letter-spacing:-.1pt;">Common Stock, without par value</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;letter-spacing:-.1pt;">&nbsp;</font></b></p>
  </td>
  <td width="49%" valign="top" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:49.0%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;letter-spacing:-.1pt;">NASDAQ Capital Market</font></b></p>
  </td>
 </tr>
 <tr>
  <td width="49%" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:49.0%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Title&nbsp;of&nbsp;each&nbsp;class</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="49%" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:49.0%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Name&nbsp;of&nbsp;each&nbsp;exchange&nbsp;on&nbsp;which&nbsp;registered</font></p>
  </td>
 </tr>
</table>

</div>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 8.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:-.1pt;">Securities registered pursuant to Section&nbsp;12(g)&nbsp;of
the Act: <b>None</b></font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Indicate by check mark if the registrant is a well-known seasoned
issuer, as defined in Rule&nbsp;405 of the Securities Act.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;width:100.0%;">
 <tr>
  <td width="50%" valign="top" style="padding:0in 0in 0in 0in;width:50.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="50%" valign="top" style="padding:0in 0in 0in 0in;width:50.0%;">
  <p align="right" style="font-size:10.0pt;letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Wingdings" style="font-size:10.0pt;">o</font>&nbsp;&nbsp;Yes&nbsp;&nbsp;&nbsp;<font face="Wingdings">x</font>&nbsp;&nbsp;No</p>
  </td>
 </tr>
</table>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Indicate by check mark whether the registrant (1)&nbsp;has filed all
reports required to be filed by Section&nbsp;13 or 15(d)&nbsp;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)&nbsp;has been
subject to such filing requirements for the past 90 days.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;width:100.0%;">
 <tr>
  <td width="50%" valign="top" style="padding:0in 0in 0in 0in;width:50.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="50%" valign="top" style="padding:0in 0in 0in 0in;width:50.0%;">
  <p align="right" style="font-size:10.0pt;letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Wingdings" style="font-size:10.0pt;">x</font>&nbsp;&nbsp;Yes&nbsp;&nbsp;&nbsp;<font face="Wingdings">o</font>&nbsp;&nbsp;No</p>
  </td>
 </tr>
</table>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Indicate by check mark whether the registrant is a large accelerated
filer, an accelerated filer, a non-accelerated filer, or a smaller reporting
company. See definitions of &#147;large accelerated filer,&#148; &#147;accelerated filer,&#148; and
&#147;smaller reporting company&#148; in Rule&nbsp;12b-2 of the Exchange Act. (Check
one):</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<div align="center">

<table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;width:100.0%;">
 <tr>
  <td width="49%" valign="top" style="padding:0in .7pt 0in .7pt;width:49.0%;">
  <p align="center" style="font-size:10.0pt;letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Large
  accelerated filer </font><font face="Wingdings">o</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:2.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="49%" valign="top" style="padding:0in .7pt 0in .7pt;width:49.0%;">
  <p align="center" style="font-size:10.0pt;letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Accelerated
  filer&nbsp;</font><font face="Wingdings">o</font></p>
  </td>
 </tr>
 <tr>
  <td width="49%" valign="top" style="padding:0in .7pt 0in .7pt;width:49.0%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:2.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="49%" valign="top" style="padding:0in .7pt 0in .7pt;width:49.0%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="49%" valign="top" style="padding:0in .7pt 0in .7pt;width:49.0%;">
  <p align="center" style="font-size:10.0pt;letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Non-accelerated
  filer </font><font face="Wingdings">o</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:2.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="49%" valign="top" style="padding:0in .7pt 0in .7pt;width:49.0%;">
  <p align="center" style="font-size:10.0pt;letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Smaller
  reporting company&nbsp;</font><font face="Wingdings">x</font></p>
  </td>
 </tr>
 <tr>
  <td width="49%" valign="top" style="padding:0in .7pt 0in .7pt;width:49.0%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(Do
  not check if a smaller reporting company)</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in .7pt 0in .7pt;width:2.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="49%" valign="top" style="padding:0in .7pt 0in .7pt;width:49.0%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
</table>

</div>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="font-size:10.0pt;letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Indicate by check mark whether the registrant
is a shell company (as defined in Rule&nbsp;12b-2 of the Exchange Act).&nbsp;&nbsp;&nbsp;</font><font face="Wingdings">o</font>&nbsp;&nbsp;Yes&nbsp;&nbsp;&nbsp;<font face="Wingdings">x</font>&nbsp;&nbsp;No</p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">As of May&nbsp;1, 2008, there were outstanding 4,567,777 shares of the
registrant&#146;s Common Stock, without par value.</font></p>

<div style="border:none;border-bottom:double windowtext 6.0pt;padding:0in 0in 0in 0in;">

<p style="border:none;letter-spacing:-.15pt;margin:0in 0in .0001pt;padding:0in;"><font size="2" face="Times New Roman">&nbsp;</font></p>

</div>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<div style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- SEQ.=1,FOLIO='',FILE='C:\JMS\eudelhofen\08-11369-1\task2936656\11369-1-ba-01.htm',USER='eudelho',CD='May 13 09:16 2008' -->


<br clear="all" style="page-break-before:always;">


<div>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">APPLIANCE RECYCLING CENTERS of AMERICA, INC.</font></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><i><font size="2" face="Times New Roman" style="font-size:10.0pt;font-style:italic;">Index</font></i></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;width:100.0%;">
 <tr>
  <td width="13%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:13.22%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="77%" valign="bottom" style="padding:0in 0in 0in 0in;width:77.78%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.34%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="6%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:6.66%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">Page&nbsp;No.</font></b></p>
  </td>
 </tr>
 <tr>
  <td width="8%" valign="top" style="padding:0in 0in 0in 0in;width:8.88%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">PART&nbsp;I.</font></p>
  </td>
  <td width="82%" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:82.12%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">FINANCIAL INFORMATION</font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.34%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="3%" valign="top" style="border:none;padding:0in 0in 0in 0in;width:3.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="top" style="border:none;border-top:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:2.78%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="13%" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:13.22%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="77%" valign="top" style="padding:0in 0in 0in 0in;width:77.78%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.34%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="3%" valign="top" style="padding:0in 0in 0in 0in;width:3.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.78%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="13%" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:13.22%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 30.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Item 1:</font></p>
  </td>
  <td width="77%" valign="top" style="padding:0in 0in 0in 0in;width:77.78%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Financial Statements:</font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.34%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="3%" valign="top" style="padding:0in 0in 0in 0in;width:3.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.78%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="13%" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:13.22%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="77%" valign="top" style="padding:0in 0in 0in 0in;width:77.78%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.34%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="3%" valign="top" style="padding:0in 0in 0in 0in;width:3.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.78%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="13%" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:13.22%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="77%" valign="top" style="padding:0in 0in 0in 0in;width:77.78%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;"><a href="#CondensedConsolidatedBalanceSheet_052609" title="Click to goto ">Condensed
  Consolidated Balance Sheets as of March&nbsp;29, 2008 (Unaudited) and
  December&nbsp;29, 2007</a></font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.34%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="3%" valign="top" style="padding:0in 0in 0in 0in;width:3.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">3</font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.78%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="13%" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:13.22%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="77%" valign="top" style="padding:0in 0in 0in 0in;width:77.78%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.34%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="3%" valign="top" style="padding:0in 0in 0in 0in;width:3.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.78%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="13%" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:13.22%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="77%" valign="top" style="padding:0in 0in 0in 0in;width:77.78%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman"><font style="font-size:10.0pt;"><a href="#CondensedConsolidatedStatementsOf_052617" title="Click to goto ">Condensed
  Consolidated Statements of Operations (Unaudited) for the Three Months Ended
  March&nbsp;29, 2008 and March&nbsp;31, 2007</a></font>  </font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.34%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="3%" valign="top" style="padding:0in 0in 0in 0in;width:3.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4</font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.78%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="13%" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:13.22%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="77%" valign="top" style="padding:0in 0in 0in 0in;width:77.78%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.34%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="3%" valign="top" style="padding:0in 0in 0in 0in;width:3.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.78%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="13%" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:13.22%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="77%" valign="top" style="padding:0in 0in 0in 0in;width:77.78%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;"><a href="#CondensedConsolidatedStatementsOf_052623" title="Click to goto ">Condensed
  Consolidated Statements of Cash Flows (Unaudited) for the Three Months Ended
  March&nbsp;29, 2008 and March&nbsp;31, 2007</a></font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.34%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="3%" valign="top" style="padding:0in 0in 0in 0in;width:3.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">5</font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.78%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="13%" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:13.22%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="77%" valign="top" style="padding:0in 0in 0in 0in;width:77.78%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.34%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="3%" valign="top" style="padding:0in 0in 0in 0in;width:3.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.78%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="13%" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:13.22%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="77%" valign="top" style="padding:0in 0in 0in 0in;width:77.78%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;"><a href="#CondensedNotesToConsolidatedFinan_052627" title="Click to goto ">Condensed
  Notes to Consolidated Financial Statements (Unaudited)</a></font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.34%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="3%" valign="top" style="padding:0in 0in 0in 0in;width:3.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">6</font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.78%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="13%" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:13.22%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="77%" valign="top" style="padding:0in 0in 0in 0in;width:77.78%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.34%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="3%" valign="top" style="padding:0in 0in 0in 0in;width:3.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.78%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="13%" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:13.22%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 30.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;"><a href="#PartiItem2ManagementsDiscussionAn_050247">Item 2:</a></font></p>
  </td>
  <td width="77%" valign="top" style="padding:0in 0in 0in 0in;width:77.78%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;"><a href="#PartiItem2ManagementsDiscussionAn_050247">Management&#146;s Discussion and Analysis of
  Financial Condition and Results of Operations</a></font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.34%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="3%" valign="top" style="padding:0in 0in 0in 0in;width:3.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">17</font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.78%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="13%" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:13.22%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="77%" valign="top" style="padding:0in 0in 0in 0in;width:77.78%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.34%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="3%" valign="top" style="padding:0in 0in 0in 0in;width:3.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.78%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="13%" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:13.22%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 30.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;"><a href="#PartiItem4ControlsAndProcedures_050457">Item 4:</a></font></p>
  </td>
  <td width="77%" valign="top" style="padding:0in 0in 0in 0in;width:77.78%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;"><a href="#PartiItem4ControlsAndProcedures_050457">Controls and Procedures</a></font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.34%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="3%" valign="top" style="padding:0in 0in 0in 0in;width:3.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">22</font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.78%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="13%" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:13.22%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="77%" valign="top" style="padding:0in 0in 0in 0in;width:77.78%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.34%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="3%" valign="top" style="padding:0in 0in 0in 0in;width:3.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.78%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="91%" colspan="3" valign="top" style="padding:0in 0in 0in 0in;width:91.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;"><a href="#Partii_OtherInformation_050614" title="Click to goto ">PART&nbsp;II.&nbsp;&nbsp;&nbsp;OTHER
  INFORMATION</a></font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.34%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="3%" valign="top" style="padding:0in 0in 0in 0in;width:3.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">23</font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.78%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="13%" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:13.22%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="77%" valign="top" style="padding:0in 0in 0in 0in;width:77.78%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.34%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="3%" valign="top" style="padding:0in 0in 0in 0in;width:3.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.78%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="13%" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:13.22%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 30.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;"><a href="#Item1LegalProceedings_050630">Item 1:</a></font></p>
  </td>
  <td width="77%" valign="top" style="padding:0in 0in 0in 0in;width:77.78%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;"><a href="#Item1LegalProceedings_050630">Legal Proceedings</a></font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.34%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="3%" valign="top" style="padding:0in 0in 0in 0in;width:3.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">23</font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.78%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="13%" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:13.22%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="77%" valign="top" style="padding:0in 0in 0in 0in;width:77.78%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.34%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="3%" valign="top" style="padding:0in 0in 0in 0in;width:3.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.78%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="13%" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:13.22%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 30.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;"><a href="#Item2UnregisteredSalesOfEquitySec_050840">Item 2:</a></font></p>
  </td>
  <td width="77%" valign="top" style="padding:0in 0in 0in 0in;width:77.78%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;"><a href="#Item2UnregisteredSalesOfEquitySec_050840">Unregistered Sales of Equity Securities and
  Use of Proceeds</a></font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.34%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="3%" valign="top" style="padding:0in 0in 0in 0in;width:3.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">23</font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.78%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="13%" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:13.22%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 30.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="77%" valign="top" style="padding:0in 0in 0in 0in;width:77.78%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.34%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="3%" valign="top" style="padding:0in 0in 0in 0in;width:3.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.78%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="13%" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:13.22%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 30.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;"><a href="#Item3DefaultsUponSeniorSecurities_050844">Item 3:</a></font></p>
  </td>
  <td width="77%" valign="top" style="padding:0in 0in 0in 0in;width:77.78%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;"><a href="#Item3DefaultsUponSeniorSecurities_050844">Defaults Upon Senior Securities</a></font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.34%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="3%" valign="top" style="padding:0in 0in 0in 0in;width:3.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">23</font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.78%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="13%" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:13.22%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 30.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="77%" valign="top" style="padding:0in 0in 0in 0in;width:77.78%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.34%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="3%" valign="top" style="padding:0in 0in 0in 0in;width:3.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.78%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="13%" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:13.22%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 30.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;"><a href="#Item4SubmissionOfMattersToAVoteOf_050845">Item 4:</a></font></p>
  </td>
  <td width="77%" valign="top" style="padding:0in 0in 0in 0in;width:77.78%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;"><a href="#Item4SubmissionOfMattersToAVoteOf_050845">Submission of Matters to a Vote of Security
  Holders</a></font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.34%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="3%" valign="top" style="padding:0in 0in 0in 0in;width:3.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">23</font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.78%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="13%" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:13.22%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 30.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="77%" valign="top" style="padding:0in 0in 0in 0in;width:77.78%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.34%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="3%" valign="top" style="padding:0in 0in 0in 0in;width:3.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.78%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="13%" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:13.22%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 30.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;"><a href="#Item5OtherInformationNone_050853">Item 5:</a></font></p>
  </td>
  <td width="77%" valign="top" style="padding:0in 0in 0in 0in;width:77.78%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;"><a href="#Item5OtherInformationNone_050853">Other Information</a></font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.34%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="3%" valign="top" style="padding:0in 0in 0in 0in;width:3.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">23</font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.78%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="13%" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:13.22%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 30.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="77%" valign="top" style="padding:0in 0in 0in 0in;width:77.78%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.34%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="3%" valign="top" style="padding:0in 0in 0in 0in;width:3.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.78%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="13%" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:13.22%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 30.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;"><a href="#Item6Exhibits_050854">Item 6:</a></font></p>
  </td>
  <td width="77%" valign="top" style="padding:0in 0in 0in 0in;width:77.78%;">
  <p style="letter-spacing:-.15pt;margin:0in .25in .0001pt 0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;"><a href="#Item6Exhibits_050854">Exhibits</a></font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.34%;">
  <p style="letter-spacing:-.15pt;margin:0in .25in .0001pt 0in;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="3%" valign="top" style="padding:0in 0in 0in 0in;width:3.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">24</font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.78%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="13%" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:13.22%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="77%" valign="top" style="padding:0in 0in 0in 0in;width:77.78%;">
  <p style="letter-spacing:-.15pt;margin:0in .25in .0001pt 0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.34%;">
  <p style="letter-spacing:-.15pt;margin:0in .25in .0001pt 0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="3%" valign="top" style="padding:0in 0in 0in 0in;width:3.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.78%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="91%" colspan="3" valign="top" style="padding:0in 0in 0in 0in;width:91.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;"><a href="#Signatures_050928" title="Click to goto ">SIGNATURES</a></font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.34%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="3%" valign="top" style="padding:0in 0in 0in 0in;width:3.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">25</font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.78%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="91%" colspan="3" valign="top" style="padding:0in 0in 0in 0in;width:91.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.34%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="3%" valign="top" style="padding:0in 0in 0in 0in;width:3.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.78%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="91%" colspan="3" valign="top" style="padding:0in 0in 0in 0in;width:91.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">EXHIBITS</font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.34%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="3%" valign="top" style="padding:0in 0in 0in 0in;width:3.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">26</font></p>
  </td>
  <td width="2%" valign="top" style="padding:0in 0in 0in 0in;width:2.78%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr height="0">
  <td width="66" style="border:none;"></td>
  <td width="32" style="border:none;"></td>
  <td width="582" style="border:none;"></td>
  <td width="18" style="border:none;"></td>
  <td width="29" style="border:none;"></td>
  <td width="21" style="border:none;"></td>
 </tr>
</table>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2</font></p>

<div style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- SEQ.=1,FOLIO='2',FILE='C:\JMS\eudelhofen\08-11369-1\task2936656\11369-1-ba-01.htm',USER='eudelho',CD='May 13 09:16 2008' -->



<br clear="all" style="page-break-before:always;">
<div style="font-family:Times New Roman;">

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;letter-spacing:0pt;">APPLIANCE RECYCLING CENTERS OF AMERICA, INC. AND SUBSIDIARIES</font></b></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;letter-spacing:0pt;">CONDENSED
CONSOLIDATED BALANCE SHEETS<a name="CondensedConsolidatedBalanceSheet_052609"></a></font></b></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="3" face="Times New Roman" style="font-size:12.0pt;">&nbsp;</font></p>

