-----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,
 L8bxq+JIp3NwVrTCYvXPqqsLFCjEffgdp5tV1oeGDu6PqIbINlhdkIzD99X9foCx
 GMs0uY7MHvElEEF+bbF4gQ==

<SEC-DOCUMENT>0000006207-09-000001.txt : 20090312
<SEC-HEADER>0000006207-09-000001.hdr.sgml : 20090312
<ACCEPTANCE-DATETIME>20090312142335
ACCESSION NUMBER:		0000006207-09-000001
CONFORMED SUBMISSION TYPE:	10-Q
PUBLIC DOCUMENT COUNT:		4
CONFORMED PERIOD OF REPORT:	20090131
FILED AS OF DATE:		20090312
DATE AS OF CHANGE:		20090312

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			AMREP CORP.
		CENTRAL INDEX KEY:			0000006207
		STANDARD INDUSTRIAL CLASSIFICATION:	REAL ESTATE [6500]
		IRS NUMBER:				590936128
		STATE OF INCORPORATION:			OK
		FISCAL YEAR END:			0430

	FILING VALUES:
		FORM TYPE:		10-Q
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	001-04702
		FILM NUMBER:		09675238

	BUSINESS ADDRESS:	
		STREET 1:		300 ALEXANDER PARK
		STREET 2:		SUITE 204
		CITY:			PRINCETON
		STATE:			NJ
		ZIP:			08540
		BUSINESS PHONE:		(609) 716-8200

	MAIL ADDRESS:	
		STREET 1:		300 ALEXANDER PARK
		STREET 2:		SUITE 204
		CITY:			PRINCETON
		STATE:			NJ
		ZIP:			08540

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	AMREP CORP
		DATE OF NAME CHANGE:	19920703

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	AMERICAN REALTY & PETROLEUM CORP
		DATE OF NAME CHANGE:	19671019
</SEC-HEADER>
<DOCUMENT>
<TYPE>10-Q
<SEQUENCE>1
<FILENAME>axrq0309.txt
<TEXT>

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM 10-Q

            [ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
                       THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended                January 31, 2009
                               -------------------------------------------------

                                       OR

            [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
                       THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                         to
                               -----------------------   -----------------------

                          Commission File Number   1-4702
                                                 ----------

                                AMREP Corporation
- --------------------------------------------------------------------------------
             (Exact name of registrant as specified in its charter)

         Oklahoma                                             59-0936128
- --------------------------------------------------------------------------------
(State or other jurisdiction of                              (IRS Employer
incorporation or organization)                               Identification No.)

300 Alexander Park , Suite 204, Princeton, New Jersey              08540
- --------------------------------------------------------------------------------
(Address of principal executive offices)                          (Zip Code)

Registrant's telephone number, including area code           (609) 716-8200
                                                   -----------------------------

                                 Not Applicable
- --------------------------------------------------------------------------------
(Former name,former address and former fiscal year,if changed since last report)

Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding 12 months (or for such  shorter  period that the  Registrant  was
required  to file  such  reports),  and  (2) has  been  subject  to such  filing
requirements for the past 90 days.

                   Yes    X                            No
                       ------                             ------

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 "large  accelerated  filer,"  "accelerated  filer" and  "smaller
reporting company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer                       Accelerated filer          X
                        ---                                             ---

Non-accelerated filer                         Smaller reporting company
                        ---                                             ---
(Do not check if a smaller reporting company)



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

                   Yes                                 No    X
                       ------                             ------

Number of Shares of Common  Stock,  par value  $.10 per  share,  outstanding  at
February 28, 2009 - 5,996,212.
<PAGE>
                       AMREP CORPORATION AND SUBSIDIARIES

                                      INDEX
                                      -----


PART I.  FINANCIAL INFORMATION                                          PAGE NO.
                                                                        --------
Item 1.  Financial Statements

          Consolidated Balance Sheets (Unaudited)
           January 31, 2009 and April 30, 2008                              1

          Consolidated Statements of Operations and Retained Earnings
           (Unaudited) Three Months Ended January 31, 2009 and 2008         2

          Consolidated Statements of Operations and Retained Earnings
           (Unaudited) Nine Months Ended January 31, 2009 and 2008          3

          Consolidated Statements of Cash Flows
           (Unaudited) Nine Months Ended January 31, 2009 and 2008          4

          Notes to Consolidated Financial Statements (Unaudited)            5

Item 2.  Management's  Discussion and Analysis of Financial Condition
          and Results of Operations                                        13

Item 3.  Quantitative and Qualitative Disclosures About Market Risk        21

Item 4.  Controls and Procedures                                           21

PART II  OTHER INFORMATION

Item 1.  Legal Proceedings                                                 22

Item 1A. Risk Factors                                                      22

Item 6.  Exhibits                                                          23

SIGNATURE                                                                  24

EXHIBIT INDEX                                                              25

<PAGE>


                          PART I. FINANCIAL INFORMATION

Item 1. Financial Statements
- ------- --------------------

                       AMREP CORPORATION AND SUBSIDIARIES
                     Consolidated Balance Sheets (Unaudited)
               (Thousands, except par value and number of shares)
<TABLE>
<S>                                                                                <C>                   <C>


                                                                                      January 31,             April 30,
                                                                                          2009                  2008
                                                                                   ------------------    ------------------
ASSETS:
Cash and cash equivalents                                                          $      18,347         $        32,608
Restricted cash                                                                            3,856                       -
Receivables, net:
  Real estate operations                                                                   4,064                  13,124
  Media services operations                                                               50,059                  45,701
                                                                                   ------------------    ------------------
                                                                                          54,123                  58,825

Taxes receivable                                                                           1,487                       -
Real estate inventory                                                                     81,817                  70,252
Investment assets, net                                                                    11,394                  10,300
Property, plant and equipment, net                                                        32,500                  28,914
Intangible and other assets, net                                                          27,182                  29,913
Goodwill                                                                                  54,139                  54,139
                                                                                   ------------------    ------------------
  TOTAL ASSETS                                                                     $     284,845         $       284,951
                                                                                   ==================    ==================

LIABILITIES AND SHAREHOLDERS' EQUITY:
LIABILITIES:
Accounts payable, net and accrued expenses                                         $      77,850         $        98,532
Notes payable:
  Amounts due within one year                                                             27,029                   4,816
  Amounts subsequently due                                                                15,366                  21,164
                                                                                   ------------------    ------------------
                                                                                          42,395                  25,980

Taxes payable                                                                                  -                     980
Deferred income taxes and other long-term liabilities                                     14,653                  12,358
Accrued pension cost                                                                       2,010                   2,045
                                                                                   ------------------    ------------------
  TOTAL LIABILITIES                                                                      136,908                 139,895
                                                                                   ------------------    ------------------

SHAREHOLDERS' EQUITY:
Common stock, $.10 par value;
  Shares authorized - 20,000,000; 7,420,704 shares issued at
  January 31, 2009 and 7,419,704 at April 30, 2008                                           742                     742
Capital contributed in excess of par value                                                46,100                  46,085
Retained earnings                                                                        131,274                 128,408
Accumulated other comprehensive loss, net                                                 (3,522)                 (3,522)
Treasury stock, at cost; 1,424,492 shares                                                (26,657)                (26,657)
                                                                                   ------------------    ------------------
  TOTAL SHAREHOLDERS' EQUITY                                                             147,937                 145,056
                                                                                   ------------------    ------------------
  TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY                                       $     284,845         $       284,951
                                                                                   ==================    ==================

</TABLE>


                                       1
<PAGE>

                       AMREP CORPORATION AND SUBSIDIARIES
     Consolidated Statements of Operations and Retained Earnings (Unaudited)
                  Three Months Ended January 31, 2009 and 2008
                      (Thousands, except per share amounts)
<TABLE>
<S>                                                                                <C>                   <C>

                                                                                          2009                  2008
                                                                                   ------------------    ------------------
REVENUES:
Real estate land sales                                                             $         521         $         6,302
Media services operations                                                                 35,051                  36,458
Interest and other                                                                           148                     675
                                                                                   ------------------    ------------------
                                                                                          35,720                  43,435
                                                                                   ------------------    ------------------
COSTS AND EXPENSES:
Cost of sales - real estate land sales                                                       333                   2,332
Operating expenses:
  Media services operations                                                               30,874                  30,492
  Real estate commissions and selling                                                         79                     300
  Other                                                                                      465                    (305)
General and administrative:
  Media services operations                                                                3,545                   3,228
  Real estate operations and corporate                                                     1,182                   1,259
Restructuring and fire recovery costs, net                                                   (83)                    387
Interest expense, net of capitalized amounts                                                 222                     274
                                                                                   ------------------    ------------------
                                                                                          36,617                  37,967
                                                                                   ------------------    ------------------
INCOME (LOSS) BEFORE INCOME TAXES                                                           (897)                  5,468

PROVISION (BENEFIT) FOR INCOME TAXES                                                        (797)                  2,022
                                                                                   ------------------    ------------------
NET INCOME (LOSS)                                                                           (100)                  3,446

RETAINED EARNINGS, beginning of period                                                   131,374                 124,433
                                                                                   ------------------    ------------------
RETAINED EARNINGS, end of period                                                   $     131,274          $      127,879
                                                                                   ==================    ==================

EARNINGS (LOSS) PER SHARE - BASIC AND DILUTED                                      $       (0.02)         $         0.57
                                                                                   ==================    ==================

WEIGHTED AVERAGE NUMBER OF COMMON
  SHARES OUTSTANDING                                                                       5,996                   6,014
                                                                                   ==================    ==================

</TABLE>



                                       2
<PAGE>

                       AMREP CORPORATION AND SUBSIDIARIES
     Consolidated Statements of Operations and Retained Earnings (Unaudited)
                   Nine Months Ended January 31, 2009 and 2008
                      (Thousands, except per share amounts)
<TABLE>
<S>                                                                                <C>                   <C>

                                                                                          2009                  2008
                                                                                    ------------------    ------------------
REVENUES:
Real estate land sales                                                             $       6,594         $        27,613
Media services operations                                                                104,328                 104,317
Interest and other                                                                           658                   4,955
                                                                                   ------------------    ------------------
                                                                                         111,580                 136,885
                                                                                   ------------------    ------------------
COSTS AND EXPENSES:
Cost of sales - real estate land sales                                                       853                   9,663
Operating expenses:
  Media services operations                                                               91,324                  90,237
  Real estate commissions and selling                                                        248                     641
  Other                                                                                      999                     620
General and administrative:
  Media services operations                                                                9,825                   9,568
  Real estate operations and corporate                                                     3,257                   3,447
Restructuring and fire recovery costs, net                                                   629                     807
Interest expense, net of capitalized amounts                                                 481                     899
                                                                                   ------------------    ------------------
                                                                                         107,616                 115,882
                                                                                   ------------------    ------------------
INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES                                      3,964                  21,003

PROVISION FOR INCOME TAXES FROM CONTINUING OPERATIONS                                      1,098                   7,770
                                                                                   ------------------    ------------------
INCOME FROM CONTINUING OPERATIONS                                                          2,866                  13,233
LOSS FROM OPERATIONS OF DISCONTINUED BUSINESS (NET OF INCOME TAXES)                            -                     (57)
                                                                                    ------------------    ------------------
NET INCOME                                                                                 2,866                  13,176
RETAINED EARNINGS, beginning of period                                                   128,408                 121,333
DIVIDENDS PAID                                                                                 -                  (6,630)
                                                                                    ------------------    ------------------
RETAINED EARNINGS, end of period                                                   $     131,274         $       127,879
                                                                                    ==================    ==================

EARNINGS (LOSS) PER SHARE - BASIC AND DILUTED
  CONTINUING OPERATIONS                                                            $        0.48         $          2.09
  DISCONTINUED OPERATIONS                                                                      -                   (0.01)
                                                                                   ------------------    ------------------
EARNINGS PER SHARE - BASIC AND DILUTED                                             $        0.48         $          2.08
                                                                                   ==================    ==================