<table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;width:100.0%;">
 <tr>
  <td width="70%" valign="bottom" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">March&nbsp;29,<br>
  2008</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">December&nbsp;29,<br>
  2007</font></b></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><b><font size="2" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">(Unaudited)</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">ASSETS</font></b></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Current Assets:</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Cash</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.12%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">1,853,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.12%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2,777,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Accounts receivable, net of allowance of $170,000 and $152,000,
  respectively</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">5,689,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">10,086,000</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Inventories, net of reserves of $61,000 and $84,000, respectively</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">14,771,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">14,064,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Deferred income taxes</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">259,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">259,000</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Other current assets</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">687,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">995,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Total current assets</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">23,259,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">28,181,000</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Property and Equipment</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">15,483,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">15,154,000</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Less: accumulated depreciation</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">8,659,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">8,392,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Net property and equipment</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">6,824,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">6,762,000</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Other Assets</font></b></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">579,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">589,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Total assets</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.12%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" style="border-bottom:double windowtext 1.5pt;border-left:none;border-right:none;border-top:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:10.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">30,662,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.12%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" style="border-bottom:double windowtext 1.5pt;border-left:none;border-right:none;border-top:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:10.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">35,532,000</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">LIABILITIES AND SHAREHOLDERS&#146; EQUITY</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Current Liabilities:</font></b></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Accounts payable</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.12%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" style="padding:0in 0in 0in 0in;width:10.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2,014,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.12%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" style="padding:0in 0in 0in 0in;width:10.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4,350,000</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Checks issued in excess of cash in bank</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">75,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">310,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Accrued expenses</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">3,383,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4,113,000</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Line of credit</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">11,772,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">13,585,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Long-term obligations, current portion</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">530,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">479,000</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Income taxes payable</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">12,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">218,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Total current liabilities</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">17,786,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">23,055,000</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Long-Term Obligations,</font></b><b><font size="2" style="font-size:10.0pt;font-weight:bold;">  </font></b><font size="2" style="font-size:10.0pt;">less current
  maturities</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4,984,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4,956,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Deferred Income Tax Liabilities</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">259,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">259,000</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Total liabilities</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">23,029,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">28,270,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Commitments and Contingencies</font></b></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Shareholders&#146; Equity:</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Common Stock, no par value; authorized 10,000,000 shares; issued and
  outstanding 4,567,777 and 4,509,277 shares, respectively</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">15,754,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">15,475,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Accumulated deficit</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(8,172,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(8,289,000</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Accumulated Other Comprehensive Income:</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Foreign Currency Translation Adjustments</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">51,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">76,000</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Total shareholders&#146; equity</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">7,633,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">7,262,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Total liabilities and shareholders&#146; equity</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.12%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" style="border-bottom:double windowtext 1.5pt;border-left:none;border-right:none;border-top:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:10.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">30,662,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.12%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" style="border-bottom:double windowtext 1.5pt;border-left:none;border-right:none;border-top:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:10.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">35,532,000</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
</table>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">See Notes to Condensed Consolidated Financial
Statements.</font></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">3</font></p>

<div style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- SEQ.=1,FOLIO='3',FILE='C:\JMS\pselva\08-11369-1\task2935225\11369-1-ba-03.htm',USER='105344',CD='May 13 06:06 2008' -->


<br clear="all" style="page-break-before:always;">


<div>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;letter-spacing:0pt;">APPLIANCE RECYCLING CENTERS OF AMERICA, INC. AND SUBSIDIARIES</font></b></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;letter-spacing:0pt;">CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)</font></b><a name="CondensedConsolidatedStatementsOf_052617"></a></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;width:100.0%;">
 <tr>
  <td width="70%" valign="bottom" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="26%" colspan="5" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:26.5%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">For&nbsp;the&nbsp;three&nbsp;months&nbsp;ended</font></b></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="bottom" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">March&nbsp;29,&nbsp;2008</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="border:none;border-top:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:2.5%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border-bottom:solid windowtext 1.0pt;border-left:none;border-right:none;border-top:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">March&nbsp;31,&nbsp;2007</font></b></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Revenues</font></b></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Retail</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.12%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" style="padding:0in 0in 0in 0in;width:10.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">18,962,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.12%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" style="padding:0in 0in 0in 0in;width:10.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">17,689,000</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Recycling</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">5,944,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">1,894,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Byproduct</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">900,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">349,000</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Total revenues</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">25,806,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">19,932,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Cost of Revenues</font></b></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">17,826,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">13,366,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Gross profit</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">7,980,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">6,566,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Selling, General and Administrative Expenses</font></b></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">7,579,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">6,742,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Operating income (loss)</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">401,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(176,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Other Income (Expense)</font></b></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Other income</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#151;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2,000</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Interest expense</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(397,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0.375pt 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(298,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0.375pt 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Income (loss) before provision for income taxes</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(472,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Provision for (benefit of) income taxes</font></b></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(113,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0.375pt 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#151;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Net income (loss)</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.12%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:10.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">117,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.12%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:10.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(472,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0.75pt 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Basic Income (Loss) per Common Share</font></b></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.12%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:10.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">0.03</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.12%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:10.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(0.11</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0.75pt 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Diluted Income (Loss) per Common Share</font></b></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.12%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:10.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">0.03</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.12%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:10.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(0.11</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0.75pt 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Weighted Average Number of Common Shares
  Outstanding:</font></b></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Basic</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4,556,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4,341,000</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Diluted</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4,624,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4,341,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
</table>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">See Notes to Condensed Consolidated Financial
Statements.</font></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4</font></p>

<div style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- SEQ.=1,FOLIO='4',FILE='C:\JMS\pselva\08-11369-1\task2935225\11369-1-ba-03.htm',USER='105344',CD='May 13 06:06 2008' -->


<br clear="all" style="page-break-before:always;">


<div>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;letter-spacing:0pt;">APPLIANCE RECYCLING CENTERS OF AMERICA,
INC. AND SUBSIDIARIES</font></b></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;letter-spacing:0pt;">CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)</font></b><a name="CondensedConsolidatedStatementsOf_052623"></a></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="3" face="Times New Roman" style="font-size:12.0pt;">&nbsp;</font></p>

<table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;width:100.0%;">
 <tr>
  <td width="70%" valign="bottom" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="26%" colspan="5" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:26.5%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">For&nbsp;the&nbsp;three&nbsp;months&nbsp;ended</font></b></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="bottom" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">March&nbsp;29,<br>
  2008</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="border:none;border-top:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:2.5%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border-bottom:solid windowtext 1.0pt;border-left:none;border-right:none;border-top:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">March&nbsp;31,<br>
  2007</font></b></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Cash Flows from Operating Activities</font></b></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Net Income (loss)</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.12%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" style="padding:0in 0in 0in 0in;width:10.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">117,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.12%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" style="padding:0in 0in 0in 0in;width:10.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(472,000</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Adjustments to reconcile net loss to net cash provided by operating
  activities:</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Depreciation and amortization</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">267,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">193,000</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Stock-based compensation expense</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">78,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">11,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Change in assets and liabilities:</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 30.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Accounts Receivable</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4,397,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">320,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 30.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Inventories</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(707,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(344,000</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 30.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Other current assets</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">325,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">298,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 30.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Other assets</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">10,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4,000</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 30.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Accounts payable and accrued expenses</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(3,066,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">530,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 30.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Income taxes payable</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(206,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0.375pt 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#151;</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 40.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Net cash flows from operating activities</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">1,215,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">540,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Cash Flows from Investing Activities</font></b></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Purchases of property and equipment</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(173,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0.375pt 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(82,000</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0.375pt 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 40.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Net cash flows from investing activities</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(173,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0.375pt 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(82,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0.375pt 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Cash Flows from Financing Activities</font></b></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Checks issued in excess of cash in bank</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(235,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#151;</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Net payments under line of credit</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(1,813,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(70,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Payments on long-term obligations</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(94,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(65,000</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Proceeds from stock option exercises</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">201,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#151;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 40.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Net cash flows from financing activities</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(1,941,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0.375pt 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(135,000</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0.375pt 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Effect of exchange rate changes on cash</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(25,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0.375pt 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#151;</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Increase (Decrease) in cash</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(924,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">323,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Cash, beginning of period</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2,777,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2,753,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Cash, end of period</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.12%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" style="border-bottom:double windowtext 1.5pt;border-left:none;border-right:none;border-top:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:10.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">1,853,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.12%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" style="border-bottom:double windowtext 1.5pt;border-left:none;border-right:none;border-top:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:10.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">3,076,000</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Supplemental Disclosures of Cash Flow
  Information</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Cash payments relative to:</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 30.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Interest</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.12%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" style="border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:10.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">397,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.12%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" style="border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:10.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">298,000</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 30.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Income taxes, net</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.12%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:10.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">78,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.12%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:10.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#151;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Noncash investing and financing activites:</font></b></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Equipment and other current assets acquired under capital lease</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.12%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" style="border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:10.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">173,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.12%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" style="border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:10.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#151;</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
</table>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">See Notes to Condensed
Consolidated Financial Statements.</font></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">5</font></p>

<div style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- SEQ.=1,FOLIO='5',FILE='C:\JMS\pselva\08-11369-1\task2935225\11369-1-ba-03.htm',USER='105344',CD='May 13 06:06 2008' -->


<br clear="all" style="page-break-before:always;">


<div style="font-family:Times New Roman;">

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Appliance Recycling Centers of America,&nbsp;Inc. and Subsidiaries</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">CONDENSED NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)<a name="CondensedNotesToConsolidatedFinan_052627"></a></font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .75in;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">1.</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><u><font size="2" style="font-size:10.0pt;">Basis of Presentation</font></u></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .75in;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">In the opinion of Company management, the accompanying unaudited
consolidated financial statements contain all adjustments (consisting of only
normal, recurring accruals) necessary to present fairly our financial position,
including our subsidiaries, as of March&nbsp;29, 2008 and the results of
operations and cash flows for the three-month periods ended March&nbsp;29, 2008
and March&nbsp;31, 2007.&#160; The three
months presented are 13-week periods, respectively.&#160; The results of operations for any interim
period are not necessarily indicative of the results for the year.&#160; These interim consolidated financial
statements should be read in conjunction with our annual consolidated financial
statements and related notes in our Annual Report on Form&nbsp;10-K for the
year ended December&nbsp;29, 2007.&#160;
Therefore, certain information and footnote disclosures included in the
annual consolidated financial statements prepared in accordance with accounting
principles generally accepted in the United States of America, have been
condensed or omitted.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;text-indent:-.25in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2.</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><u><font size="2" style="font-size:10.0pt;">Recent Accounting
Pronouncements</font></u></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .25in;text-indent:-.25in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:-.1pt;">The following items represent accounting standards
that have recently been issued.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">During September&nbsp;2006,
the Financial Accounting Standards Board (FASB) issued Statement of Financial
Accounting Standards (SFAS) No.&nbsp;157, &#147;Fair Value Measurements&#148; (&#147;SFAS 157&#148;).&#160; This statement defines fair value,
establishes a framework for measuring fair value under generally accepted
accounting principles, and expands disclosures about fair value
measurements.&#160; SFAS 157 is effective for
financial statements issued for fiscal years beginning after November&nbsp;15,
2007, however, during February&nbsp;2008, the FASB issued FASB Staff Position
SFAS 157-2 which, deferred the effective date of certain provisions of SFAS 157
until fiscal years beginning after November&nbsp;15, 2008.&#160; We adopted the provisions of SFAS 157 that
were not deferred under SFAS 157-2 effective December&nbsp;30, 2007.&#160; The adoption had no impact on our
consolidated financial statements.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">During February&nbsp;2007,
the Financial Accounting Standards Board issued Statement of Financial
Accounting Standards (SFAS) No.&nbsp;159, &#147;The Fair Value Option for Financial
Assets and Financial Liabilities&#148; (&#147;SFAS 159&#148;).&#160;
This statement permits entities to choose to measure many financial
instruments and certain other items at fair value.&#160; SFAS 159 is effective for fiscal years
beginning after November&nbsp;15, 2007.&#160;
The adoption of SFAS 159 on December&nbsp;30, 2007 had no impact on our
consolidated financial statements.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">During December&nbsp;2007,
the Financial Accounting Standards Board issued Statement of Financial
Accounting Standards (SFAS) No.&nbsp;160, &#147;Noncontrolling Interests in
Consolidated Financial Statements and amendment of ARB No.&nbsp;51&#148; (&#147;SFAS 160&#148;).&#160; This statement establishes accounting and
reporting standards for noncontrolling interests in subsidiaries and for the
deconsolidation of subsidiaries and clarifies that a noncontrolling interest in
a subsidiary is an ownership interest in the</font></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">6</font></p>

<div style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- SEQ.=1,FOLIO='6',FILE='C:\JMS\pselva\08-11369-1\task2935225\11369-1-ba-03.htm',USER='105344',CD='May 13 06:06 2008' -->


<br clear="all" style="page-break-before:always;">


<div style="font-family:Times New Roman;">

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">consolidated entity that
should be reported as equity in the consolidated financial statements.&#160; This statement also requires expanded
disclosures that clearly identify and distinguish between the interests of the
parent owners and the interests of the noncontrolling owners of a
subsidiary.&#160; SFAS 160 is effective for
fiscal years beginning on or after December&nbsp;15, 2008.&#160; We do not believe the adoption of SFAS 160
will have a material effect on our results of operations or financial position.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">During December&nbsp;2007,
the Financial Accounting Standards Board issued Statement of Financial
Accounting Standards (SFAS) No.&nbsp;141, (Revised 2007), &#147;Business Combinations&#148;
(SFAS 141 (Revised 2007)&#148;).&#160; While this
statement retains the fundamental requirement of SFAS 141 that the acquisition
method of accounting (which SFAS 141 called the <i>purchase
method</i>) be used for all business combinations, SFAS 141 (Revised
2007) now establishes the principles and requirements for how an acquirer in a
business combination:&#160; recognizes and
measures in its financial statements the identifiable assets acquired, the
liabilities assumed, and any noncontrolling interests in the acquiree; recognizes
and measures the goodwill acquired in the business combination or the gain from
a bargain purchase; and determines what information should be disclosed in the
financial statements to enable users of the financial statements to evaluate
the nature and financial effects of the business combination.&#160; SFAS 141 (Revised 2007) is effective for
fiscal years beginning on or after December&nbsp;15, 2008.&#160; We do not believe the adoption of SFAS 141
will have a material effect on our results of operations or financial position.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">During March&nbsp;2008, the FASB issued SFAS No.&nbsp;161, &#147;Disclosures
about Derivative Instruments and Hedging Activities&#148; (SFAS No.&nbsp;161).&#160; SFAS No.&nbsp;161 is intended to improve
financial reporting about derivative instruments and hedging activities by
requiring enhanced disclosures to enable investors to better understand their
effects on an entity&#146;s financial position, financial performance, and cash
flows.&#160; SFAS No.&nbsp;161 also improves
transparency about the location and amounts of derivative instruments in an
entity&#146;s financial statements; how derivative instruments and related hedged
items are accounted for under Statement 133; and how derivative instruments and
related hedged items affect its financial position, financial performance, and
cash flows.&#160; SFAS No.&nbsp;161 is
effective for financial statements issued for fiscal years and interim periods
beginning after November&nbsp;15, 2008, with early application encouraged.&#160; We do not believe the adoption of SFAS 161
will have a material effect on our results of operations or financial position.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">3.</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><u><font size="2" style="font-size:10.0pt;">Critical Accounting Policies</font></u></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">A summary of our critical accounting policies
and estimates are as follows:</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;letter-spacing:-.1pt;">Principles of consolidation:</font></b><font size="2" style="font-size:10.0pt;letter-spacing:-.1pt;">&#160; The consolidated financial
statements include the accounts of Appliance Recycling Centers of America,&nbsp;Inc.
and our subsidiaries.&#160; All significant
intercompany accounts and transactions have been eliminated in consolidation.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">During the second quarter of 2003, we became a majority (60%) owner in
North America Appliance Company, LLC (NAACO).&#160;
NAACO was formed and commenced operations in June&nbsp;2003 and is a
retailer of special-buy appliances in Texas.&#160;
Because NAACO has a net shareholders&#146; deficit, no minority interest has
been recognized on our consolidated balance sheet, and 100% of NAACO&#146;s
operations are included in our consolidated financial statements.</font></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">7</font></p>

<div style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- SEQ.=1,FOLIO='7',FILE='C:\JMS\pselva\08-11369-1\task2935225\11369-1-ba-03.htm',USER='105344',CD='May 13 06:06 2008' -->


<br clear="all" style="page-break-before:always;">


<div style="font-family:Times New Roman;">

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">On September&nbsp;1, 2006, we became a majority (60%) owner in
Productos Duraderos de Norte America (PDN), a Mexican corporation in exchange
for $3,000 in cash.&#160; PDN refurbishes
household window air conditioners for sale through our NAACO operation in
McAllen, Texas and through our ApplianceSmart outlet stores. PDN has operated
at a loss since September&nbsp;1, 2006 and therefore 100% of PDN&#146;s operations
are included in our consolidated financial statements.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">During the third quarter of 2006, ARCA Canada, Incorporated was formed
in Canada.&#160; ARCA Canada is a wholly owned
(100%) subsidiary of ARCA Inc. and its operating results are included in our
consolidated financial statements.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;letter-spacing:-.1pt;">Revenue recognition:</font></b><font size="2" style="font-size:10.0pt;letter-spacing:-.1pt;">&#160; We recognize revenue from
appliance sales in the period the consumer purchases and pays for the
appliances, net of an allowance for estimated returns.&#160; We recognize revenue from appliance recycling
when we collect and process a unit.&#160; We
recognize byproduct revenue upon shipment.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">We recognize revenue on extended warranties with retained service
obligations on a straight-line basis over the period of the warranty in
accordance with FASB Technical Bulletin 90-1, &#147;Accounting for Separately Priced
Extended Warranty and Product Maintenance Contracts.&#148;</font><font size="2" style="font-size:10.0pt;letter-spacing:-.1pt;">&#160; On extended warranty
arrangements we sell but others service for a fixed portion of the warranty
sales price, we recognize revenue for the net amount retained at the time of
sale of the extended warranty to the consumer.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:-.1pt;">We include shipping and handling charges to
customers in revenues, which are recognized in the period the consumer
purchases and pays for the delivery. Shipping and handling costs that we incur
are included in cost of revenues.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;letter-spacing:-.1pt;">Taxes collected from
customers:&#160; </font></b><font size="2" style="font-size:10.0pt;">In June&nbsp;2006,
the Financial Accounting Standards Board (FASB) ratified the consensus of
Emerging Issues Task Force Issue No.&nbsp;06-3, &#147;How Taxes Collected from
Customers and Remitted to Governmental Authorities Should Be Presented in the
Income Statement (That Is, Gross versus Net Presentation)&#148; (EITF 06-3).&nbsp;
EITF 06-3 concluded that the presentation of taxes imposed on revenue-producing
transactions (sales, use, value added&nbsp;and excise taxes) on either a gross
(included in revenues and costs) or a net (excluded from revenues) basis is an
accounting policy that should be disclosed.&nbsp; We adopted EITF 06-3 during
the year ended December&nbsp;29, 2007, and it did not have any impact on our
results of operations or financial position.&nbsp; Our policy is to present
taxes imposed on revenue-producing transactions on a net basis.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;letter-spacing:-.1pt;">Accounting for Leases:</font></b><font size="2" style="font-size:10.0pt;letter-spacing:-.1pt;">&#160; We conduct the majority of our
retail and recycling operations from leased facilities.&#160; The leases require payment of real estate
taxes, insurance and common area maintenance, in addition to rent.&#160; The terms of our lease agreements typically
range from 5 to 10 years.&#160; Most of the leases
contain renewal clauses and escalation clauses, and certain store leases
require contingent rents based on factors such as revenue.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 35.05pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:-.1pt;">For leases that contain predetermined fixed
escalations of the minimum rent, we recognize the related rent expense on a
straight-line basis from the date we take possession of the property to the end
of the initial lease term.&#160; We record any
difference between straight-line rent amounts and amounts payable under the
leases as part of deferred rent, in accrued liabilities.</font></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">8</font></p>

<div style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- SEQ.=1,FOLIO='8',FILE='C:\JMS\pselva\08-11369-1\task2935225\11369-1-ba-03.htm',USER='105344',CD='May 13 06:06 2008' -->


<br clear="all" style="page-break-before:always;">


<div style="font-family:Times New Roman;">

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:-.1pt;">Cash or lease incentives (&#147;tenant allowances&#148;)
received upon entering into certain store leases are recognized on a
straight-line basis as a reduction to rent from the date we take possession of
the property through the end of the initial lease term.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;letter-spacing:-.1pt;">Product warranty:</font></b><font size="2" style="font-size:10.0pt;letter-spacing:-.1pt;">&#160; We provide a warranty for the
replacement or repair of certain defective units.&#160; Our standard warranty policy requires us to
repair or replace certain defective units at no cost to our customers.&#160; We estimate the costs that may be incurred
under our warranty and record a liability reserve in the amount of such costs
at the time we recognize product revenue.&#160;
Factors that affect our warranty liability reserve for covered units
include the number of units sold, historical and anticipated rates of warranty
claims on these units, and the cost of such claims. We periodically assess the
adequacy of our recorded warranty liability reserve and adjust the amounts as
necessary.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:-.1pt;">Changes in our warranty liability reserve are as
follows for the three months ended:</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<table border="0" cellspacing="0" cellpadding="0" width="70%" style="border-collapse:collapse;margin-left:.5in;width:70.0%;">
 <tr>
  <td width="57%" valign="bottom" style="padding:0in 0in 0in 0in;width:57.12%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in 0in 0in 0in;width:3.58%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="17%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:17.16%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">March&nbsp;29,<br>
  2008</font></b></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in 0in 0in 0in;width:3.58%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="17%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:17.16%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">March&nbsp;31,<br>
  2007</font></b></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.4%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
 </tr>
 <tr>
  <td width="57%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:57.12%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Balance, beginning</font></p>
  </td>
  <td width="3%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:3.58%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:1.58%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="15%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-top:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:15.58%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">80,000</font></p>
  </td>
  <td width="3%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:3.58%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:1.58%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="15%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-top:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:15.58%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">28,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.4%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="57%" valign="top" style="padding:0in 0in 0in 0in;width:57.12%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Standard accrual based on units sold</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in 0in 0in 0in;width:3.58%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="17%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:17.16%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">26,000</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in 0in 0in 0in;width:3.58%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="17%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:17.16%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4,000</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.4%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="57%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:57.12%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Actual costs incurred</font></p>
  </td>
  <td width="3%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:3.58%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="17%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:17.16%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(1,000</font></p>
  </td>
  <td width="3%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:3.58%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>
  </td>
  <td width="17%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:17.16%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(1,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.4%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>
  </td>
 </tr>
 <tr>
  <td width="57%" valign="top" style="padding:0in 0in 0in 0in;width:57.12%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Periodic accrual adjustments</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in 0in 0in 0in;width:3.58%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="17%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:17.16%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(18,000</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in 0in 0.375pt 0in;width:3.58%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>
  </td>
  <td width="17%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:17.16%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(26,000</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0.375pt 0in;width:1.4%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>
  </td>
 </tr>
 <tr>
  <td width="57%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:57.12%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Balance, ending</font></p>
  </td>
  <td width="3%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:3.58%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.58%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="15%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border-bottom:double windowtext 1.5pt;border-left:none;border-right:none;border-top:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:15.58%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">87,000</font></p>
  </td>
  <td width="3%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:3.58%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.58%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="15%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border-bottom:double windowtext 1.5pt;border-left:none;border-right:none;border-top:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:15.56%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">5,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.4%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
</table>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;letter-spacing:-.1pt;">Trade receivables:&#160; </font></b><font size="2" style="font-size:10.0pt;letter-spacing:-.1pt;">We
carry trade receivables at original invoice amount less an estimate made for
doubtful receivables based on a monthly review of all outstanding amounts.&#160; Management determines the allowance for
doubtful accounts by regularly evaluating individual customer receivables and
considering a customer&#146;s financial condition, credit history and current
economic conditions.&#160; We write off trade
receivables when we deem them uncollectible.&#160;
We record recoveries of trade receivables previously written off when we
receive them.&#160; We consider a trade
receivable to be past due if any portion of the receivable balance is
outstanding for more than 90 days.&#160; We do
not charge interest on past due receivables.&#160;
Our management considers the reserve for doubtful accounts of $170,000
and $152,000 to be adequate to cover any exposure to loss as of March&nbsp;29,
2008 and December&nbsp;29, 2007, respectively.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;letter-spacing:-.1pt;">Cash:</font></b><font size="2" style="font-size:10.0pt;letter-spacing:-.1pt;">&#160; We maintain our cash in bank
deposit and money-market accounts which, at times, exceed federally insured
limits.&#160; We have not experienced any
losses in such accounts.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;letter-spacing:-.1pt;">Inventories:</font></b><font size="2" style="font-size:10.0pt;letter-spacing:-.1pt;">&#160; Inventories, consisting
principally of appliances, are stated at the lower of cost, first-in, first-out
(FIFO), or market and consist of:</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<table border="0" cellspacing="0" cellpadding="0" width="70%" style="border-collapse:collapse;margin-left:.5in;width:70.0%;">
 <tr>
  <td width="57%" valign="bottom" style="padding:0in 0in 0in 0in;width:57.12%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in 0in 0in 0in;width:3.58%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="17%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:17.16%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">March&nbsp;29,<br>
  2008</font></b></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in 0in 0in 0in;width:3.58%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="17%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:17.16%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">December&nbsp;29,<br>
  2007</font></b></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.4%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
 </tr>
 <tr>
  <td width="57%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:57.12%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Finished goods</font></p>
  </td>
  <td width="3%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:3.58%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:1.58%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="15%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-top:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:15.58%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">14,832,000</font></p>
  </td>
  <td width="3%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:3.58%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:1.58%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="15%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-top:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:15.58%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">14,148,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.4%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="57%" valign="top" style="padding:0in 0in 0in 0in;width:57.12%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Less reserves</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in 0in 0in 0in;width:3.58%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="17%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:17.16%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(61,000</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in 0in 0.375pt 0in;width:3.58%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>
  </td>
  <td width="17%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:17.16%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(84,000</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0.375pt 0in;width:1.4%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>
  </td>
 </tr>
 <tr>
  <td width="57%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:57.12%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="3%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:3.58%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.58%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="15%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border-bottom:double windowtext 1.5pt;border-left:none;border-right:none;border-top:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:15.58%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">14,771,000</font></p>
  </td>
  <td width="3%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:3.58%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.58%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="15%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border-bottom:double windowtext 1.5pt;border-left:none;border-right:none;border-top:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:15.56%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">14,064,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.4%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
</table>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">9</font></p>

<div style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- SEQ.=1,FOLIO='9',FILE='C:\JMS\pselva\08-11369-1\task2935225\11369-1-ba-03.htm',USER='105344',CD='May 13 06:06 2008' -->


<br clear="all" style="page-break-before:always;">


<div style="font-family:Times New Roman;">

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:-.1pt;">We provide estimated reserves for the
realizability of our appliance inventories, including adjustments to market,
based on various factors including the age of such inventory and our management&#146;s
assessment of the need for such allowances.&#160;
We look at historical inventory agings and margin analysis in
determining our reserve estimate.&#160; We
believe the reserve of $61,000 and $84,000 is adequate as of March&nbsp;29,
2008 and December&nbsp;29, 2007, respectively.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;letter-spacing:-.1pt;">Property and equipment:</font></b><font size="2" style="font-size:10.0pt;letter-spacing:-.1pt;">&#160; We compute depreciation using
straight-line and accelerated methods over the following estimated useful
lives:</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<table border="0" cellspacing="0" cellpadding="0" width="50%" style="border-collapse:collapse;margin-left:.5in;width:50.0%;">
 <tr>
  <td width="68%" valign="bottom" style="padding:0in 0in 0in 0in;width:68.98%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="5%" valign="bottom" style="padding:0in 0in 0in 0in;width:5.0%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="24%" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:24.0%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">Years</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.02%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
 </tr>
 <tr>
  <td width="68%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:68.98%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Buildings and improvements</font></p>
  </td>
  <td width="5%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:5.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="24%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:24.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">18 &#150; 30</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.02%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="68%" valign="top" style="padding:0in 0in 0in 0in;width:68.98%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Equipment</font></p>
  </td>
  <td width="5%" valign="bottom" style="padding:0in 0in 0in 0in;width:5.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="24%" valign="bottom" style="padding:0in 0in 0in 0in;width:24.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">3 &#150; 8</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.02%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
</table>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:-.1pt;">We amortize leasehold improvements on a
straight-line basis over the shorter of their estimated useful lives or the
underlying lease term.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;letter-spacing:-.1pt;">Software development costs:</font></b><font size="2" style="font-size:10.0pt;letter-spacing:-.1pt;">&#160; We capitalize software developed
for internal use in accordance with Statement of Position 98-1 and are
amortizing such costs over their estimated useful life of three to five years.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;letter-spacing:-.1pt;">Accounting for long-lived
assets:&#160; </font></b><font size="2" style="font-size:10.0pt;letter-spacing:-.1pt;">We
evaluate long-lived assets such as property and equipment for impairment
whenever events or changes in circumstances indicate the carrying value of an
asset may not be recoverable.&#160; We assess
impairment based on the estimated future net undiscounted cash flows expected
to result from the use of the assets, including cash flows from
disposition.&#160; Should the sum of the
expected future net cash flows be less than the carrying value, we recognize an
impairment loss at that time.&#160; We measure
an impairment loss by comparing the amount by which the carrying value exceeds
the fair value (estimated discounted future cash flows or appraisal of assets)
of the long-lived assets.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Deferred financing fees:</font></b><font size="2" style="font-size:10.0pt;">&#160; Deferred financing fees are presented in the
consolidated balance sheet as a component of other assets and are reported net
of accumulated amortization.&#160; We record
amortization expense on a straight-line basis over the term of the underlying
debt.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 24.75pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;letter-spacing:-.1pt;">Income taxes:</font></b><font size="2" style="font-size:10.0pt;letter-spacing:-.1pt;">&#160; Deferred taxes are provided on
an asset and liability method whereby deferred tax assets are recognized for
deductible temporary differences and operating loss and tax credit
carryforwards, and deferred tax liabilities are recognized for taxable
temporary differences.&#160; Temporary
differences are the differences between the reported amounts of assets and
liabilities and their tax basis.&#160;
Deferred tax assets are reduced by a valuation allowance when, in the
opinion of our management, it is more likely than not that some portion or all
of the deferred tax assets will not be realized.&#160; Deferred tax assets and liabilities are
adjusted for the effects of changes in tax laws and rates on the date of
enactment.&#160; Realization of deferred tax
assets is dependent upon sufficient future taxable income during the periods
when deductible temporary differences and carryforwards are expected to be
available to reduce taxable income.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;text-align:left;text-indent:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Stock-based
compensation:</font></b><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160; </font><font size="2" face="Times New Roman" style="font-size:10.0pt;">We use the Black-Scholes option pricing model to
determine the fair value of awards at the grant date.&#160; We calculate the expected volatility for
stock</font></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">10</font></p>

<div style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- SEQ.=1,FOLIO='10',FILE='C:\JMS\pselva\08-11369-1\task2935225\11369-1-ba-03.htm',USER='105344',CD='May 13 06:06 2008' -->


<br clear="all" style="page-break-before:always;">


<div style="font-family:Times New Roman;">

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;text-align:left;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">options and
awards using historical volatility.&#160; We
estimate a 5% forfeiture rate for stock options but will continue to review
this estimate in future periods.&#160; The
risk-free rates for the expected terms of the stock options is based on the U.S.
Treasury yield curve in effect at the time of the grant.&#160; Based on these valuations, we recognized
stock-based compensation expense of $78,000 and $11,000 for the three months
ended March&nbsp;29, 2008 and March&nbsp;31, 2007, respectively. We estimate
that the expense for the remainder of fiscal 2008 will be approximately
$411,000,&#160; based on the value of options
outstanding as of March&nbsp;29, 2008.&#160;
This estimate does not include any expense for additional options that
may be granted and vest during 2008.</font></p>

<p align="left" style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;text-align:left;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;letter-spacing:-.1pt;">Comprehensive income:&#160; </font></b><font size="2" style="font-size:10.0pt;letter-spacing:-.1pt;">The
components of comprehensive income include net income and the effects of
foreign currency translation adjustments.&#160;
The net of tax effect of the foreign currency translation adjustment was
($25,000) for the three months ended March&nbsp;29, 2008 and was not
significant for the three months ended March&nbsp;31, 2007.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;letter-spacing:-.1pt;">Segment information:&#160;&#160; </font></b><font size="2" style="font-size:10.0pt;letter-spacing:-.1pt;">A<b>  </b>business segment is a distinguishable component of an
enterprise that is engaged in providing an individual product or service or a
group of related products or services and that is subject to risks and returns
that are different for those of other business segments.<b>&#160; </b>We operate two reportable segments:&#160;
Retail and Recycling.&#160; The retail
operation is comprised of sales generated through our ApplianceSmart factory
outlet stores.&#160; The recycling operation
is comprised of all fees charged for collecting, recycling and installing
appliances for utilities and other customers.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;letter-spacing:-.1pt;">Estimates:</font></b><font size="2" style="font-size:10.0pt;letter-spacing:-.1pt;">&#160; The preparation of financial
statements in conformity with accounting principles generally accepted in the
United States of America requires our management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period.&#160; Significant items
subject to estimates and assumptions include the valuation allowances for
accounts receivable, inventories and deferred tax assets, accrued expenses, and
the assumptions we use to value stock-based compensation.&#160; Actual results could differ from those
estimates.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 24.75pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4.</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><u><font size="2" style="font-size:10.0pt;">Accrued
Expenses</font></u></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Accrued expenses were as follows:</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<table border="0" cellspacing="0" cellpadding="0" width="66%" style="border-collapse:collapse;margin-left:.5in;width:66.68%;">
 <tr>
  <td width="55%" valign="bottom" style="padding:0in 0in 0in 0in;width:55.04%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in 0in 0in 0in;width:3.74%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="18%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:18.02%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">March&nbsp;29,&nbsp;2008</font></b></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in 0in 0in 0in;width:3.74%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="18%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:18.02%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">December&nbsp;29,<br>
  2007</font></b></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.44%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
 </tr>
 <tr>
  <td width="55%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:55.04%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Compensation and benefits</font></p>
  </td>
  <td width="3%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:3.74%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:1.66%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="16%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-top:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:16.36%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">1,300,000</font></p>
  </td>
  <td width="3%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:3.74%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:1.66%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="16%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-top:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:16.36%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2,113,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.44%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="55%" valign="top" style="padding:0in 0in 0in 0in;width:55.04%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Warranty expense</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in 0in 0in 0in;width:3.74%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="18%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:18.02%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">87,000</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in 0in 0in 0in;width:3.74%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="18%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:18.02%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">80,000</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.44%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="55%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:55.04%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Accrued recycling</font></p>
  </td>
  <td width="3%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:3.74%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="18%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:18.02%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="3%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:3.74%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="18%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:18.02%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.44%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="55%" valign="top" style="padding:0in 0in 0in 0in;width:55.04%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Incentive checks</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in 0in 0in 0in;width:3.74%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="18%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:18.02%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">1,110,000</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in 0in 0in 0in;width:3.74%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="18%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:18.02%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">1,110,000</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.44%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="55%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:55.04%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Accrued rent</font></p>
  </td>
  <td width="3%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:3.74%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="18%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:18.02%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">311,000</font></p>
  </td>
  <td width="3%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:3.74%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="18%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:18.02%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">433,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.44%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="55%" valign="top" style="padding:0in 0in 0in 0in;width:55.04%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Accrued payables</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in 0in 0in 0in;width:3.74%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="18%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:18.02%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">282,000</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in 0in 0in 0in;width:3.74%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="18%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:18.02%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">190,000</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.44%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="55%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:55.04%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Other</font></p>
  </td>
  <td width="3%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:3.74%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="18%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:18.02%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">293,000</font></p>
  </td>
  <td width="3%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:3.74%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="18%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:18.02%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">187,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.44%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="55%" valign="top" style="padding:0in 0in 0in 0in;width:55.04%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in 0in 0in 0in;width:3.74%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.66%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="16%" valign="bottom" style="border-bottom:double windowtext 1.5pt;border-left:none;border-right:none;border-top:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:16.36%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">3,383,000</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in 0in 0in 0in;width:3.74%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.66%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="16%" valign="bottom" style="border-bottom:double windowtext 1.5pt;border-left:none;border-right:none;border-top:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:16.36%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4,113,000</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.44%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
</table>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">11</font></p>