WEIGHTED AVERAGE NUMBER OF COMMON
  SHARES OUTSTANDING                                                                       5,996                   6,332
                                                                                   ==================    ==================

</TABLE>


                                       3
<PAGE>

                       AMREP CORPORATION AND SUBSIDIARIES
                Consolidated Statements of Cash Flows (Unaudited)
                   Nine Months Ended January 31, 2009 and 2008
                                   (Thousands)
<TABLE>
<S>                                                                                <C>                   <C>

                                                                                          2009                  2008
                                                                                   ------------------    ------------------
CASH FLOWS FROM OPERATING ACTIVITIES:
 Net income                                                                        $       2,866            $     13,176
 Adjustments to reconcile net income to net cash provided by
 operating activities:
  Depreciation and amortization                                                            7,644                   8,014
  Non-cash credits and charges:
   Pension benefit                                                                           (35)                   (246)
   Allowance for doubtful accounts                                                           190                    (349)
(Gain) loss on disposition of assets, net                                                     59                  (1,781)
Changes in assets and liabilities:
   Receivables                                                                            (1,459)                  3,184
   Real estate inventory                                                                  (5,020)                (15,940)
   Intangible and other assets                                                              (196)                 (1,152)
   Accounts payable and accrued expenses                                                 (21,369)                  4,944
   Taxes payable                                                                          (2,467)                  2,053
   Deferred income taxes and other long-term liabilities                                   2,295                   3,236
                                                                                   ------------------    ------------------
    Total adjustments                                                                    (20,358)                  1,963
                                                                                    ------------------    ------------------
    Net cash provided by (used in) operating activities                                  (17,492)                 15,139
                                                                                    ------------------    ------------------
CASH FLOWS FROM INVESTING ACTIVITIES:

 Capital expenditures - property, plant and equipment                                     (1,521)                 (4,565)
 Capital expenditures - investment assets                                                      -                  (1,097)
 Acquisition, net of cash acquired                                                        (3,075)                    195
 Proceeds from disposition of assets                                                           -                   4,749
 Restricted cash                                                                          (3,856)                      -
                                                                                   ------------------    ------------------
    Net cash used in investing activities                                                 (8,452)                   (718)
                                                                                   ------------------    ------------------
CASH FLOWS FROM FINANCING ACTIVITIES:
  Acquisition of treasury stock                                                                -                 (21,363)
  Exercise of stock options                                                                   15                       -
  Proceeds from debt financing                                                            51,137                  71,081
  Principal debt payments                                                                (39,469)                (74,683)
  Dividends paid                                                                               -                  (6,630)
                                                                                    ------------------    ------------------
    Net cash provided by (used in) financing activities                                   11,683                 (31,595)
                                                                                   ------------------    ------------------
DECREASE IN CASH AND CASH EQUIVALENTS                                                    (14,261)                (17,174)
CASH AND CASH EQUIVALENTS, beginning of period                                            32,608                  42,102
                                                                                   ------------------    ------------------

CASH AND CASH EQUIVALENTS, end of period                                           $      18,347         $        24,928
                                                                                   ==================    ==================

SUPPLEMENTAL CASH FLOW INFORMATION:
 Interest paid - net of amounts capitalized                                        $         458         $         1,029
                                                                                   ==================    ==================
 Income taxes paid - net of refunds                                                $       1,834         $         2,447
                                                                                   ==================    ==================
 Non-cash transactions:
  Transfer to real estate inventory from receivables                               $       6,530         $         3,892
                                                                                   ==================    ==================
  Transfer to real estate investment assets from receivables                       $       1,125         $             -
                                                                                   ==================    ==================
</TABLE>

                                       4
<PAGE>

                       AMREP CORPORATION AND SUBSIDIARIES
             Notes to Consolidated Financial Statements (Unaudited)
                   Nine Months Ended January 31, 2009 and 2008

(1) Basis of Presentation
    ---------------------

The accompanying  unaudited consolidated financial statements have been prepared
by AMREP Corporation (the  "Registrant" or the "Company")  pursuant to the rules
and regulations of the Securities and Exchange  Commission for interim financial
information,  and do not include all the information  and footnotes  required by
accounting  principles  generally  accepted in the United  States of America for
complete  financial  statements.  In the opinion of management,  these unaudited
consolidated financial statements include all adjustments, which are of a normal
recurring  nature,  necessary to reflect a fair  presentation of the results for
the interim  periods  presented.  The  results of  operations  for such  interim
periods are not necessarily indicative of what may occur in future periods.

The  unaudited  consolidated  financial  statements  herein  should  be  read in
conjunction  with the  Company's  annual  report on Form 10-K for the year ended
April 30, 2008,  which was  previously  filed with the  Securities  and Exchange
Commission. All references to the third quarter or first nine months of 2009 and
2008 mean the fiscal  three and nine month  periods  ended  January 31, 2009 and
2008.

Certain 2008 financial  statement  amounts have been  reclassified to conform to
the current year presentation.

(2) Restricted Cash
    ---------------

Restricted cash of $3,856,000 reflects amounts held in escrow that were received
in connection  with the sale of investment  assets that are  identified as "1031
Exchange  assets" and which are  restricted  pending the purchase of  identified
replacement assets.

(3) Receivables, Net
    ----------------

Accounts receivable, net consist of the following (in thousands):

                                              January 31,           April 30,
                                                  2009                2008
                                            ---------------    -----------------
Real estate operations:
  Mortgage notes and other receivables        $    4,166         $    13,236
  Less allowance for doubtful accounts              (102)               (112)
                                            ---------------    -----------------
                                              $    4,064         $    13,124
                                            ===============    =================
Media Services operations:
  Subscription Fulfillment Services               29,381              27,915
  Newsstand Distribution Services,
    net of estimated returns                      18,997              18,008
  Product Fulfillment Services and other           2,596                 433
                                             ---------------   -----------------
                                                  50,974              46,356
  Less allowance for doubtful accounts              (915)               (655)
                                            ---------------    -----------------
                                              $   50,059         $    45,701
                                            ===============    =================

Real estate operations  mortgage notes and other receivables have decreased from
April  30,  2008,   primarily  due  to  the  reclassification  of  approximately
$6,530,000  to real estate  inventory and  $1,125,000 to investment  assets from


                                       5
<PAGE>

mortgage notes  receivable  resulting from the Company's  acceptance of deeds in
lieu of foreclosure related to delinquent mortgage note receivables.