<div style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- SEQ.=1,FOLIO='11',FILE='C:\JMS\pselva\08-11369-1\task2935225\11369-1-ba-03.htm',USER='105344',CD='May 13 06:06 2008' -->


<br clear="all" style="page-break-before:always;">


<div style="font-family:Times New Roman;">

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">5.</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><u><font size="2" style="font-size:10.0pt;">Basic and Diluted Net Income
per Share</font></u></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:-.1pt;">Basic per-share amounts are computed, generally,
by dividing net income (loss) by the weighted-average number of common shares
outstanding.&#160; Diluted per-share amounts
assume the conversion, exercise or issuance of all potential common stock
instruments unless their effect is antidilutive, thereby reducing the loss or
increasing the income per common share.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:-.1pt;">In arriving at diluted weighted-average shares and
per-share amounts, we included options with exercise prices below average
market prices, for the respective fiscal periods in which they were dilutive,
using the treasury stock method.&#160; We
calculated the number of additional shares by assuming the outstanding stock
options and warrants were exercised and that the proceeds from such exercises
were used to acquire common stock at the average market price during the
period.&#160; Because of the loss incurred
during the three month period ended March&nbsp;31, 2007, the effect of options
on 2007 is antidilutive and, they were not therefore included in the
computation of per-share amounts.&#160; The
effect of all options in the first quarter of 2008 is dilutive.&#160; A reconciliation of the denominator in the
basic and diluted income or loss per share is as follows:</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:-.1pt;">&nbsp;</font></p>

<table border="0" cellspacing="0" cellpadding="0" width="93%" style="border-collapse:collapse;margin-left:.5in;width:93.34%;">
 <tr>
  <td width="67%" valign="bottom" style="padding:0in 0in 0in 0in;width:67.9%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.68%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.86%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">March&nbsp;29,</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.68%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.86%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">March&nbsp;31,</font></b></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.02%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
 </tr>
 <tr>
  <td width="67%" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:67.9%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">(In&nbsp;thousands,&nbsp;except&nbsp;per&nbsp;share&nbsp;data)</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.68%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.86%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">2008</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.68%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.86%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">2007</font></b></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.02%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
 </tr>
 <tr>
  <td width="67%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:67.9%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Numerator:</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:12.86%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:12.86%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.02%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="67%" valign="top" style="padding:0in 0in 0in 0in;width:67.9%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Net Income (Loss)</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:1.2%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="11%" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:11.66%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">117</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:1.2%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="11%" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:11.66%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(472</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0.375pt 0in;width:1.02%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>
  </td>
 </tr>
 <tr>
  <td width="67%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:67.9%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Denominator:</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:12.86%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:12.86%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.02%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="67%" valign="top" style="padding:0in 0in 0in 0in;width:67.9%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Denominator for basic earnings (loss) per share, weighted average
  shares</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.86%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4,556</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.86%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4,341</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.02%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="67%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:67.9%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Dilutive potential shares - employee stock options</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.86%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">68</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.86%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#151;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.02%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="67%" valign="top" style="padding:0in 0in 0in 0in;width:67.9%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Denominator for diluted earnings (loss) per share, weighted average
  shares</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.86%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4,624</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.86%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4,341</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.02%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="67%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:67.9%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Net income (loss) per share - basic</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:1.2%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="11%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-top:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:11.66%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">0.03</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:1.2%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="11%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-top:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:11.66%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(0.11</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.02%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>
  </td>
 </tr>
 <tr>
  <td width="67%" valign="top" style="padding:0in 0in 0in 0in;width:67.9%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Net income (loss) per share - diluted</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:1.2%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="11%" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:11.66%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">0.03</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:1.2%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="11%" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:11.66%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(0.11</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 1pt 0in;width:1.02%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>
  </td>
 </tr>
</table>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">12</font></p>

<div style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- SEQ.=1,FOLIO='12',FILE='C:\JMS\pselva\08-11369-1\task2935225\11369-1-ba-03.htm',USER='105344',CD='May 13 06:06 2008' -->


<br clear="all" style="page-break-before:always;">


<div style="font-family:Times New Roman;">

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:-.1pt;">6.</font><font size="1" style="font-size:3.0pt;letter-spacing:-.1pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><b><font size="2" style="font-size:10.0pt;font-weight:bold;letter-spacing:-.1pt;">Line of Credit</font></b></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">At March&nbsp;29, 2008, we had a $18 million line of credit with a
lender.&#160; The interest rate on the line as
of March&nbsp;29, 2008 was prime plus 2 percentage points (7.25%).&#160; The amount of borrowings available under the
line of credit is based on a formula using receivables and inventories.&#160; Our unused borrowing capacity under this line
was $827,000 at March&nbsp;29, 2008.&#160; The
line of credit has a stated maturity date of December&nbsp;31, 2010, if not
renewed, and provides that the lender may demand payment in full of the entire
outstanding balance of the loan at any time.&#160;
The line of credit is collateralized by substantially all our assets and
requires minimum monthly interest payments of $58,000, regardless of the
outstanding principal balance.&#160; The
lender is also secured by an inventory repurchase agreement with Whirlpool
Corporation for purchases from Whirlpool only.&#160;
The loan requires that we meet certain financial covenants, provides
payment penalties for noncompliance and prepayment, limits the amount of other
debt we can incur, limits the amount of spending on fixed assets, and prohibits
payments of dividends.&#160; At March&nbsp;29,
2008, we were in compliance with the terms of the loan agreement.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 24.95pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;letter-spacing:-.1pt;">7.</font></b><b><font size="1" style="font-size:8.5pt;font-weight:bold;letter-spacing:-.1pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font></b><b><font size="2" style="font-size:10.0pt;font-weight:bold;letter-spacing:-.1pt;">Long-Term Obligations</font></b></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:-.1pt;">Long-term debt and capital lease obligations
consisted of the following:</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<table border="0" cellspacing="0" cellpadding="0" width="93%" style="border-collapse:collapse;margin-left:.5in;width:93.34%;">
 <tr>
  <td width="67%" valign="bottom" style="padding:0in 0in 0in 0in;width:67.9%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.68%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.86%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">March&nbsp;29,<br>
  2008</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.68%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.86%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">December&nbsp;29,<br>
  2007</font></b></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.02%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
 </tr>
 <tr>
  <td width="67%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:67.9%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Adjustable rate mortgage adjusted annually each September based on 30
  day LIBOR plus 2.7 percentage points (7.62% as of March&nbsp;29, 2008) on a
  20-year amortization due October&nbsp;2012, collateralized by land and
  building.</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:1.2%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="11%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-top:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:11.66%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2,878,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:1.2%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="11%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-top:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:11.66%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2,902,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.02%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="67%" valign="top" style="padding:0in 0in 0in 0in;width:67.9%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.86%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.86%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.02%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="67%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:67.9%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">6.85% mortgage, due in monthly installments of $15,326, including
  interest, due January&nbsp;2013, collateralized by land and building</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.86%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">1,710,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.86%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">1,721,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.02%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="67%" valign="top" style="padding:0in 0in 0in 0in;width:67.9%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.86%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.86%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.02%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="67%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:67.9%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Other (primarily capital leases)</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.86%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">926,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.86%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">812,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.02%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="67%" valign="top" style="padding:0in 0in 0in 0in;width:67.9%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:12.86%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">5,514,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:12.86%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">5,435,000</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.02%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="67%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:67.9%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Less current maturities</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.86%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">530,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.86%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">479,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.02%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="67%" valign="top" style="padding:0in 0in 0in 0in;width:67.9%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.2%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="11%" valign="bottom" style="border-bottom:double windowtext 1.5pt;border-left:none;border-right:none;border-top:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:11.66%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4,984,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.2%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="11%" valign="bottom" style="border-bottom:double windowtext 1.5pt;border-left:none;border-right:none;border-top:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:11.66%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4,956,000</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.02%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
</table>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 2.0in;text-indent:-2.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">8.</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><u><font size="2" style="font-size:10.0pt;">Commitments and
Contingencies</font></u></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 2.0in;text-indent:-2.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Contracts:</font></b><font size="2" style="font-size:10.0pt;">&#160; We have entered into contracts with three of
our appliance vendors.&#160; Under the
agreements there are no minimum purchase commitments; however, we have agreed
to indemnify the vendors for certain claims, allegations or losses with respect
to appliances we sell.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 27.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Litigation:&#160; </font></b><font size="2" style="font-size:10.0pt;">In December&nbsp;2004,
we filed suit in the U.S. District Court for the Central District of California
alleging that JACO Environmental,&nbsp;Inc., (JACO) and one of our former
consultants fraudulently obtained U.S. Patent No.&nbsp;6,732,416 in May&nbsp;2004
covering appliance recycling methods and systems which were originally
developed by us beginning in 1987 and used in serving more than</font></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">13</font></p>

<div style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- SEQ.=1,FOLIO='13',FILE='C:\JMS\pselva\08-11369-1\task2935225\11369-1-ba-03.htm',USER='105344',CD='May 13 06:06 2008' -->


<br clear="all" style="page-break-before:always;">


<div style="font-family:Times New Roman;">

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">forty-five
electric utility appliance recycling programs since that time.&#160; We are seeking an injunction to prevent JACO
from claiming that it obtained a valid patent on appliance recycling processes
that we believe is based on methods and processes we invented. In addition, we
are seeking a finding by the Court that the patent obtained by JACO is
unenforceable due to inequitable conduct before the United States Patent
Office.&#160; We are also asking the court for
unspecified damages related to charges that JACO, in using the patent to
promote its services, has engaged in unfair competition and false and
misleading advertising under federal and California statutes.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 27.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">In
September&nbsp;2005, we received a legally binding document in which JACO
states it will not sue us or any of our customers for violating the JACO
patent. Further, the defendants in the case have not asserted any counterclaims
against ARCA. Therefore, our recycling operations will continue with our
current contracts and future customers without interruption.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The
case is scheduled for trial in November&nbsp;of 2008. The trial is expected to
last approximately two weeks.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="color:black;letter-spacing:0pt;line-height:normal;margin:0in 0in .0001pt .5in;text-autospace:ideograph-numeric ideograph-other;"><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;">On
October&nbsp;24, 2006, JACO and SEG Umwelt-Service/Basis of Mettlach, Germany
(SEG) filed a patent infringement lawsuit in Federal Court in San Francisco
against us.&#160; The suit claimed that we
have been using refrigerator recycling systems and processes covered by two
U.S. patents issued to SEG and exclusively licensed to JACO.&#160; JACO and SEG sought an undisclosed amount in
damages, in addition to an injunction barring us from continuing to use and
market the systems and processes upon which we allegedly infringed. This suit
has been subsequently dismissed following a transfer of the case to Los Angeles
upon the motion of ARCA.</font></p>

<p style="color:black;letter-spacing:0pt;line-height:normal;margin:0in 0in .0001pt 27.0pt;text-autospace:none;"><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;letter-spacing:-.1pt;">9.</font></b><b><font size="1" style="font-size:8.5pt;font-weight:bold;letter-spacing:-.1pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font></b><b><font size="2" style="font-size:10.0pt;font-weight:bold;letter-spacing:-.1pt;">Segment Information</font></b></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:-.1pt;">We operate two
reportable segments:&#160; retail and recycling.&#160; The retail operation is comprised of sales
generated through our ApplianceSmart factory outlet stores.&#160; The recycling operation is comprised of all
fees charged for collecting, recycling and installing appliances for utilities
and other customers as well as all byproduct revenue.&#160; Our segments are evaluated on an operating
income basis, and a stand-alone tax provision is not calculated for each
segment.&#160;&#160; Certain corporate items are
not allocable to the two segments as noted in the table below.&#160;&#160; The other accounting policies of the
segments are the same as those described in Note 1, <i>Nature of
Business and Significant Accounting Policies </i>of our Annual Report on
Form&nbsp;10-K for the year ended December&nbsp;29, 2007<i>.</i>&#160; The information for 2007 has been labeled restated
to reflect the inclusion of the comparable quarterly period, which was omitted
from prior filings, in the current year report.</font></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">14</font></p>

<div style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- SEQ.=1,FOLIO='14',FILE='C:\JMS\pselva\08-11369-1\task2935225\11369-1-ba-03.htm',USER='105344',CD='May 13 06:06 2008' -->


<br clear="all" style="page-break-before:always;">


<div>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:-.1pt;">The following tables
present our business segment information for continuing operations in the first
quarter of 2008 and 2007; respectively:</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;width:100.0%;">
 <tr>
  <td width="70%" valign="bottom" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="26%" colspan="5" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:26.5%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">For&nbsp;the&nbsp;Three&nbsp;Months&nbsp;Ending</font></b></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="bottom" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">March&nbsp;29,&nbsp;2008</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="border:none;border-top:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:2.5%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border-bottom:solid windowtext 1.0pt;border-left:none;border-right:none;border-top:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">March&nbsp;31,&nbsp;2007</font></b></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="bottom" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.0%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.0%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">(Restated)</font></b></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;">&nbsp;</font></b></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Revenue</font></b></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Retail</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.12%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" style="padding:0in 0in 0in 0in;width:10.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">18,962,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.12%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" style="padding:0in 0in 0in 0in;width:10.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">17,689,000</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Recycling</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">6,844,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2,243,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Total Revenue</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">25,806,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">19,932,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Operating Income (Loss)</font></b></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Retail</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.12%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" style="padding:0in 0in 0in 0in;width:10.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">1,405,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.12%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" style="padding:0in 0in 0in 0in;width:10.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">608,000</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Recycling</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">689,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">297,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Unallocated Corporate Costs</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(1,693,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0.375pt 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(1,081,000</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0.375pt 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Total Operating Income (Loss)</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.12%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" style="border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:10.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">401,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.12%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" style="border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:10.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(176,000</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0.75pt 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Assets</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Retail</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.12%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">19,335,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.12%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">16,554,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Recycling</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">8,784,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4,255,000</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Corporate assets not allocable</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2,543,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">3,038,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Total Assets</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.12%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:10.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">30,662,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.12%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:10.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">23,847,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Capital Expenditures</font></b></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Retail</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.12%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" style="padding:0in 0in 0in 0in;width:10.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">53,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.12%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" style="padding:0in 0in 0in 0in;width:10.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#151;</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Recycling</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">52,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">8,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Corporate</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">68,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">74,000</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Total Capital Expenditures</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.12%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" style="border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:10.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">173,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.12%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" style="border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:10.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">82,000</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Depreciation</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Retail</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.12%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">108,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.12%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">103,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Recycling</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">59,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">20,000</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Corporate</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">100,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">70,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Total Depreciation</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.12%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:10.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">267,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.12%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:10.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">193,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Interest Expense</font></b></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Retail</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.12%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" style="padding:0in 0in 0in 0in;width:10.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">235,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.12%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" style="padding:0in 0in 0in 0in;width:10.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">196,000</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Recycling</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">72,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">31,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Corporate</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">90,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">71,000</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="70%" valign="top" style="padding:0in 0in 0in 0in;width:70.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Total Interest Expense</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.12%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" style="border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:10.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">397,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.5%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.12%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" style="border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:10.88%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">298,000</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
</table>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">15</font></p>

<div style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- SEQ.=1,FOLIO='15',FILE='C:\JMS\pselva\08-11369-1\task2935225\11369-1-ba-03.htm',USER='105344',CD='May 13 06:06 2008' -->



<br clear="all" style="page-break-before:always;">
<div style="font-family:Times New Roman;">

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 37.5pt;text-indent:-19.5pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;letter-spacing:0pt;">10.</font></b><b><font size="1" style="font-size:3.0pt;font-weight:bold;letter-spacing:0pt;">&#160;&#160;&#160;&#160;&#160; </font></b><b><font size="2" style="font-size:10.0pt;font-weight:bold;letter-spacing:0pt;">Income Taxes</font></b></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 37.5pt;text-indent:-19.5pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p style="letter-spacing:0pt;line-height:normal;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">As a result of losses incurred by ARCA,&nbsp;Inc.&#146;s
wholly owned subsidiary, ARCA Canada,&nbsp;Inc., we booked a tax benefit in the
first quarter of 2008.&#160; This benefit was
calculated using an estimated tax rate (ETR) of 40% which approximates the
effective tax rate incurred by ARCA Canada in 2007.</font></p>

<p style="letter-spacing:0pt;line-height:normal;margin:0in 0in .0001pt 41.75pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .25in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;letter-spacing:0pt;">11.</font></b><b><font size="1" style="font-size:3.0pt;font-weight:bold;letter-spacing:0pt;">&#160;&#160;&#160;&#160;&#160; </font></b><b><font size="2" style="font-size:10.0pt;font-weight:bold;letter-spacing:0pt;">Shareholders Equity</font></b></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .25in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;letter-spacing:0pt;">Stock options:</font></b><font size="2" style="font-size:10.0pt;letter-spacing:0pt;">&#160; Our 2006 Stock Option Plan (the
&#147;2006 Plan&#148;) permits the granting of &#147;incentive stock options&#148; meeting the
requirements of Section&nbsp;422 of the Internal Revenue Code of 1986, as
amended, and nonqualified options that do not meet the requirements of
Section&nbsp;422.&#160; The 2006 Plan has
600,000 shares available for grant. As of March&nbsp;29, 2008, 272,500 options
had been granted to employees and non-employee directors under the 2006 Plan.
Our Restated 1997 Stock Option Plan (the &#147;1997 Plan&#148; and collectively with the
2006 Plan, the &#147;Plans&#148;), has expired.&#160; As
of March&nbsp;29, 2008, options to purchase an aggregate of 25,000 shares had
been granted to employees and were outstanding under the 1997 Plan, and options
to purchase an aggregate of 27,500 shares had been granted to the Company&#146;s
non-employee directors.&#160; Under the 1997
Plan, 420,750 options have been exercised.&#160;
Options outstanding under the expired 1997 Plan continue to be exercisable
in accordance with their terms.&#160; Options
granted to employees typically vest over two years while grants to non-employee
directors vest in six months.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">The fair value of each option grant is estimated on
the date of grant using the Black-Scholes option pricing model with the
following weighted-average assumptions:</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 35.3pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<table border="0" cellspacing="0" cellpadding="0" width="60%" style="border-collapse:collapse;margin-left:.5in;width:60.0%;">
 <tr>
  <td width="74%" valign="bottom" style="padding:0in 0in 0in 0in;width:74.16%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;letter-spacing:0pt;">&nbsp;</font></b></p>
  </td>
  <td width="4%" valign="bottom" style="padding:0in 0in 0in 0in;width:4.18%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;letter-spacing:0pt;">&nbsp;</font></b></p>
  </td>
  <td width="20%" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:20.0%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;letter-spacing:0pt;">2008</font></b></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.66%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;letter-spacing:0pt;">&nbsp;</font></b></p>
  </td>
 </tr>
 <tr>
  <td width="74%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:74.16%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">Expected dividend yield</font></p>
  </td>
  <td width="4%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:4.18%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="20%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:20.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&#151;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.66%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="74%" valign="top" style="padding:0in 0in 0in 0in;width:74.16%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">Expected stock price volatility</font></p>
  </td>
  <td width="4%" valign="bottom" style="padding:0in 0in 0in 0in;width:4.18%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="20%" valign="bottom" style="padding:0in 0in 0in 0in;width:20.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">105.20</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.66%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">%</font></p>
  </td>
 </tr>
 <tr>
  <td width="74%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:74.16%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">Risk-free interest rate</font></p>
  </td>
  <td width="4%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:4.18%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="20%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:20.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">3.40</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.66%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">%</font></p>
  </td>
 </tr>
 <tr>
  <td width="74%" valign="top" style="padding:0in 0in 0in 0in;width:74.16%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">Expected life of options (years)</font></p>
  </td>
  <td width="4%" valign="bottom" style="padding:0in 0in 0in 0in;width:4.18%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="20%" valign="bottom" style="padding:0in 0in 0in 0in;width:20.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">6.75</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.66%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
 </tr>
</table>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 35.3pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">Additional information relating to all outstanding
options is as follows:</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<table border="0" cellspacing="0" cellpadding="0" width="66%" style="border-collapse:collapse;margin-left:.5in;width:66.68%;">
 <tr>
  <td width="53%" valign="bottom" style="padding:0in 0in 0in 0in;width:53.04%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;letter-spacing:0pt;">&nbsp;</font></b></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in 0in 0in 0in;width:3.74%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;letter-spacing:0pt;">&nbsp;</font></b></p>
  </td>
  <td width="18%" valign="bottom" style="padding:0in 0in 0in 0in;width:18.0%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;letter-spacing:0pt;">&nbsp;</font></b></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in 0in 0in 0in;width:3.74%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;letter-spacing:0pt;">&nbsp;</font></b></p>
  </td>
  <td width="20%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:20.06%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;letter-spacing:0pt;">Weighted&nbsp;Average</font></b></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.44%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;letter-spacing:0pt;">&nbsp;</font></b></p>
  </td>
 </tr>
 <tr>
  <td width="53%" valign="bottom" style="padding:0in 0in 0in 0in;width:53.04%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;letter-spacing:0pt;">&nbsp;</font></b></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in 0in 0in 0in;width:3.74%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;letter-spacing:0pt;">&nbsp;</font></b></p>
  </td>
  <td width="18%" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:18.0%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;letter-spacing:0pt;">Shares</font></b></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in 0in 0in 0in;width:3.74%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;letter-spacing:0pt;">&nbsp;</font></b></p>
  </td>
  <td width="20%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:20.06%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;letter-spacing:0pt;">Exercise&nbsp;Price</font></b></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.44%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;letter-spacing:0pt;">&nbsp;</font></b></p>
  </td>
 </tr>
 <tr>
  <td width="53%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:53.04%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">Outstanding at December&nbsp;29, 2007</font></p>
  </td>
  <td width="3%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:3.74%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="18%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:18.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">143,500</font></p>
  </td>
  <td width="3%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:3.74%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:1.66%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">$</font></p>
  </td>
  <td width="18%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-top:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:18.38%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">3.26</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.44%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="53%" valign="top" style="padding:0in 0in 0in 0in;width:53.04%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">Granted during the first quarter of 2008</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in 0in 0in 0in;width:3.74%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="18%" valign="bottom" style="padding:0in 0in 0in 0in;width:18.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">225,000</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in 0in 0in 0in;width:3.74%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.66%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">$</font></p>
  </td>
  <td width="18%" valign="bottom" style="padding:0in 0in 0in 0in;width:18.38%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">5.39</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.44%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="53%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:53.04%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">Exercised during the first quarter of 2008</font></p>
  </td>
  <td width="3%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:3.74%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="18%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:18.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">(58,500</font></p>
  </td>
  <td width="3%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:3.74%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">)</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.66%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">$</font></p>
  </td>
  <td width="18%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:18.38%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">3.43</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.44%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="53%" valign="top" style="padding:0in 0in 0in 0in;width:53.04%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">Cancelled</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in 0in 0in 0in;width:3.74%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="18%" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:18.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&#151;</font></p>
  </td>
  <td width="3%" valign="bottom" style="padding:0in 0in 0in 0in;width:3.74%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="20%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:20.06%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.44%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="53%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:53.04%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">Outstanding at March&nbsp;29, 2008</font></p>
  </td>
  <td width="3%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:3.74%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="18%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:18.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">310,000</font></p>
  </td>
  <td width="3%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:3.74%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.66%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">$</font></p>
  </td>
  <td width="18%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:18.38%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">4.77</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.44%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
 </tr>
</table>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">16</font></p>

<div style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- SEQ.=1,FOLIO='16',FILE='C:\JMS\pselva\08-11369-1\task2935225\11369-1-ba-05.htm',USER='105344',CD='May 13 06:07 2008' -->


<br clear="all" style="page-break-before:always;">


<div style="font-family:Times New Roman;">

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">The following tables summarize information about
stock options outstanding as of March&nbsp;29, 2008:</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">OPTIONS OUTSTANDING</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<table border="0" cellspacing="0" cellpadding="0" width="93%" style="border-collapse:collapse;margin-left:.5in;width:93.34%;">
 <tr>
  <td width="24%" valign="bottom" style="padding:0in 0in 0in 0in;width:24.24%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;letter-spacing:0pt;">&nbsp;</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.68%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;letter-spacing:0pt;">&nbsp;</font></b></p>
  </td>
  <td width="18%" valign="bottom" style="padding:0in 0in 0in 0in;width:18.0%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;letter-spacing:0pt;">&nbsp;</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.68%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;letter-spacing:0pt;">&nbsp;</font></b></p>
  </td>
  <td width="18%" valign="bottom" style="padding:0in 0in 0in 0in;width:18.0%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;letter-spacing:0pt;">Weighted&nbsp;Average</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.68%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;letter-spacing:0pt;">&nbsp;</font></b></p>
  </td>
  <td width="16%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:16.02%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;letter-spacing:0pt;">&nbsp;</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.68%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;letter-spacing:0pt;">&nbsp;</font></b></p>
  </td>
  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.78%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;letter-spacing:0pt;">Aggregate</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.24%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;letter-spacing:0pt;">&nbsp;</font></b></p>
  </td>
 </tr>
 <tr>
  <td width="24%" valign="bottom" style="padding:0in 0in 0in 0in;width:24.24%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;letter-spacing:0pt;">&nbsp;</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.68%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;letter-spacing:0pt;">&nbsp;</font></b></p>
  </td>
  <td width="18%" valign="bottom" style="padding:0in 0in 0in 0in;width:18.0%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;letter-spacing:0pt;">Number&nbsp;of&nbsp;Options</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.68%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;letter-spacing:0pt;">&nbsp;</font></b></p>
  </td>
  <td width="18%" valign="bottom" style="padding:0in 0in 0in 0in;width:18.0%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;letter-spacing:0pt;">Remaining&nbsp;Contractual</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.68%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;letter-spacing:0pt;">&nbsp;</font></b></p>
  </td>
  <td width="16%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:16.02%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;letter-spacing:0pt;">Weighted&nbsp;Average</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.68%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;letter-spacing:0pt;">&nbsp;</font></b></p>
  </td>
  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.78%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;letter-spacing:0pt;">Intrinsic</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.24%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;letter-spacing:0pt;">&nbsp;</font></b></p>
  </td>
 </tr>
 <tr>
  <td width="24%" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:24.24%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;letter-spacing:0pt;">Range&nbsp;of&nbsp;Exercise&nbsp;Prices</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.68%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;letter-spacing:0pt;">&nbsp;</font></b></p>
  </td>
  <td width="18%" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:18.0%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;letter-spacing:0pt;">Outstanding</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.68%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;letter-spacing:0pt;">&nbsp;</font></b></p>
  </td>
  <td width="18%" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:18.0%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;letter-spacing:0pt;">Life&nbsp;in&nbsp;Years</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.68%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;letter-spacing:0pt;">&nbsp;</font></b></p>
  </td>
  <td width="16%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:16.02%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;letter-spacing:0pt;">Exercise&nbsp;Price</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.68%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;letter-spacing:0pt;">&nbsp;</font></b></p>
  </td>
  <td width="10%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:10.78%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;letter-spacing:0pt;">Value</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.24%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;letter-spacing:0pt;">&nbsp;</font></b></p>
  </td>
 </tr>
 <tr>
  <td width="24%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:24.24%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">$5.05 to 5.90</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="18%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:18.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">225,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="18%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:18.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">7.13</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:1.2%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">$</font></p>
  </td>
  <td width="14%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-top:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:14.82%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">5.39</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="10%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:10.78%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.24%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="24%" valign="bottom" style="padding:0in 0in 0in 0in;width:24.24%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">$3.81 to $4.32</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="18%" valign="bottom" style="padding:0in 0in 0in 0in;width:18.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">36,500</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="18%" valign="bottom" style="padding:0in 0in 0in 0in;width:18.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">3.61</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.2%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">$</font></p>
  </td>
  <td width="14%" valign="bottom" style="padding:0in 0in 0in 0in;width:14.82%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">4.12</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.78%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.24%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="24%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:24.24%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">$2.38 to $2.80</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="18%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:18.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">41,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="18%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:18.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">5.15</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.2%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">$</font></p>
  </td>
  <td width="14%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:14.82%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">2.54</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="10%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.78%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.24%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="24%" valign="bottom" style="padding:0in 0in 0in 0in;width:24.24%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">$1.51</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="18%" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:18.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">7,500</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="18%" valign="bottom" style="padding:0in 0in 0in 0in;width:18.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">3.07</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.2%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">$</font></p>
  </td>
  <td width="14%" valign="bottom" style="padding:0in 0in 0in 0in;width:14.82%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">1.51</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.78%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.24%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="24%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:24.24%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="18%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:18.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">310,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="18%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:18.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">6.36</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.2%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">$</font></p>
  </td>
  <td width="14%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:14.82%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">4.77</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.2%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">$</font></p>
  </td>
  <td width="9%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:9.58%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">147,175</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.24%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr height="0">
  <td width="169" style="border:none;"></td>
  <td width="19" style="border:none;"></td>
  <td width="126" style="border:none;"></td>
  <td width="19" style="border:none;"></td>
  <td width="126" style="border:none;"></td>
  <td width="19" style="border:none;"></td>
  <td width="8" style="border:none;"></td>
  <td width="103" style="border:none;"></td>
  <td width="19" style="border:none;"></td>
  <td width="8" style="border:none;"></td>
  <td width="67" style="border:none;"></td>
  <td width="16" style="border:none;"></td>
 </tr>
</table>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">OPTIONS EXERCISABLE</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<table border="0" cellspacing="0" cellpadding="0" width="93%" style="border-collapse:collapse;margin-left:.5in;width:93.34%;">
 <tr>
  <td width="46%" valign="bottom" style="padding:0in 0in 0in 0in;width:46.9%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;letter-spacing:0pt;">&nbsp;</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.68%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;letter-spacing:0pt;">&nbsp;</font></b></p>
  </td>
  <td width="17%" valign="bottom" style="padding:0in 0in 0in 0in;width:17.0%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;letter-spacing:0pt;">&nbsp;</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.68%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;letter-spacing:0pt;">&nbsp;</font></b></p>
  </td>
  <td width="15%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:15.0%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;letter-spacing:0pt;">&nbsp;</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.68%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;letter-spacing:0pt;">&nbsp;</font></b></p>
  </td>
  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.66%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;letter-spacing:0pt;">Aggregate</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.4%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;letter-spacing:0pt;">&nbsp;</font></b></p>
  </td>
 </tr>
 <tr>
  <td width="46%" valign="bottom" style="padding:0in 0in 0in 0in;width:46.9%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;letter-spacing:0pt;">&nbsp;</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.68%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;letter-spacing:0pt;">&nbsp;</font></b></p>
  </td>
  <td width="17%" valign="bottom" style="padding:0in 0in 0in 0in;width:17.0%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;letter-spacing:0pt;">Number&nbsp;of&nbsp;Options</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.68%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;letter-spacing:0pt;">&nbsp;</font></b></p>
  </td>
  <td width="15%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:15.0%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;letter-spacing:0pt;">Weighted&nbsp;Average</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.68%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;letter-spacing:0pt;">&nbsp;</font></b></p>
  </td>
  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.66%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;letter-spacing:0pt;">Intrinsic</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.4%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;letter-spacing:0pt;">&nbsp;</font></b></p>
  </td>
 </tr>
 <tr>
  <td width="46%" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:46.9%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;letter-spacing:0pt;">Range&nbsp;of&nbsp;Exercise&nbsp;Prices</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.68%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;letter-spacing:0pt;">&nbsp;</font></b></p>
  </td>
  <td width="17%" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:17.0%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;letter-spacing:0pt;">Exercisable</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.68%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;letter-spacing:0pt;">&nbsp;</font></b></p>
  </td>
  <td width="15%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:15.0%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;letter-spacing:0pt;">Exercise&nbsp;Price</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.68%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;letter-spacing:0pt;">&nbsp;</font></b></p>
  </td>
  <td width="10%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:10.66%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;letter-spacing:0pt;">Value</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.4%;">
  <p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;font-weight:bold;letter-spacing:0pt;">&nbsp;</font></b></p>
  </td>
 </tr>
 <tr>
  <td width="46%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:46.9%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">$5.05 to $5.90</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="17%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:17.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">0</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:1.2%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">$</font></p>
  </td>
  <td width="13%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-top:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:13.8%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&#151;</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="10%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:10.66%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.4%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="46%" valign="top" style="padding:0in 0in 0in 0in;width:46.9%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">$3.81 to $4.32</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="17%" valign="bottom" style="padding:0in 0in 0in 0in;width:17.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">31,500</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.2%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">$</font></p>
  </td>
  <td width="13%" valign="bottom" style="padding:0in 0in 0in 0in;width:13.8%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">4.13</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.66%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.4%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="46%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:46.9%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">$2.38 to $2.80</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="17%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:17.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">28,500</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.2%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">$</font></p>
  </td>
  <td width="13%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:13.8%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">2.62</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="10%" colspan="2" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.66%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.4%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="46%" valign="top" style="padding:0in 0in 0in 0in;width:46.9%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">$1.51</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="17%" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:17.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">7,500</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.2%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">$</font></p>
  </td>
  <td width="13%" valign="bottom" style="padding:0in 0in 0in 0in;width:13.8%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">1.51</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="10%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:10.66%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.4%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="46%" valign="top" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:46.9%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="17%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:17.0%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">67,500</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.2%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">$</font></p>
  </td>
  <td width="13%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:13.8%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">3.20</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.68%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.2%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">$</font></p>
  </td>
  <td width="9%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:9.46%;">
  <p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">112,125</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#CCEEFF" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.4%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr height="0">
  <td width="327" style="border:none;"></td>
  <td width="19" style="border:none;"></td>
  <td width="119" style="border:none;"></td>
  <td width="19" style="border:none;"></td>
  <td width="8" style="border:none;"></td>
  <td width="96" style="border:none;"></td>
  <td width="19" style="border:none;"></td>
  <td width="8" style="border:none;"></td>
  <td width="66" style="border:none;"></td>
  <td width="17" style="border:none;"></td>
 </tr>
</table>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">The aggregate intrinsic value in the preceding
tables represent the total pretax intrinsic value, based on our closing stock
price of $4.86 on March&nbsp;29, 2008, which theoretically could have been
received by the option holders had all option holders exercised their options
as of that date.&#160; The total number of
in-the-money options exercisable as of March&nbsp;29, 2008 was 67,500.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 1.5in;text-indent:-1.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">PART&nbsp;I:&#160;
ITEM 2</font><font size="1" style="font-size:3.0pt;letter-spacing:0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" style="font-size:10.0pt;letter-spacing:0pt;">MANAGEMENT&#146;S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS<a name="PartiItem2ManagementsDiscussionAn_050247"></a></font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 1.5in;text-indent:-1.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;letter-spacing:0pt;">Cautionary Statement for Purposes
of &#147;Safe Harbor Provisions&#148; of the Private Securities Litigation Reform Act of
1995</font></b></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">17</font></p>