Newsstand  Distribution  Services  accounts  receivable  are  net  of  estimated
magazine returns of $55,154,000 at January 31, 2009 and $55,930,000 at April 30,
2008. In addition, pursuant to an arrangement with one publisher customer of the
Newsstand  Distribution  Services  business,  the  publisher  bears the ultimate
credit risk of  non-collection  of amounts due from the wholesaler  customers to
which the Company distributed the publisher's  magazines under this arrangement.
Accounts  receivable  subject to this arrangement  were netted  ($29,662,000 was
netted at January  31,  2009 and  $22,703,000  at April 30,  2008)  against  the
related  accounts  payable due the  publisher on the  accompanying  consolidated
balance sheets.

At January 31, 2009, net accounts receivable of Newsstand  Distribution Services
includes  approximately  $7,500,000  from a wholesaler  customer that  suspended
normal business activities in February, which amount is subject to adjustment by
magazine  return  activity  subsequent to the end of the quarter that may differ
from the  Company's  estimates.  No payments of  accounts  receivable  have been
received by the Company from this customer  after January 31, 2009.  Because the
amount of  potential  loss on amounts due from this  wholesaler  is unable to be
estimated,   the   Company   has  not   provided   a  specific   allowance   for
uncollectibility,  but it  continues  to monitor the  collectibility  of the net
receivable  and  will  provide  an  appropriate  allowance  if and  when  deemed
necessary (see Note 14).

(4) Investment Assets, Net
    ----------------------

Investment assets, net consist of the following (in thousands):

                                               January 31,           April 30,
                                                 2009                  2008
                                            ---------------    -----------------
Land held for long-term investment            $   10,880         $     9,771
                                            ---------------    -----------------
Commercial rental properties:
  Land, buildings and improvements                   754                 754
  Furniture and fixtures                              40                  40
                                            ---------------    -----------------
                                                     794                 794
  Less accumulated depreciation                     (280)               (265)
                                            ---------------    -----------------
                                                     514                 529
                                            ---------------    -----------------
                                              $   11,394         $    10,300
                                            ===============    =================

(5) Property, Plant and Equipment, Net
    ----------------------------------

Property, plant and equipment, net consist of the following (in thousands):

                                               January 31,           April 30,
                                                 2009                  2008
                                            ---------------    -----------------
Land, buildings and improvements              $   24,640         $    17,875
Furniture and equipment and other                 46,521              45,300
                                            ---------------    -----------------
                                                  71,161              63,175
Less accumulated depreciation                    (38,661)            (34,261)
                                            ---------------    -----------------
                                              $   32,500         $    28,914
                                            ===============    =================


The increase in Land,  buildings and  improvements is primarily  attributable to
the purchase of a warehouse in November 2008 (see Note 13).



                                       6
<PAGE>



(6) Intangible and Other Assets, Net
    --------------------------------

Intangible and other assets, net consist of the following (in thousands):
<TABLE>
<S>                                         <C>                                       <C>

                                                      January 31, 2009                          April 30, 2008
                                             ------------------------------------     -----------------------------------
                                                                   Accumulated                              Accumulated
                                                 Cost             Amortization            Cost             Amortization
                                             --------------      ----------------     -------------      ----------------

Software development costs                   $    10,143         $      5,583         $    10,017        $      3,780
Deferred order entry costs                         5,183                    -               5,681                   -
Prepaid expenses                                   3,394                    -               3,047                   -
Customer contracts and relationships              15,000                2,551              15,000               1,613
Other                                              2,694                1,098               2,430                 869
                                             --------------      ----------------     -------------      ----------------
                                             $    36,414         $      9,232         $    36,175        $      6,262
                                             ==============      ================     =============      ================
</TABLE>

Software   development   costs  include  internal  and  external  costs  of  the
development  of new or enhanced  software  programs and are generally  amortized
over five  years.  Deferred  order  entry  costs  represent  costs  incurred  in
connection with the data entry of customer subscription  information to database
files  and are  charged  directly  to  operations  over a twelve  month  period.
Customer contracts and relationships are amortized over twelve years.

(7) Accounts Payable, Net and Accrued Expenses
    ------------------------------------------

Accounts  payable,  net  and  accrued  expenses  consist  of the  following  (in
thousands):
                                             January 31,            April 30,
                                                 2009                 2008
                                          -----------------     ----------------
Publisher payables, net                     $    59,606           $    77,003
Accrued expenses                                  4,261                 5,000
Trade payables                                    3,917                 5,753
Other                                            10,066                10,776
                                          -----------------     ----------------
                                            $    77,850           $    98,532
                                          =================     ================


As described in Note 3, pursuant to the arrangement with one publisher  customer
of the  Newsstand  Distribution  Services  business,  the  publisher  bears  the
ultimate  credit risk of  non-collection  of amounts due from the  customers  to
which the Company distributed the publisher's  magazines under this arrangement.
Accounts  receivable  subject to this arrangement  were netted  ($29,662,000 was
netted at January  31,  2009 and  $22,703,000  at April 30,  2008)  against  the
related  accounts  payable due the  publisher on the  accompanying  consolidated
balance sheets.






                                       7
<PAGE>

(8) Notes Payable
    -------------

Notes payable consist of the following (in thousands):

                                             January 31,            April 30,
                                                2009                  2008
                                          -----------------     ----------------
Notes payable:
 Line-of-credit borrowings:
   Real estate operations                   $    25,000           $    18,000
   Media services operations                     12,243                 4,582
 Real estate operations term loan                    -                  2,774
 Other notes payable                              5,152                   624
                                          -----------------     ----------------
                                            $    42,395           $    25,980
                                          =================     ================

The increase in Other notes payable is due to the  assumption of a mortgage note
payable in  connection  with the purchase of a warehouse  in November  2008 (see
Note 13).