<div style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- SEQ.=1,FOLIO='17',FILE='C:\JMS\pselva\08-11369-1\task2935225\11369-1-ba-05.htm',USER='105344',CD='May 13 06:07 2008' -->


<br clear="all" style="page-break-before:always;">


<div style="font-family:Times New Roman;">

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">THIS QUARTERLY REPORT CONTAINS FORWARD-LOOKING
STATEMENTS THAT INVOLVE RISKS AND UNCERTAINTIES.&#160; THE STATEMENTS CONTAINED IN THIS QUARTERLY
REPORT THAT ARE NOT PURELY HISTORICAL ARE FORWARD-LOOKING STATEMENTS WITHIN THE
MEANING OF SECTION&nbsp;27A OF THE SECURITIES ACT OF 1933, AS AMENDED, AND
SECTION&nbsp;21E OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.&#160; THESE FORWARD-LOOKING STATEMENTS INCLUDE,
WITHOUT LIMITATION, STATEMENTS RELATING TO FUTURE ECONOMIC CONDITIONS IN
GENERAL AND STATEMENTS ABOUT OUR FUTURE:</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;text-indent:-.25in;"><font size="2" face="Symbol" style="font-size:10.0pt;letter-spacing:0pt;">&#183;</font><font size="1" style="font-size:3.0pt;letter-spacing:0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" style="font-size:10.0pt;letter-spacing:0pt;">STRATEGY
AND BUSINESS PROSPECTS;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;text-indent:-.25in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;text-indent:-.25in;"><font size="2" face="Symbol" style="font-size:10.0pt;letter-spacing:0pt;">&#183;</font><font size="1" style="font-size:3.0pt;letter-spacing:0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" style="font-size:10.0pt;letter-spacing:0pt;">DEVELOPMENT
AND EXPANSION OF SERVICES, AND THE SIZE, GROWTH, AND LEADERSHIP OF THE
POTENTIAL MARKETS FOR THESE SERVICES;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;text-indent:-.25in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;text-indent:-.25in;"><font size="2" face="Symbol" style="font-size:10.0pt;letter-spacing:0pt;">&#183;</font><font size="1" style="font-size:3.0pt;letter-spacing:0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" style="font-size:10.0pt;letter-spacing:0pt;">DEVELOPMENT
OF NEW CUSTOMER RELATIONSHIPS AND PROSPECTS;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;text-indent:-.25in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;text-indent:-.25in;"><font size="2" face="Symbol" style="font-size:10.0pt;letter-spacing:0pt;">&#183;</font><font size="1" style="font-size:3.0pt;letter-spacing:0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" style="font-size:10.0pt;letter-spacing:0pt;">SALES,
EARNINGS, INCOME, EXPENSES, OPERATING RESULTS, PROFIT MARGINS, LIQUIDITY,
CAPITAL RESOURCE NEEDS, CUSTOMERS AND COMPETITION.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;text-indent:-.25in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">ANY FORWARD-LOOKING INFORMATION REGARDING OUR
OPERATIONS WILL BE AFFECTED PRIMARILY BY OUR CONTINUED ABILITY TO PURCHASE
PRODUCT FROM WHIRLPOOL, GE AND FRIGIDAIRE AT ACCEPTABLE PRICES AND THE ABILITY
AND TIMING OF THE UTILITY COMPANIES TO DELIVER UNITS UNDER RECYCLING CONTRACTS
WITH US.&#160; IN ADDITION, ANY FORWARD-LOOKING
INFORMATION WILL ALSO BE AFFECTED BY THE ABILITY OF INDIVIDUAL RETAIL STORES TO
MEET PLANNED REVENUE LEVELS, THE RATE OF SUSTAINABLE GROWTH IN THE NUMBER OF
RETAIL STORES, THE SPEED AT WHICH INDIVIDUAL RETAIL STORES REACH PROFITABILITY,
COSTS AND EXPENSES BEING REALIZED AT HIGHER THAN EXPECTED LEVELS, OUR ABILITY
TO SECURE AN ADEQUATE SUPPLY OF SPECIAL-BUY APPLIANCES FOR RESALE AND THE
CONTINUED AVAILABILITY OF OUR CURRENT LINE OF CREDIT.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">ALL OF THESE FORWARD-LOOKING STATEMENTS ARE BASED ON
INFORMATION AVAILABLE TO US ON THE DATE OF THIS QUARTERLY REPORT.&#160; OUR ACTUAL RESULTS COULD DIFFER MATERIALLY
FROM THOSE DISCUSSED IN THIS QUARTERLY REPORT.&#160;
THE FORWARD-LOOKING STATEMENTS CONTAINED IN THIS QUARTERLY REPORT, AND
OTHER WRITTEN AND ORAL FORWARD-LOOKING STATEMENTS MADE BY US FROM TIME TO TIME,
ARE SUBJECT TO CERTAIN RISKS AND UNCERTAINTIES THAT COULD CAUSE ACTUAL RESULTS
TO DIFFER MATERIALLY FROM THOSE ANTICIPATED IN THE FORWARD-LOOKING
STATEMENTS.&#160; FACTORS THAT MIGHT CAUSE
SUCH A DIFFERENCE INCLUDE, BUT ARE NOT LIMITED TO, THOSE DISCUSSED IN ITEMS 1A
&#147;RISK FACTORS&#148; IN OUR ANNUAL REPORT ON FORM&nbsp;10-K FOR THE YEAR ENDED
DECEMBER 29, 2007.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">The following discussion and analysis provides
information that we believe is relevant to an assessment and understanding of
our operations and financial condition.&#160;
This discussion should be read with the consolidated financial
statements appearing in Item 1.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><u><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">OVERVIEW</font></u></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p align="left" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:left;"><font size="2" face="Times New Roman" style="font-size:10.0pt;layout-grid-mode:both;letter-spacing:0pt;">We generate revenues from three
sources:&#160; retail, recycling and
byproduct.&#160; Retail revenues are sales of
appliances, warranty and service revenue, and delivery fees.&#160; Recycling revenues are fees charged </font></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;layout-grid-mode:both;letter-spacing:0pt;">&nbsp;</font></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;layout-grid-mode:both;letter-spacing:0pt;">18</font></p>

<div align="left" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:left;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- SEQ.=1,FOLIO='18',FILE='C:\JMS\pselva\08-11369-1\task2935225\11369-1-ba-05.htm',USER='105344',CD='May 13 06:07 2008' -->


<br clear="all" style="page-break-before:always;">


<div style="font-family:Times New Roman;">

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;layout-grid-mode:both;letter-spacing:0pt;">&nbsp;</font></p>

<p align="left" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:left;"><font size="2" face="Times New Roman" style="font-size:10.0pt;layout-grid-mode:both;letter-spacing:0pt;">for the disposal of appliances.&#160; Byproduct revenues are sales of scrap metal
and reclaimed chlorofluorocarbons (CFCs) generated from processed appliances.</font></p>

<p align="left" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:left;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<h6 style="font-weight:bold;letter-spacing:-.15pt;margin:0in 0in .0001pt;"><b><u><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:normal;letter-spacing:0pt;">RESULTS OF OPERATIONS</font></u></b></h6>

<h6 style="font-weight:bold;letter-spacing:-.15pt;margin:0in 0in .0001pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></b></h6>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">Total revenue for the three months ended
March&nbsp;29, 2008 was $25,806,000 compared to $19,932,000 for the same period
in the prior year,&#160; an increase of 29%
for the three months ended&#160;
March&nbsp;29, 2008.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p align="left" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:left;"><font size="2" face="Times New Roman" style="font-size:10.0pt;layout-grid-mode:both;letter-spacing:0pt;">Retail revenues accounted for approximately 73% of
revenues in the first quarter of 2008.&#160;
Retail revenues for the thre</font><font size="2" style="font-size:10.0pt;letter-spacing:0pt;">e months
ended March&nbsp;29, 2008 </font><font size="2" style="font-size:10.0pt;layout-grid-mode:both;letter-spacing:0pt;">were
$18,962,000 compared to $17,689,000&#160; for
the same period in 2007, an increase of 7%.&#160;
Same store retail sales increased approximately $389,000 or 2.4% (a
sales comparison of fourteen stores that were open the entire first quarters of
both 2008 and 2007).&#160;&#160; </font><font size="2" style="font-size:10.0pt;letter-spacing:0pt;">The overall increase in first quarter retail revenues was due primarily to
the opening of an additional location in our Columbus, Ohio market which opened
in the fourth quarter of 2007. </font><font size="2" style="font-size:10.0pt;letter-spacing:0pt;">This
accounted for $1,201,000 in additional revenues in the first quarter of 2008.</font></p>

<p align="left" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:left;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p align="left" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:left;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">Our
retail outlets carry a wide range of new in-the-box and special-buy appliances,
which include manufacturer closeouts, factory overruns, floor samples, returned
or exchanged items, open carton items, and scratch and dent appliances.&#160; All of these appliances are new, not used.&#160; Some are in the carton while others are out
of the carton.</font></p>

<p align="left" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:left;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">We continue to purchase both new in-the-box and special-buy
appliances primarily from Whirlpool Corporation (Whirlpool), GE Corporation
(GE) and Frigidaire.&#160; We have no minimum
purchase requirements with any of these manufacturers.&#160; We believe purchases from these three
manufacturers will provide an adequate supply of high-quality appliances for
our retail outlets; however, there is a risk that one or more of these sources
could be curtailed or lost.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p align="left" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:left;"><font size="2" face="Times New Roman" style="font-size:10.0pt;layout-grid-mode:both;letter-spacing:0pt;">At March&nbsp;29, 2008, we operate fifteen
retail stores.&#160; In April, 2008 we
announced the opening of a sixth retail location in the Minneapolis, Minnesota
market, our sixteenth company wide.</font></p>

<p align="left" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:left;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p align="left" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:left;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">Recycling revenues for the three months ended
March&nbsp;29, 2008 increased 214% to $5,944,000 from $1,894,000 for the same
period in 2007.&#160; The increase in
recycling revenues is primarily due to an increase in recycling activity
associated with one of our West Coast customers and our customer located in
Canada.&#160; During the first quarter of
2008, we managed appliance recycling operations under seven contracts with
electric utility companies.&#160; </font><font size="2" style="font-size:10.0pt;letter-spacing:0pt;">These include three companies on the West Coast, two in the Midwest, one
in the South, and one in Canada.&#160; Two of
our contracts with utility customers on the West Coast run from 2006-2008. Our
contract with our Canadian utility customer runs through December, 2010. Our
contract with one of the utility customers in the Midwest runs through the end
of 2008.&#160; We expect to renew the contracts
that are expiring in 2008.</font></p>

<p align="left" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:left;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p align="left" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:left;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">We are responsible for advertising the recycling program on
behalf of one of the utility customers on the West Coast.&#160; Each of the other six utility customers is
responsible for its own advertising.</font></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">19</font></p>

<div align="left" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:left;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- SEQ.=1,FOLIO='19',FILE='C:\JMS\pselva\08-11369-1\task2935225\11369-1-ba-05.htm',USER='105344',CD='May 13 06:07 2008' -->


<br clear="all" style="page-break-before:always;">


<div style="font-family:Times New Roman;">

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">Byproduct revenues for the three months ended
March&nbsp;29, 2008 increased 158% to $900,000 from $349,000 for the same
period of 2007.&#160; The increases were due
primarily to an increase in scrap metal volume and prices in California,
Minnesota, and Canada.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">Gross profit as a percentage of total revenues for
the three months ended March&nbsp;29, 2008 decreased to 31% from 33%, for the
same period in 2007.&#160; The decrease was
primarily due to maintaining staffing levels for our various recycling programs
in anticipation of the normal seasonal increase in volumes associated with
these programs.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">We expect gross margins for the remainder of the
year to be approximately 30%-32% based on currently planned levels of recycling
volume and retail product purchases, as well as estimated pricing adjustments
that may be needed to reflect conditions in the overall appliance retail
market.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">Gross profit as a percentage of total revenues for
future periods can be affected favorably or unfavorably by numerous factors,
including:</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 49.5pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">1.</font><font size="1" style="font-size:3.0pt;letter-spacing:0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" style="font-size:10.0pt;letter-spacing:0pt;">The mix
of retail products we sell.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 49.5pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">2.</font><font size="1" style="font-size:3.0pt;letter-spacing:0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" style="font-size:10.0pt;letter-spacing:0pt;">The
prices at which we purchase product from the three manufacturers.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 49.5pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">3.</font><font size="1" style="font-size:3.0pt;letter-spacing:0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" style="font-size:10.0pt;letter-spacing:0pt;">Transportation
costs including but not limited to fuel costs.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 49.5pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">4.</font><font size="1" style="font-size:3.0pt;letter-spacing:0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" style="font-size:10.0pt;letter-spacing:0pt;">The
volume of appliances we receive through our recycling contracts.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 49.5pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">5.</font><font size="1" style="font-size:3.0pt;letter-spacing:0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" style="font-size:10.0pt;letter-spacing:0pt;">The price
and volume of byproduct revenues.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 49.5pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">Selling, general, and administrative expenses for the three
months ended March&nbsp;29, 2008 increased by $837,000 or 13%, from the same
periods in 2007.&#160; As a percentage of
total revenues, selling, general and administrative expenses decreased to 29%
for the first quarter of 2008 compared to 34% for the first quarter of
2007.&#160; Selling expenses for the three
months ended March&nbsp;29, 2008 increased by $111,000 or 2% from the same
period in 2007.&#160; The increase in selling
expenses was due primarily to the additional costs of operating the new outlet
store in Columbus, Ohio, offset by the decrease in selling expense resulting
from the closing of our retail outlet in Los Angeles, California in the third
quarter of 2007.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">General and administrative expenses for the three months
ended March&nbsp;29, 2008 increased by $726,000 or 37% from the same period in
2007.&#160; The increase in general and
administrative expense was due primarily to additional personnel costs
associated with operating additional retail stores and recycling contracts, an
increase in stock-based compensation expense resulting from options granted to
management and new board members in the first quarter, and legal costs
associated with the legal proceedings discussed in Part&nbsp;II, Item 1, Legal
Proceedings.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">Interest expense increased to $397,000 for the three months
ended March&nbsp;29, 2008 compared to $298,000 for the same period in
2007.&#160; The increase was due primarily to
an increase in the outstanding amount on the line of credit and an increase in
the interest rate on the mortgage on the St. Louis Park, Minnesota facility.</font></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">20</font></p>

<div style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- SEQ.=1,FOLIO='20',FILE='C:\JMS\pselva\08-11369-1\task2935225\11369-1-ba-05.htm',USER='105344',CD='May 13 06:07 2008' -->


<br clear="all" style="page-break-before:always;">


<div>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">We recorded net income of $117,000 or $0.03 per
diluted share for the first quarter ended March&nbsp;29, 2008 compared to a loss
of $472,000 or $0.11 per basic and diluted share for the same period of 2007.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;text-indent:-.5in;"><u><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">LIQUIDITY
AND CAPITAL RESOURCES</font></u></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .5in;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">At March&nbsp;29, 2008, we had working capital of
$5,473,000 compared to $5,126,000 at December&nbsp;29, 2007.&#160; Cash and cash equivalents decreased to
$1,853,000 at March&nbsp;29, 2008 from $2,777,000 at December&nbsp;29,
2007.&#160; Net cash provided by operating
activities was $1,215,000 for the three months ended March&nbsp;29, 2008
compared to net cash provided by operating activities of $540,000 in the same
period of 2007.&#160; The cash provided by
operating activities was primarily due to an increase in net income along with
the changes in working capital as follows:&#160;
a decrease in accounts receivable, offset by an an increase in inventory
and a decrease in accounts payable and accrued expenses.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">Our capital expenditures for the three months ended
March&nbsp;29, 2008 were approximately $173,000. The 2008 capital expenditures
were related primarily to building improvements, and upgraded computer and
phone equipment to handle increased retail and recycling business.&#160; The 2007 capital expenditures were related
primarily to software development and building improvements.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">Net cash used in financing activities was $1,941,000 for
the three months ended March&nbsp;29, 2008 compared to $135,000 in the same
period in 2007.&#160; The cash used for
financing was primarily due to payments on the line of credit and for long-term
obligations, offset by proceeds from the exercise of stock options.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">At March&nbsp;29, 2008, we had a $18.0 million line of
credit with a lender.&#160; The interest rate
on the line as of March&nbsp;29, 2008 was prime plus 2 percentage points
(7.25%).&#160; The amount of borrowings
available under the line of credit is based on a formula using receivables and
inventories.&#160; The line of credit has a
stated maturity date of December&nbsp;31, 2010, if not renewed, and provides
that the lender may demand payment in full of the entire outstanding balance of
the loan at any time.&#160; The line of credit
is secured by substantially all our assets and requires minimum monthly
interest payments of $58,000, regardless of the outstanding principal
balance.&#160; The lender is also secured by
an inventory repurchase agreement with Whirlpool Corporation (Whirlpool) for
purchases from Whirlpool only.&#160; The line
requires that we meet certain financial covenants, provides payment penalties
for noncompliance and prepayment, limits the amount of other debt we can incur,
limits the amount of spending on fixed assets, and prohibits payments of
dividends.&#160; As of March&nbsp;29, 2008, we
were in compliance with all covenants.&#160;
At March&nbsp;29, 2008, we had available borrowing capacity of $827,000.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">We believe, based on our anticipated sales per retail
store, revenues from our recycling contracts and gross profit, that our cash
balance, funds generated from operations and line of credit will be sufficient
to finance our operations and capital expenditures for at least the next twelve
months.</font></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">21</font></p>

<div style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- SEQ.=1,FOLIO='21',FILE='C:\JMS\pselva\08-11369-1\task2935225\11369-1-ba-05.htm',USER='105344',CD='May 13 06:07 2008' -->