(9) Taxes
    -----

The Company  recognized  a net tax  benefit of  $797,000  during the three month
period ended January 31, 2009,  primarily  resulting from a pre-tax loss for the
quarter of $897,000 and a reduction in liabilities  related to unrecognized  tax
benefits pursuant to Financial  Accounting Standards Board Interpretation No. 48
("FIN 48"),  "Accounting  for  Uncertainty  in Income  Taxes".  The  liabilities
related to unrecognized  tax benefits that would have an impact on the effective
tax rate were $1,585,000 at January 31, 2009 and $2,076,000 at April 30, 2008.

(10) Fair Value Measurements
     -----------------------

In  September 2006,  the Financial  Accounting  Standards  Board ("FASB") issued
Statement  of  Financial  Accounting  Standards  ("SFAS")  No. 157,  "Fair Value
Measurements". SFAS No. 157 establishes a common definition for fair value to be
applied to U.S. GAAP  requiring  use of fair value,  establishes a framework for
measuring fair value and expands disclosure about such fair value  measurements.
SFAS No. 157 is effective for financial  assets and  financial  liabilities  for
fiscal years beginning after  November 15,  2007. The Company's adoption of SFAS
No. 157 for financial assets and financial  liabilities,  effective May 1, 2008,
did not have an impact on its  consolidated  financial  position  or  results of
operations.

In February  2007,  the FASB issued  SFAS No.  159,  "The Fair Value  Option for
Financial  Assets and  Financial  Liabilities  - Including  an Amendment of FASB
Statement  No.  115,  Accounting  for  Certain  Investments  in Debt and  Equity
Securities".  SFAS  No. 159 permits  entities to choose,  at specified  election
dates,  to measure many  financial  instruments  and certain other items at fair
value  that are not  currently  measured  at fair  value.  Unrealized  gains and
losses on items  for  which the fair  value  option  has been  elected  would be
reported in  earnings  at each  subsequent  reporting  date.  SFAS  No. 159 also
establishes  presentation  and  disclosure  requirements  in order to facilitate
comparisons  between  entities  choosing  different  measurement  attributes for
similar types of assets and  liabilities.  SFAS No. 159 does not affect existing
accounting requirements for certain assets and liabilities to be carried at fair
value.  SFAS  No. 159 became effective for fiscal years beginning after November
15, 2007, and interim  periods within those fiscal  years.  The  Company adopted
SFAS No. 159  effective  May 1, 2008,  but it has not  designated  any financial
instruments to be subject to the fair value option.


                                       8
<PAGE>

(11) Discontinued Operations
     -----------------------

Loss from operations of discontinued  business (net of income taxes) in the nine
month  period  ended  January  31,  2008  reflected  costs  associated  with the
settlement  of all  litigation  related to the  Company's El Dorado,  New Mexico
former  water  utility  subsidiary  that were in addition to costs that had been
accrued for this matter in prior years.

(12) Restructuring and Fire Recovery Costs
     -------------------------------------

In  January  2008,  the  Company  announced  a  project  to unify  its  magazine
subscription,  membership  and  direct  mail  fulfillment  services  from  three
locations  into one  location  at Palm  Coast,  Florida,  which is  expected  to
streamline  operations,  improve service to clients and create cost efficiencies
through reduced  overhead costs and the  elimination of operating  redundancies.
The Company is still evaluating various  alternatives for this expansion,  which
could require  capital  expenditures in the range of $15,000,000 to $20,000,000.
The project is scheduled to be implemented over a two-to-three year period,  and
over that period may involve  approximately  $6,000,000  of  non-recurring  cash
costs for severance,  training and transition,  facility  closings and equipment
relocation.  The State of  Florida  and the City of Palm  Coast  have  agreed to
provide incentives for the project,  including cash and employee training grants
and tax relief, which could amount to as much as $8,000,000,  largely contingent
on existing job retention,  new job creation and capital investment.  Previously
during  fiscal  2008,  the  Company  announced  (i)  one  significant  workforce
reduction in its Subscription Fulfillment Services business that occurred in the
third quarter of fiscal 2008, (ii) a plan to redistribute  the work performed at
the Marion, Ohio facility of its Fulfillment Services business and the scheduled
closing of that facility that was  substantially  completed in August 2008,  and
(iii) the consolidation of fulfillment operations customer call centers.  During
the quarter ended January 31, 2009,  the Company  recognized  $175,000 of income
for certain incentives related to the unification project, which are netted with
costs of  $169,000.  As a  result,  the  Company  reported  a net gain of $6,000
related to the unification project in the third quarter of 2009 and incurred net
costs of  $567,000  for the first nine  months of 2009  compared to net costs of
$136,000 and $556,000 for the same periods of 2008,  principally  for  severance
and  consulting  costs.  The items of income  related  to  incentives  and costs
related to the  unification  project  are  included  in  Restructuring  and fire
recovery  costs in the  Company's  consolidated  statements  of  operations  and
retained earnings.

On December 5, 2007, a warehouse of  approximately  38,000 square feet leased by
the Company's  Kable News Company,  Inc.  subsidiary  ("Kable  News") in Oregon,
Illinois was totally  destroyed by fire.  The warehouse was used  principally to
store back  issues of  magazines  published  by certain  customers  for whom the
Company  filled  back-issue  orders as part of its  services.  The  Company  was
required to provide  insurance for certain of those customers whose property was
destroyed in the  warehouse  fire.  Through  February 28,  2009,  the  Company's
insurance  carrier  had  paid  approximately  $211,000  to  customers  for  lost
materials.  Subject  to the  outcome  of the  lawsuit  referred  to in the final
paragraph  of this Note 12,  the  Company  believes  that the net  effect of the
outcome of other  pending or unasserted  claims  related to materials of certain
publishers for whom it was required to provide insurance, together with proceeds
from its  property  claims,  will not have a  material  effect on its  financial
position, results of operations or cash flows.

The Company has filed a preliminary  claim with its  insurance  provider for its
property  loss as a  result  of the  fire and has  been  advanced  $500,000  for
replacement  of such  property.  During the quarter ended January 31, 2009,  the
Company  replaced a portion of the fixed assets lost in the  warehouse  fire and
recorded a $134,000 gain resulting from the  recognition of insurance  proceeds,
which is netted  against  costs  related to the fire.  As a result,  the Company
reported  a net  gain of  $77,000  for the  third  quarter  and net  charges  to
operations of $62,000 for the first nine months of 2009 related to fire recovery
costs,  principally  for legal and other advisory costs that were not covered by
insurance.  The  item of  income  related  to  insurance  proceeds  and the fire
recovery  costs are included in  Restructuring  and fire  recovery  costs in the
Company's consolidated statements of operations and retained earnings. In


                                       9
<PAGE>

addition,  the Company recorded $173,000 of other income in the first quarter of
2009  for a  business  interruption  claim  resulting  from  the  fire,  and has
approximately  $140,000 of business  interruption  claims  pending  with but not
approved by its insurance provider.

In June  2008,  a lawsuit  was  brought  against  Kable News by the owner of the
warehouse  building leased by the subsidiary  that was totally  destroyed in the
fire. A temporary staffing company that provided the subsidiary with an employee
who is alleged to have had a role in causing the fire while operating a forklift
is also named as a  defendant.  Plaintiff's  claims  specific  to Kable News are
based on  allegations  of  negligence  and  willful and wanton  misconduct.  The
Company's  liability  insurance provides coverage for the negligence claim up to
the  policy  limit,  which  may or may  not be as  much as the  full  amount  of
plaintiff's claimed damages,  which is unknown at this time.  Additionally,  the
insurance  carrier has  indicated it intends to deny coverage of the willful and
wanton  misconduct  claim.  A summary  judgment  motion brought by the temporary
staffing company defendant has been denied.  The Company believes Kable News has
good  defenses  to the claims and also has  potential  cross-claims  against the
other parties for their conduct in the matter, and Kable News intends vigorously
to defend the lawsuit.  However,  the proceeding  remains at an early stage, and
the Company is not in a position to predict its outcome.

In  November  2008,  a lawsuit  was  brought  against  Kable  News by a magazine
publisher and a number of insurance companies as the subrogees of other magazine
publishers whose property stored by Kable News in the warehouse was destroyed in
the fire.  The three  defendants  are the  warehouse  owner,  Kable News and the
temporary  staffing company that provided an employee who is alleged to have had
a role in causing the fire.  Plaintiffs' claims specific to Kable News are based
on  allegations  of  negligence,  breach of  contract  and  willful  and  wanton
misconduct.  The complaint  seeks damages in an amount in excess of  $1,000,000.
The Company  believes  that Kable News has good  defenses to the claims and also
has potential cross-claims against the other defendants for their conduct in the
matter, and intends vigorously to defend the lawsuit. However, the proceeding is
at a very early  stage,  and the  Company is not in a  position  to predict  its
outcome.

(13) Acquisitions
     ------------

On November 7, 2008, the Company announced the purchase,  through a newly-formed
subsidiary of Kable Media  Services,  Inc.,  of certain  assets of Service Parts
Supply  Corp.   ("SPS"),  a  privately-held   company  engaged  in  the  product
repackaging and fulfillment  industry located in Fairfield,  Ohio. In a separate
transaction,  another Company  subsidiary  purchased a warehouse  leased by SPS.
These  transactions are expected to provide benefits to many of the customers of
the Company's  product  fulfillment  subsidiary  through the combination of that
subsidiary's  services  with those to be provided with the purchased SPS assets.
Lastly,  on the same  date,  another  newly-formed  subsidiary  of  Kable  Media
Services,  Inc.  purchased  certain  assets of  Resource  One  Staffing,  LLC, a
provider of temporary  staffing  services  that was  majority-owned  by the same
individual who owned SPS. The aggregate  purchase price of the assets  purchased
in the three  transactions was approximately  $8,500,000,  and was financed from
working  capital,  bank  borrowings and the assumption of a mortgage note on the
warehouse.  The transactions have been accounted for as a business  combination.
The purchase  price  (including  closing costs and excluding  cash acquired) has
been preliminarily allocated as follows:  Receivables - $1,565,000;  Inventory -
$118,000;  Property,  plant and equipment - $6,826,000;  Mortgage note payable -
$4,747,000, and Other liabilities - $687,000.

(14) Subsequent Events
     -----------------

In January 2009,  Anderson News, LLC ("ANCO"),  a major  wholesaler of magazines
for retail  distribution and a major Newsstand  Distribution  Services customer,
announced a significant  price  surcharge and  substantive  changes to inventory


                                       10
<PAGE>

risk  practices  effective  February 1, 2009 and advised that it would no longer
distribute  publishers'  magazines if the publisher did not agree to the revised
policies.  Shortly  thereafter,  Source  Interlink  Distribution,  LLC  ("SID"),
another major wholesaler and Newsstand Distribution Services customer, announced
that it also was  imposing  the  price  surcharge.  ANCO and SID  accounted  for
approximately  50% of nationwide  magazine retail  distribution.  In response to
these announcements,  many publishers and national  distributors,  including the
Company's Kable Distribution Services,  Inc. ("KDS") subsidiary,  which operates
the Newsstand  Distribution  Services business,  suspended shipments to ANCO and
SID and made  alternative  distribution  arrangements,  principally with the two
other major industry wholesalers.