<br clear="all" style="page-break-before:always;">


<div style="font-family:Times New Roman;">

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">Our total capital requirements for 2008 will depend upon,
among other things as discussed below, the number and size of retail stores
operating during the fiscal year and the recycling volumes generated from the
recycling contracts in 2008.&#160; Currently,
we have fifteen retail stores and four recycling centers in operation.&#160; If revenues are lower than anticipated or
expenses are higher than anticipated, we may require additional capital to
finance operations.&#160; Sources of
additional financing, if needed in the future, may include further debt
financing or the sale of equity (common or preferred stock) or other
securities.&#160; There can be no assurance
that such additional sources of financing will be available or available on
terms satisfactory to us or permitted by our current lender.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">PART&nbsp;I:&#160; ITEM 4</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" style="font-size:10.0pt;">CONTROLS AND PROCEDURES<a name="PartiItem4ControlsAndProcedures_050457"></a></font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">We maintain disclosure controls and procedures that are
designed to ensure that information required to be disclosed in the reports we
file with the Securities and Exchange Commission pursuant to the Securities
Exchange Act of 1934 is recorded, processed, summarized and reported within the
time periods specified in the rules&nbsp;and forms of the Commission and that
such information is accumulated and communicated to our management, including
our Chief Executive Officer (CEO), Chief Financial Officer (CFO), and
Controller (principal accounting officer), as appropriate, to allow timely
decisions regarding required disclosures.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">We also maintain a system of internal accounting controls
designed to provide reasonable assurance that our books and records accurately
reflect our transactions and that our policies and procedures are followed.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">Our management, under the supervision and with the
participation of our CEO, CFO and Principal Accounting Officer, has evaluated
the effectiveness of the design and operation of our disclosure controls and
procedures as of the end of the period covered by this quarterly report and
evaluated the controls and procedures implemented in response to the material
weakness in financial reporting disclosed in our annual report on Form&nbsp;10-K
relating to review of certain inventory and intercompany reconciliations.&#160; Management continues to implement, document,
and test new controls and procedures and believes the material weakness will be
fully remediated in 2008.&#160; Except for
changes made to address such weaknesses, there have been no changes in our
internal control over financial reporting during the fiscal quarter ended
March&nbsp;29, 2008, or thereafter, that have materially affected, or are
reasonable likely to materially affect, our internal control over financial
reporting.&#160; Also, management has
concluded that, except for such weakness, our disclosure&#160; controls and procedures were effective as of
March&nbsp;29, 2008.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">Any control system, no matter how well conceived and
operated, can provide only reasonable, not absolute, assurance that the
objectives of the control system are met.&#160;
The design of a control system inherently has limitations, and the
benefits of controls must be weighed against their costs.&#160; Additionally, controls can be circumvented by
the individual acts of some persons, by collusion of two or more people, or by
management override of the control.&#160;
Therefore, no evaluation of a cost-effective</font></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">22</font></p>

<div style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- SEQ.=1,FOLIO='22',FILE='C:\JMS\pselva\08-11369-1\task2935225\11369-1-ba-05.htm',USER='105344',CD='May 13 06:07 2008' -->


<br clear="all" style="page-break-before:always;">


<div style="font-family:Times New Roman;">

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">system of controls can provide absolute assurance that all
control issues and instances of fraud, if any, will be detected.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">PART&nbsp;II.</font><font size="1" style="font-size:3.0pt;letter-spacing:0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" style="font-size:10.0pt;letter-spacing:0pt;">OTHER INFORMATION<a name="Partii_OtherInformation_050614"></a></font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .25in;text-indent:-.25in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">ITEM 1&nbsp;&nbsp;-&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<u>LEGAL
PROCEEDINGS</u><a name="Item1LegalProceedings_050630"></a></font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">In December&nbsp;2004, we filed suit in the U.S. District
Court for the Central District of California alleging that JACO
Environmental,&nbsp;Inc., (JACO) and one of our former consultants fraudulently
obtained U.S. Patent No.&nbsp;6,732,416 in May&nbsp;2004 covering appliance
recycling methods and systems which were originally developed by us beginning
in 1987 and used in serving more than forty-five electric utility appliance
recycling programs since that time.&#160; We
are seeking an injunction to prevent JACO from claiming that it obtained a
valid patent on appliance recycling processes that we believe is based on
methods and processes we invented. In addition, we are seeking a finding by the
Court that the patent obtained by JACO is unenforceable due to inequitable
conduct before the United States Patent Office.&#160;
We are also asking the court for unspecified damages related to charges
that JACO, in using the patent to promote its services, has engaged in unfair
competition and false and misleading advertising under federal and California
statutes.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">In September&nbsp;2005, we received a legally binding
document in which JACO states it will not sue us or any of our customers for
violating the JACO patent. Further, the defendants in the case have not
asserted any counterclaims against ARCA. Therefore, our recycling operations
will continue with our current contracts and future customers without
interruption.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">The case is scheduled for trial in November&nbsp;of 2008.
The trial is expected to last approximately two weeks.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p style="color:black;letter-spacing:0pt;line-height:normal;margin:0in 0in .0001pt;text-autospace:none;"><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;">On October&nbsp;24, 2006, JACO and SEG Umwelt-Service/Basis
of Mettlach, Germany (SEG) filed a patent infringement lawsuit in Federal Court
in San Francisco against us.&#160; The suit
claimed that we have been using refrigerator recycling systems and processes
covered by two U.S. patents issued to SEG and exclusively licensed to JACO.&#160; JACO and SEG sought an undisclosed amount in
damages, in addition to an injunction barring us from continuing to use and
market the systems and processes upon which we allegedly infringed. This suit
has been subsequently dismissed following a transfer of the case to Los Angeles
upon the motion of ARCA.</font></p>

<p style="color:black;letter-spacing:0pt;line-height:normal;margin:0in 0in .0001pt;text-autospace:none;"><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .25in;text-indent:-.25in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">ITEM 2&nbsp;&nbsp;-&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<u>UNREGISTERED
SALES OF EQUITY SECURITIES AND USE OF PROCEEDS</u> - None<a name="Item2UnregisteredSalesOfEquitySec_050840"></a></font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt 1.0in;text-indent:-1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .25in;text-indent:-.25in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">ITEM 3&nbsp;&nbsp;-&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<u>DEFAULTS
UPON SENIOR SECURITIES</u> - None<a name="Item3DefaultsUponSeniorSecurities_050844"></a></font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .25in;text-indent:-.25in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">ITEM 4&nbsp;&nbsp;-&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<u>SUBMISSION
OF MATTERS TO A VOTE OF SECURITY HOLDERS</u> &#150; None<a name="Item4SubmissionOfMattersToAVoteOf_050845"></a></font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .25in;text-indent:-.25in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">ITEM 5&nbsp;&nbsp;-&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<u>OTHER
INFORMATION</u> - None<a name="Item5OtherInformationNone_050853"></a></font></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">23</font></p>

<div style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- SEQ.=1,FOLIO='23',FILE='C:\JMS\pselva\08-11369-1\task2935225\11369-1-ba-05.htm',USER='105344',CD='May 13 06:07 2008' -->


<br clear="all" style="page-break-before:always;">


<div>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt .25in;text-indent:-.25in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">ITEM 6&nbsp;&nbsp;-&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<u>EXHIBITS</u><a name="Item6Exhibits_050854"></a></font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">Exhibit&nbsp;31.1 &#150; Certification pursuant to 18
U.S.C. Section&nbsp;1350, as adopted pursuant to Section&nbsp;302 of the
Sarbanes-Oxley Act of 2002.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">Exhibit&nbsp;31.2 &#150; Certification pursuant to 18
U.S.C. Section&nbsp;1350, as adopted pursuant to Section&nbsp;302 of the
Sarbanes-Oxley Act of 2002.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">Exhibit&nbsp;31.3 &#150; Certification pursuant to 18
U.S.C. Section&nbsp;1350, as adopted pursuant to Section&nbsp;302 of the
Sarbanes-Oxley Act of 2002.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">Exhibit&nbsp;32 &#150; Certifications pursuant to 18
U.S.C. Section&nbsp;1350, as adopted pursuant to Section&nbsp;906 of the
Sarbanes-Oxley Act of 2002.</font></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">24</font></p>

<div style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- SEQ.=1,FOLIO='24',FILE='C:\JMS\pselva\08-11369-1\task2935225\11369-1-ba-05.htm',USER='105344',CD='May 13 06:07 2008' -->


<br clear="all" style="page-break-before:always;">


<div>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;letter-spacing:0pt;">SIGNATURES</font></b><a name="Signatures_050928"></a></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">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></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;width:100.0%;">
 <tr>
  <td width="19%" valign="top" style="padding:0in 0in 0in 0in;width:19.8%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="28%" valign="top" style="padding:0in 0in 0in 0in;width:28.48%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="51%" rowspan="2" valign="top" style="padding:0in 0in 0in 0in;width:51.72%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><u><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">Appliance Recycling Centers of America,&nbsp;Inc.</font></u></p>
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">Registrant</font></p>
  </td>
 </tr>
 <tr>
  <td width="19%" valign="top" style="padding:0in 0in 0in 0in;width:19.8%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="28%" valign="top" style="padding:0in 0in 0in 0in;width:28.48%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="19%" valign="top" style="padding:0in 0in 0in 0in;width:19.8%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="28%" valign="top" style="padding:0in 0in 0in 0in;width:28.48%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="51%" valign="top" style="padding:0in 0in 0in 0in;width:51.72%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="19%" valign="top" style="padding:0in 0in 0in 0in;width:19.8%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="28%" valign="top" style="padding:0in 0in 0in 0in;width:28.48%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="51%" valign="top" style="padding:0in 0in 0in 0in;width:51.72%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="19%" valign="top" style="padding:0in 0in 0in 0in;width:19.8%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">Date: May&nbsp;13, 2008</font></p>
  </td>
  <td width="28%" valign="top" style="padding:0in 0in 0in 0in;width:28.48%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="51%" valign="top" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:51.72%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">/s/Edward R. Cameron</font></p>
  </td>
 </tr>
 <tr>
  <td width="19%" valign="top" style="padding:0in 0in 0in 0in;width:19.8%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="28%" valign="top" style="padding:0in 0in 0in 0in;width:28.48%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="51%" valign="top" style="padding:0in 0in 0in 0in;width:51.72%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">Edward R. Cameron</font></p>
  </td>
 </tr>
 <tr>
  <td width="19%" valign="top" style="padding:0in 0in 0in 0in;width:19.8%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="28%" valign="top" style="padding:0in 0in 0in 0in;width:28.48%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="51%" valign="top" style="padding:0in 0in 0in 0in;width:51.72%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">President and Chief Executive Officer</font></p>
  </td>
 </tr>
 <tr>
  <td width="19%" valign="top" style="padding:0in 0in 0in 0in;width:19.8%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="28%" valign="top" style="padding:0in 0in 0in 0in;width:28.48%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="51%" valign="top" style="padding:0in 0in 0in 0in;width:51.72%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="19%" valign="top" style="padding:0in 0in 0in 0in;width:19.8%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="28%" valign="top" style="padding:0in 0in 0in 0in;width:28.48%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="51%" valign="top" style="padding:0in 0in 0in 0in;width:51.72%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="19%" valign="top" style="padding:0in 0in 0in 0in;width:19.8%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">Date: May&nbsp;13, 2008</font></p>
  </td>
  <td width="28%" valign="top" style="padding:0in 0in 0in 0in;width:28.48%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="51%" valign="top" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:51.72%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">/s/Peter P. Hausback</font></p>
  </td>
 </tr>
 <tr>
  <td width="19%" valign="top" style="padding:0in 0in 0in 0in;width:19.8%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="28%" valign="top" style="padding:0in 0in 0in 0in;width:28.48%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="51%" valign="top" style="padding:0in 0in 0in 0in;width:51.72%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">Peter P. Hausback</font></p>
  </td>
 </tr>
 <tr>
  <td width="19%" valign="top" style="padding:0in 0in 0in 0in;width:19.8%;">
  <p align="left" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:left;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="28%" valign="top" style="padding:0in 0in 0in 0in;width:28.48%;">
  <p align="left" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:left;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="51%" valign="top" style="padding:0in 0in 0in 0in;width:51.72%;">
  <p align="left" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:left;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">EVP and Chief Financial Officer</font></p>
  </td>
 </tr>
 <tr>
  <td width="19%" valign="top" style="padding:0in 0in 0in 0in;width:19.8%;">
  <p align="left" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:left;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="28%" valign="top" style="padding:0in 0in 0in 0in;width:28.48%;">
  <p align="left" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:left;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="51%" valign="top" style="padding:0in 0in 0in 0in;width:51.72%;">
  <p align="left" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:left;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="19%" valign="top" style="padding:0in 0in 0in 0in;width:19.8%;">
  <p align="left" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:left;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="28%" valign="top" style="padding:0in 0in 0in 0in;width:28.48%;">
  <p align="left" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:left;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="51%" valign="top" style="padding:0in 0in 0in 0in;width:51.72%;">
  <p align="left" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:left;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="19%" valign="top" style="padding:0in 0in 0in 0in;width:19.8%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">Date: May&nbsp;13, 2008</font></p>
  </td>
  <td width="28%" valign="top" style="padding:0in 0in 0in 0in;width:28.48%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="51%" valign="top" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:51.72%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">/s/Patrick J. Winters</font></p>
  </td>
 </tr>
 <tr>
  <td width="19%" valign="top" style="padding:0in 0in 0in 0in;width:19.8%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="28%" valign="top" style="padding:0in 0in 0in 0in;width:28.48%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="51%" valign="top" style="padding:0in 0in 0in 0in;width:51.72%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">Patrick J. Winters</font></p>
  </td>
 </tr>
 <tr>
  <td width="19%" valign="top" style="padding:0in 0in 0in 0in;width:19.8%;">
  <p align="left" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:left;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="28%" valign="top" style="padding:0in 0in 0in 0in;width:28.48%;">
  <p align="left" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:left;"><font size="2" face="Times New Roman" style="font-size:1.0pt;letter-spacing:0pt;">&nbsp;</font></p>
  </td>
  <td width="51%" valign="top" style="padding:0in 0in 0in 0in;width:51.72%;">
  <p align="left" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:left;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">Controller (Principal Accounting Officer)</font></p>
  </td>
 </tr>
</table>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">&nbsp;</font></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">25</font></p>

<div align="left" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:left;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- SEQ.=1,FOLIO='25',FILE='C:\JMS\pselva\08-11369-1\task2935225\11369-1-ba-05.htm',USER='105344',CD='May 13 06:07 2008' -->


</body>

</html>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-31.1
<SEQUENCE>2
<FILENAME>a08-11369_1ex31d1.htm
<DESCRIPTION>EX-31.1
<TEXT>

<html>

<head>





</head>

<body lang="EN-US">

<div style="font-family:Times New Roman;">

<p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Exhibit&nbsp;31.1</font></b></p>

<p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;text-autospace:none;"><b><u><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">FORM&nbsp;10-Q CEO CERTIFICATION</font></u></b></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in .6pt .0001pt 0in;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">CERTIFICATIONS:</font></b></p>

<p style="letter-spacing:-.15pt;margin:0in .6pt .0001pt 0in;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in .6pt .0001pt 0in;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">I,
Edward R. Cameron, certify that:</font></p>

<p style="letter-spacing:-.15pt;margin:0in .6pt .0001pt 0in;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt .5in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">1.</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" style="font-size:10.0pt;">I have reviewed
this Quarterly Report on Form&nbsp;10-Q of Appliance Recycling Centers of
America,&nbsp;Inc.;</font></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt .5in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt .5in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2.</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" style="font-size:10.0pt;">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 are made, not misleading
with respect to the period covered by this report;</font></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt .5in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt .5in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">3.</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" style="font-size:10.0pt;">Based on my
knowledge, the consolidated 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></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt .5in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt .5in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4.</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" style="font-size:10.0pt;">The
registrant&#146;s other certifying officer and I are responsible for establishing
and maintaining disclosure controls and procedures (as defined in Exchange Act Rules&nbsp;13a-15(e)&nbsp;and
15d-15(e)) and internal control over financial reporting (as defined in
Exchange Act Rules&nbsp;13a &#150; 15(f)&nbsp;and 15(d)&nbsp;&#150; 15(f)) for the
registrant and we have:</font></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt .5in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt 1.0in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" style="font-size:10.0pt;">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></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt 1.0in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt 1.0in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" style="font-size:10.0pt;">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&#160; and the preparation of financial statements
for external purposes in accordance with generally accepted accounting
principles;</font></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt 1.0in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt 1.0in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(c)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" style="font-size:10.0pt;">evaluated the effectiveness
of the registrant&#146;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></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt 1.0in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt 1.0in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(d)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" style="font-size:10.0pt;">disclosed in this report any
change in the registrant&#146;s internal control over financial reporting that
occurred during the registrant&#146;s most recent fiscal quarter (the registrant&#146;s
fourth fiscal quarter in the case of an annual report) that has materially
affected, or is reasonably likely to materially affect, the registrant&#146;s
internal control over financial reporting; and</font></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt 1.0in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt .5in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">5.</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" style="font-size:10.0pt;">The
registrant&#146;s other certifying officer and I have disclosed, based on our most
recent evaluation of internal control over financial reporting, to the
registrant&#146;s auditors and the audit committee of registrant&#146;s board of
directors (or persons performing the equivalent function):</font></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt .5in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt 1.0in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" style="font-size:10.0pt;">all significant deficiencies
and material weaknesses in the design or operation of internal control over
financial reporting that are reasonably likely to adversely affect the
registrant&#146;s ability to record, process, summarize and report financial
information; and</font></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt 1.0in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt 1.0in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" style="font-size:10.0pt;">any fraud, whether or not
material, that involves management or other employees who have a significant
role in the registrant&#146;s internal control over financial reporting.</font></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt 1.0in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;width:100.0%;">
 <tr>
  <td width="9%" valign="top" style="padding:0in 0in 0in 0in;width:9.0%;">
  <p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt 0in;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="36%" valign="top" style="padding:0in 0in 0in 0in;width:36.18%;">
  <p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt 0in;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="3%" valign="top" style="padding:0in 0in 0in 0in;width:3.84%;">
  <p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt 0in;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="5%" valign="top" style="padding:0in 0in 0in 0in;width:5.26%;">
  <p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt 0in;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="45%" valign="top" style="padding:0in 0in 0in 0in;width:45.72%;">
  <p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt 0in;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="9%" valign="top" style="padding:0in 0in 0in 0in;width:9.0%;">
  <p style="letter-spacing:-.15pt;margin:0in .6pt .0001pt 0in;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Date:</font></p>
  </td>
  <td width="36%" valign="top" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:36.18%;">
  <p style="letter-spacing:-.15pt;margin:0in .6pt .0001pt 0in;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">May&nbsp;
  13, 2008</font></p>
  </td>
  <td width="3%" valign="top" style="padding:0in 0in 0in 0in;width:3.84%;">
  <p style="letter-spacing:-.15pt;margin:0in .6pt .0001pt 0in;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="5%" valign="top" style="padding:0in 0in 0in 0in;width:5.26%;">
  <p style="letter-spacing:-.15pt;margin:0in .6pt .0001pt 0in;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">By:</font></p>
  </td>
  <td width="45%" valign="top" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:45.72%;">
  <p style="letter-spacing:-.15pt;margin:0in .6pt .0001pt 0in;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">/s/
  Edward R. Cameron</font></p>
  </td>
 </tr>
 <tr>
  <td width="9%" valign="top" style="padding:0in 0in 0in 0in;width:9.0%;">
  <p style="letter-spacing:-.15pt;margin:0in .6pt .0001pt 0in;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="36%" valign="top" style="border:none;padding:0in 0in 0in 0in;width:36.18%;">
  <p style="letter-spacing:-.15pt;margin:0in .6pt .0001pt 0in;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="3%" valign="top" style="padding:0in 0in 0in 0in;width:3.84%;">
  <p style="letter-spacing:-.15pt;margin:0in .6pt .0001pt 0in;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="5%" valign="top" style="padding:0in 0in 0in 0in;width:5.26%;">
  <p style="letter-spacing:-.15pt;margin:0in .6pt .0001pt 0in;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="45%" valign="top" style="padding:0in 0in 0in 0in;width:45.72%;">
  <p style="letter-spacing:-.15pt;margin:0in .6pt .0001pt 0in;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Edward
  R. Cameron, President and CEO</font></p>
  </td>
 </tr>
</table>

<p style="letter-spacing:-.15pt;margin:0in .6pt .0001pt 0in;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<div style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-autospace:none;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- SEQ.=1,FOLIO='',FILE='C:\JMS\pselva\08-11369-1\task2935225\11369-1-ma.htm',USER='105344',CD='May 13 06:07 2008' -->


</body>

</html>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-31.2
<SEQUENCE>3
<FILENAME>a08-11369_1ex31d2.htm
<DESCRIPTION>EX-31.2
<TEXT>

<html>

<head>





</head>

<body lang="EN-US">

<div style="font-family:Times New Roman;">

<p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Exhibit&nbsp;31.2</font></b></p>

<p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;text-autospace:none;"><b><u><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">FORM&nbsp;10-Q CFO CERTIFICATION</font></u></b></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in .6pt .0001pt 0in;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">CERTIFICATIONS:</font></b></p>

<p style="letter-spacing:-.15pt;margin:0in .6pt .0001pt 0in;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in .6pt .0001pt 0in;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">I,
Peter P. Hausback, certify that:</font></p>

<p style="letter-spacing:-.15pt;margin:0in .6pt .0001pt 0in;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt .5in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">6.</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" style="font-size:10.0pt;">I have reviewed
this Quarterly Report on Form&nbsp;10-Q of Appliance Recycling Centers of
America,&nbsp;Inc.;</font></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt .5in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt .5in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">7.</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" style="font-size:10.0pt;">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 are made, not misleading
with respect to the period covered by this report;</font></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt .5in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt .5in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">8.</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" style="font-size:10.0pt;">Based on my
knowledge, the consolidated 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></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt .5in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt .5in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">9.</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" style="font-size:10.0pt;">The
registrant&#146;s other certifying officer and I are responsible for establishing
and maintaining disclosure controls and procedures (as defined in Exchange Act Rules&nbsp;13a-15(e)&nbsp;and
15d-15(e)) and internal control over financial reporting (as defined in
Exchange Act Rules&nbsp;13a &#150; 15(f)&nbsp;and 15(d)&nbsp;&#150; 15(f)) for the
registrant and we have:</font></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt .5in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt 1.0in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" style="font-size:10.0pt;">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></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt 1.0in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt 1.0in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" style="font-size:10.0pt;">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&#160; and the preparation of financial statements
for external purposes in accordance with generally accepted accounting
principles;</font></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt 1.0in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt 1.0in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(c)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" style="font-size:10.0pt;">evaluated the effectiveness
of the registrant&#146;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></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt 1.0in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt 1.0in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(d)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" style="font-size:10.0pt;">disclosed in this report any
change in the registrant&#146;s internal control over financial reporting that
occurred during the registrant&#146;s most recent fiscal quarter (the registrant&#146;s
fourth fiscal quarter in the case of an annual report) that has materially
affected, or is reasonably likely to materially affect, the registrant&#146;s
internal control over financial reporting; and</font></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt 1.0in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt .5in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">10.</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" style="font-size:10.0pt;">The registrant&#146;s other
certifying officer and I have disclosed, based on our most recent evaluation of
internal control over financial reporting, to the registrant&#146;s auditors and the
audit committee of registrant&#146;s board of directors (or persons performing the
equivalent function):</font></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt .5in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt 1.0in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(c)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" style="font-size:10.0pt;">all significant deficiencies
and material weaknesses in the design or operation of internal control over
financial reporting that are reasonably likely to adversely affect the
registrant&#146;s ability to record, process, summarize and report financial
information; and</font></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt 1.0in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt 1.0in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(d)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" style="font-size:10.0pt;">any fraud, whether or not
material, that involves management or other employees who have a significant
role in the registrant&#146;s internal control over financial reporting.</font></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt 1.0in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt 1.0in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;width:100.0%;">
 <tr>
  <td width="10%" valign="top" style="padding:0in 0in 0in 0in;width:10.46%;">
  <p style="letter-spacing:-.15pt;margin:0in .6pt .0001pt 0in;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Date:</font></p>
  </td>
  <td width="37%" valign="top" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:37.62%;">
  <p style="letter-spacing:-.15pt;margin:0in .6pt .0001pt 0in;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">May&nbsp;
  13, 2008</font></p>
  </td>
  <td width="4%" valign="top" style="padding:0in 0in 0in 0in;width:4.16%;">
  <p style="letter-spacing:-.15pt;margin:0in .6pt .0001pt 0in;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="5%" valign="top" style="padding:0in 0in 0in 0in;width:5.1%;">
  <p style="letter-spacing:-.15pt;margin:0in .6pt .0001pt 0in;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">By:</font></p>
  </td>
  <td width="42%" valign="top" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:42.66%;">
  <p style="letter-spacing:-.15pt;margin:0in .6pt .0001pt 0in;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">/s/
  Peter P. Hausback</font></p>
  </td>
 </tr>
 <tr>
  <td width="10%" valign="top" style="padding:0in 0in 0in 0in;width:10.46%;">
  <p style="letter-spacing:-.15pt;margin:0in .6pt .0001pt 0in;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="41%" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:41.78%;">
  <p style="letter-spacing:-.15pt;margin:0in .6pt .0001pt 0in;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="5%" valign="top" style="padding:0in 0in 0in 0in;width:5.1%;">
  <p style="letter-spacing:-.15pt;margin:0in .6pt .0001pt 0in;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="42%" valign="top" style="border:none;padding:0in 0in 0in 0in;width:42.66%;">
  <p style="letter-spacing:-.15pt;margin:0in .6pt .0001pt 0in;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Peter
  P. Hausback, EVP and CFO</font></p>
  </td>
 </tr>
</table>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<div style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-autospace:none;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- SEQ.=1,FOLIO='',FILE='C:\JMS\pselva\08-11369-1\task2935225\11369-1-mc.htm',USER='105344',CD='May 13 06:15 2008' -->


</body>

</html>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-31.3
<SEQUENCE>4
<FILENAME>a08-11369_1ex31d3.htm
<DESCRIPTION>EX-31.3
<TEXT>

<html>

<head>





</head>

<body lang="EN-US">

<div style="font-family:Times New Roman;">

<p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Exhibit&nbsp;31.3</font></b></p>

<p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;text-autospace:none;"><b><u><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">FORM&nbsp;10-Q PRINCIPAL ACCOUNTING OFFICER CERTIFICATION</font></u></b></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in .6pt .0001pt 0in;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">CERTIFICATIONS:</font></b></p>

<p style="letter-spacing:-.15pt;margin:0in .6pt .0001pt 0in;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in .6pt .0001pt 0in;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">I,
Patrick J. Winters, certify that:</font></p>

<p style="letter-spacing:-.15pt;margin:0in .6pt .0001pt 0in;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt .5in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">11.</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" style="font-size:10.0pt;">I have reviewed this
Quarterly Report on Form&nbsp;10-Q of Appliance Recycling Centers of America,&nbsp;Inc.;</font></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt .5in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt .5in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">12.</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" style="font-size:10.0pt;">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 are made, not misleading with respect
to the period covered by this report;</font></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt .5in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt .5in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">13.</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" style="font-size:10.0pt;">Based on my knowledge, the
consolidated 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></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt .5in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt .5in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">14.</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" style="font-size:10.0pt;">The registrant&#146;s other
certifying officer and I are responsible for establishing and maintaining
disclosure controls and procedures (as defined in Exchange Act Rules&nbsp;13a-15(e)&nbsp;and
15d-15(e)) and internal control over financial reporting (as defined in
Exchange Act Rules&nbsp;13a &#150; 15(f)&nbsp;and 15(d)&nbsp;&#150; 15(f)) for the
registrant and we have:</font></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt .5in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt 1.0in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" style="font-size:10.0pt;">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></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt 1.0in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt 1.0in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" style="font-size:10.0pt;">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&#160; and the preparation of financial statements
for external purposes in accordance with generally accepted accounting
principles;</font></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt 1.0in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt 1.0in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(c)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" style="font-size:10.0pt;">evaluated the effectiveness
of the registrant&#146;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></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt 1.0in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt 1.0in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(d)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" style="font-size:10.0pt;">disclosed in this report any
change in the registrant&#146;s internal control over financial reporting that
occurred during the registrant&#146;s most recent fiscal quarter (the registrant&#146;s
fourth fiscal quarter in the case of an annual report) that has materially
affected, or is reasonably likely to materially affect, the registrant&#146;s
internal control over financial reporting; and</font></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt 1.0in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt .5in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">15.</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" style="font-size:10.0pt;">The registrant&#146;s other
certifying officer and I have disclosed, based on our most recent evaluation of
internal control over financial reporting, to the registrant&#146;s auditors and the
audit committee of registrant&#146;s board of directors (or persons performing the
equivalent function):</font></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt .5in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt 1.0in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(e)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" style="font-size:10.0pt;">all significant deficiencies
and material weaknesses in the design or operation of internal control over
financial reporting that are reasonably likely to adversely affect the
registrant&#146;s ability to record, process, summarize and report financial
information; and</font></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt 1.0in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt 1.0in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(f)</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font size="2" style="font-size:10.0pt;">any fraud, whether or not
material, that involves management or other employees who have a significant
role in the registrant&#146;s internal control over financial reporting.</font></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt 1.0in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in .7pt .0001pt 1.0in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;width:100.0%;">
 <tr>
  <td width="11%" valign="top" style="padding:0in 0in 0in 0in;width:11.1%;">
  <p style="letter-spacing:-.15pt;margin:0in .6pt .0001pt 0in;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Date:</font></p>
  </td>
  <td width="37%" valign="top" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:37.06%;">
  <p style="letter-spacing:-.15pt;margin:0in .6pt .0001pt 0in;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">May&nbsp;
  13, 2008</font></p>
  </td>
  <td width="5%" valign="top" style="padding:0in 0in 0in 0in;width:5.6%;">
  <p style="letter-spacing:-.15pt;margin:0in .6pt .0001pt 0in;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="5%" valign="top" style="padding:0in 0in 0in 0in;width:5.6%;">
  <p style="letter-spacing:-.15pt;margin:0in .6pt .0001pt 0in;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">By:</font></p>
  </td>
  <td width="40%" valign="top" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;width:40.66%;">
  <p style="letter-spacing:-.15pt;margin:0in .6pt .0001pt 0in;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">/s/
  Patrick J. Winters</font></p>
  </td>
 </tr>
 <tr>
  <td width="11%" valign="top" style="padding:0in 0in 0in 0in;width:11.1%;">
  <p style="letter-spacing:-.15pt;margin:0in .6pt .0001pt 0in;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="42%" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:42.64%;">
  <p style="letter-spacing:-.15pt;margin:0in .6pt .0001pt 0in;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="5%" valign="top" style="padding:0in 0in 0in 0in;width:5.6%;">
  <p style="letter-spacing:-.15pt;margin:0in .6pt .0001pt 0in;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="40%" valign="top" style="padding:0in 0in 0in 0in;width:40.66%;">
  <p style="letter-spacing:-.15pt;margin:0in .6pt .0001pt 0in;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Patrick
  J. Winters, Controller</font></p>
  </td>
 </tr>
</table>

<p style="letter-spacing:-.15pt;margin:0in .6pt .0001pt 0in;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<div style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-autospace:none;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- SEQ.=1,FOLIO='',FILE='C:\JMS\pselva\08-11369-1\task2935225\11369-1-me.htm',USER='105344',CD='May 13 06:17 2008' -->


</body>

</html>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-32
<SEQUENCE>5
<FILENAME>a08-11369_1ex32.htm
<DESCRIPTION>EX-32
<TEXT>

<html>

<head>





</head>

<body lang="EN-US">

<div>

<p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt 4.0in;text-align:right;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Exhibit&nbsp;32</font></b></p>

<p align="right" style="letter-spacing:-.15pt;margin:0in 0in .0001pt 4.0in;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">CERTIFICATION PURSUANT TO</font></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">18 U.S.C. SECTION&nbsp;1350,</font></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">AS ADOPTED PURSUANT TO</font></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">SECTION&nbsp;906 OF THE SARBANES-OXLEY ACT OF 2002</font></p>

<p align="center" style="letter-spacing:-.15pt;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Pursuant
to 18 U.S.C. &#167;1350 (as adopted pursuant to &#167;906 of the Sarbanes-Oxley Act of
2002), the undersigned Chief Executive Officer and Controller of Appliance
Recycling Centers of America,&nbsp;Inc. (the &#147;Company&#148;) hereby certify that the
Quarterly Report on Form&nbsp;10-Q of the Company for the quarterly period
ended March&nbsp;29, 2008 (the &#147;Report&#148;) fully complies with the requirements of
section 13(a)&nbsp;or 15(d)&nbsp;of the Securities Exchange Act of 1934 and
that the information contained in the Report fairly presents, in all material
respects, the financial condition and results of operations of the Company.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;width:100.0%;">
 <tr>
  <td width="100%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:100.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Very
  truly yours,</font></p>
  </td>
 </tr>
 <tr>
  <td width="100%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:100.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="100%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:100.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="100%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:100.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Edward
  R. Cameron</font></p>
  </td>
 </tr>
 <tr>
  <td width="100%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:100.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="100%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:100.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="50%" valign="top" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in .7pt 0in .7pt;width:50.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">/s/Edward
  R. Cameron</font></p>
  </td>
  <td width="50%" valign="top" style="padding:0in .7pt 0in .7pt;width:50.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="100%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:100.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">President and Chief Executive Officer</font></p>
  </td>
 </tr>
 <tr>
  <td width="100%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:100.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="100%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:100.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="100%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:100.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Peter
  P. Hausback</font></p>
  </td>
 </tr>
 <tr>
  <td width="100%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:100.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="100%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:100.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="50%" valign="top" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in .7pt 0in .7pt;width:50.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">/s/Peter
  P. Hausback</font></p>
  </td>
  <td width="50%" valign="top" style="padding:0in .7pt 0in .7pt;width:50.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="100%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:100.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Executive Vice President and Chief Financial
  Officer</font></p>
  </td>
 </tr>
 <tr>
  <td width="100%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:100.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="100%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:100.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="100%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:100.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Patrick J. Winters</font></p>
  </td>
 </tr>
 <tr>
  <td width="100%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:100.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="100%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:100.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="50%" valign="top" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0in .7pt 0in .7pt;width:50.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">/s/Patrick J. Winters</font></p>
  </td>
  <td width="50%" valign="top" style="padding:0in .7pt 0in .7pt;width:50.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="100%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:100.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Controller
  (Principal Accounting Officer)</font></p>
  </td>
 </tr>
 <tr>
  <td width="100%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:100.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="100%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:100.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="100%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:100.0%;">
  <p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Date:
  May&nbsp; 13, 2008</font></p>
  </td>
 </tr>
</table>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<div style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><hr size="1" width="25%" noshade color="black" align="left"></div>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">* A signed original of this written statement required by Section&nbsp;906
has been provided to the Company and will be retained by the Company and
furnished to the Securities and Exchange Commission or its staff upon request.</font></p>

<p style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<div style="letter-spacing:-.15pt;margin:0in 0in .0001pt;"><hr size="3" width="100%" noshade color="#010101" align="left"></div>

</div>
<!-- SEQ.=1,FOLIO='',FILE='C:\JMS\pselva\08-11369-1\task2935272\11369-1-mg.htm',USER='105344',CD='May 13 06:21 2008' -->


</body>

</html>
</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
-----END PRIVACY-ENHANCED MESSAGE-----