On February 7, 2009,  ANCO announced that it planned to suspend normal  business
activities,  which  occurred on February 16, 2009. On February 19, 2009, KDS was
informed that ANCO was in the process of an orderly  liquidation and that it was
in default of its  extensively  secured bank loan.  On March 2, five  publishers
filed an  involuntary  bankruptcy  petition  against ANCO under chapter 7 of the
U.S. Bankruptcy Code seeking to have ANCO declared bankrupt and liquidated,  but
no decision on this petition has yet been announced by the Bankruptcy  Court. At
January  31,  2009,  KDS had  estimated  net  accounts  receivable  from ANCO of
approximately  $7,500,000,  which  amount is subject to  adjustment  by magazine
return  activity  subsequent  to the end of the quarter that may differ from the
Company's  estimates.  No payments of accounts  receivable have been received by
KDS from ANCO after  January 31, 2009.  As the amount,  if any, of ANCO's assets
that may be available for payment to ANCO's unsecured creditors,  including KDS,
is presently unable to be estimated,  no allowance for  uncollectibility of this
account  receivable  has yet been  established,  but the Company  believes it is
possible that a significant amount of the ANCO account receivable may ultimately
be  determined to be  uncollectible,  that such  determination  could be made as
early as during the Company's  current fiscal quarter ending April 30, 2009, and
that the effect of this  determination on Kable's  financial results could be to
place Kable (including its  subsidiaries) in default of its credit facility.  If
Kable is unable to obtain a waiver  for any  event of  default  on  satisfactory
terms,  Kable  (including  its  subsidiaries)  would not be able to borrow funds
under the credit facility until the non-compliance is cured and the lender would
be  permitted  to  exercise a number of  remedies,  including  the right to seek
immediate repayment of all outstanding loans.

On February 9, 2009, SID brought a lawsuit  against KDS,  certain other national
distributors, two of the major wholesalers and certain major publishers in which
it alleged that the magazine  publishers and  distributors  conspired to boycott
SID to drive it out of business,  and that the wholesalers  participated in this
effort.  It has asserted  claims under Section 1 of the Sherman Act  (antitrust)
for defamation and for tortious  interference with its contracts with retailers.
Damages have not been  quantified.  SID requested a preliminary  injunction  and
obtained a  temporary  restraining  order  which  required  the  publishers  and
distributors  to  continue to ship  magazines  to SID pending the hearing on the
preliminary injunction motion. On February 18, 2009, SID settled with one of the
publishers  and  advised  the Court that it would no longer  seek a  preliminary
injunction.  Accordingly,  the  temporary  restraining  order  was  vacated.  On
February 27, 2009,  SID  announced  it had settled with another  publisher.  The
remaining  defendants,  including  KDS,  have moved to dismiss the lawsuit.  The
Company believes that KDS has good defenses to the claims and intends vigorously
to defend the lawsuit. In view of the very early stage of this case, the Company
is not in a position to predict its outcome. In the meantime,  KDS is continuing
to ship product to SID without the surcharge.

On March 10, 2009,  ANCO  commenced a civil action  against KDS and others.  The
complaint contains allegations substantially similar to those made by SID.

As a result of the  disruption  to the magazine  distribution  system  described
above, there has been an adverse effect on commission  revenues in the Newsstand
Distribution Services business that is continuing,  and at this time the Company
is not able to quantify the effect of this disruption on its financial condition
and results of operations.

(15) Information About the Company's Operations in Different Industry Segments
    --------------------------------------------------------------------------

As a result of the  purchase of assets of certain  businesses  in November  2008
(see Note 13), the Company reclassified for both 2009 and 2008 certain revenues,
expenses  and  capital   expenditures   previously   reported  as  part  of  its
Subscription  Fulfillment  Services segment and has reported them with revenues,
expenses and capital expenditures of those businesses since the date of purchase
as a separate segment,  "Product  Fulfillment Services and Other". The following
tables  set  forth  summarized  data  relative  to  the  industry  segments  for
continuing operations in which the Company operated for the three and nine month
periods ended January 31, 2009 and 2008 (in thousands):

                                       11
<PAGE>

<TABLE>
<S>                                          <C>            <C>            <C>                <C>           <C>        <C>
                                                                                               Product
                                                            Subscription     Newsstand       Fulfillment
                                             Real Estate     Fulfillment    Distribution    Services and    Corporate
                                              Operations      Services        Services           Other      and Other  Consolidated
- ------------------------------------------------------------------------------------------------------------------------------------
Three months ended January 31, 2009:
Revenues                                      $      656     $   28,998     $     2,923      $     3,130     $     13    $  35,720

Income (loss) from continuing operations              96           (540)             29              140          175         (100)
Provision (benefit) for income taxes from
  continuing operations                           (1,026)           (40)             32               74          163         (797)
                                              --------------- -------------- -------------- --------------- ------------ -----------
Income (loss) from continuing operations
  before income taxes                               (930)          (580)             61              214          338         (897)
Interest expense (income), net (b)                    24            619            (223)              16         (214)         222
Depreciation and amortization                         10          2,610             149               19           37        2,825
                                              --------------- -------------- -------------- --------------- ------------ -----------
EBITDA (c)                                    $     (896)    $    2,649     $       (13)     $       249     $    161    $   2,150
                                              --------------- -------------- -------------- --------------- ------------ -----------

Capital expenditures                          $        -     $      730     $         -      $       134     $  6,498    $   7,362

- ------------------------------------------------------------------------------------------------------------------------------------
Three months ended January 31, 2008 (a):
Revenues                                      $    6,943     $   32,645     $     2,944      $       892     $     11    $  43,435

Income (loss) from continuing operations           2,440            622             151             (106)         339        3,446
Provision for income taxes from continuing
  operations                                       1,433            303              89                -          197        2,022
                                              --------------- -------------- -------------- --------------- ------------ -----------
Income (loss) from continuing operations
  before income taxes                              3,873            925             240             (106)         536        5,468
Interest expense (income), net (b)                     -          1,236            (346)               -         (616)         274
Depreciation and amortization                          9          2,404             246               10            2        2,671
                                              --------------- -------------- -------------- --------------- ------------ -----------
EBITDA (c)                                    $    3,882      $   4,565     $       140      $       (96)    $    (78)   $   8,413
                                              --------------- -------------- -------------- --------------- ------------ -----------

Capital expenditures                          $       26      $   1,544     $        74      $         -     $      -    $   1,644

- ------------------------------------------------------------------------------------------------------------------------------------

                                                                                                Product
                                                            Subscription     Newsstand       Fulfillment
                                             Real Estate     Fulfillment    Distribution    Services and    Corporate
                                              Operations      Services        Services           Other      and Other  Consolidated
- ------------------------------------------------------------------------------------------------------------------------------------
Nine months ended January 31, 2009:
Revenues                                      $    7,186     $   90,175     $     9,374      $     4,779     $     66    $ 111,580

Income (loss) from continuing operations           2,556         (1,349)            609              226          824        2,866
Provision (benefit) for income taxes from
  continuing operations                              566           (515)            445              124          478        1,098
                                              --------------- -------------- -------------- --------------- ------------ -----------
Income (loss) from continuing operations
  before income taxes                              3,122         (1,864)          1,054              350        1,302        3,964
Interest expense (income), net (b)                    24          2,300            (841)              16       (1,018)         481
Depreciation and amortization                         30          7,103             434               37           40        7,644
                                              --------------- -------------- -------------- --------------- ------------ -----------
EBITDA (c)                                    $    3,176     $    7,539     $       647      $       403     $    324    $  12,089
                                              --------------- -------------- -------------- --------------- ------------ -----------

Capital expenditures                          $        8     $    1,371     $        10      $       134     $  6,499    $   8,022

- ------------------------------------------------------------------------------------------------------------------------------------
Nine months ended January 31, 2008 (a):
Revenues                                      $   32,234     $   92,111     $     9,811      $     2,449     $    280    $ 136,885

Income (loss) from continuing operations          12,167         (1,318)            954              114        1,316       13,233
Provision (benefit) for income taxes from
  continuing operations                            7,145           (705)            557                -          773        7,770
                                              --------------- -------------- -------------- --------------- ------------ -----------
</TABLE>


                                       12
<PAGE>
<TABLE>
<S>                                          <C>            <C>            <C>                <C>           <C>        <C>

Income (loss) from continuing operations
  before income taxes                             19,312         (2,023)          1,511              114        2,089       21,003
Interest expense (income), net (b)                     -          4,097          (1,215)               -       (1,983)         899
Depreciation and amortization                        125          7,083             733               68            5        8,014
                                              --------------- -------------- -------------- --------------- ------------ -----------
EBITDA (c)                                    $   19,437     $    9,157     $     1,029      $       182     $    111    $  29,916
                                              --------------- -------------- -------------- --------------- ------------ -----------

Capital expenditures                          $    1,204     $    4,344     $       111      $         -     $      3    $   5,662
</TABLE>

          (a)  Segment  information does not include net loss from  discontinued
               operations of $57,000 in the nine months ended January 31, 2008.

          (b)  Interest expense (income),  net includes  inter-segment  interest
               income and expense that is eliminated in consolidation.

          (c)  The Company uses EBITDA (which the Company defines as income from
               continuing  operations before interest expense, net, income taxes
               and  depreciation  and  amortization)  in addition to income from
               continuing  operations  as a key  measure  of  profit or loss for
               segment performance and evaluation purposes.

Item 2. Management's  Discussion and Analysis of Financial Condition
        ------------------------------------------------------------
        and Results of Operations
        -------------------------

INTRODUCTION
- ------------

The Company,  through its  subsidiaries,  is primarily  engaged in four business
segments:  the Real Estate  business  operated by AMREP  Southwest  Inc. and its
subsidiaries (collectively,  "AMREP Southwest") and the Subscription Fulfillment
Services,  Newsstand  Distribution  Services  and Product  Fulfillment  Services
businesses  operated  by  Kable  Media  Services,   Inc.  and  its  subsidiaries
(collectively,  "Kable" or "Media  Services").  The Company's  foreign sales and
activities are not significant.

The following  provides  information that management  believes is relevant to an
assessment and understanding of the Company's consolidated results of operations
and financial  condition.  The discussion should be read in conjunction with the
April 30, 2008  consolidated  financial  statements and accompanying  notes. All
references  in this Item 2 to the third quarter or first nine months of 2009 and
2008 mean the fiscal  three and nine month  periods  ended  January 31, 2009 and
2008.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES
- ------------------------------------------

Management's  discussion  and  analysis of  financial  condition  and results of
operations is based on the  accounting  policies used and disclosed in the April
30, 2008  consolidated  financial  statements and  accompanying  notes that were
prepared in accordance  with  accounting  principles  generally  accepted in the
United States of America and included as part of the Company's  annual report on
Form  10-K for the year  ended  April 30,  2008  (the  "2008  Form  10-K").  The
preparation of those consolidated  financial  statements  required management to
make estimates and assumptions  that affected the reported amounts of assets and
liabilities and disclosure of contingent  assets and liabilities at the dates of
the consolidated  financial  statements and the reported amounts of revenues and
expenses  during the reporting  periods.  Actual amounts or results could differ
from those estimates.

The  significant  accounting  policies of the Company are described in Note 1 to
the  April  30,  2008  consolidated  financial  statements,   and  the  critical
accounting  policies and estimates are described in Management's  Discussion and
Analysis included in Item 7 of the 2008 Form 10-K. There have been no changes in
these critical accounting  policies.  Information  concerning the implementation
and the impact of new accounting  standards  issued by the Financial  Accounting
Standards  Board  ("FASB")  is  included  in the  notes to the  April  30,  2008
consolidated financial statements.

                                       13
<PAGE>

The  Company  adopted  Statement  of  Financial  Accounting  Standards  ("SFAS")
No. 157, "Fair Value Measurements",  effective May 1, 2008. The adoption of SFAS
No. 157 did not have an impact on the Company's  consolidated financial position
or results of operations. The Company also adopted SFAS No. 159, "The Fair Value
Option for Financial  Assets and Financial  Liabilities - Including an Amendment
of FASB Statement No. 115",  effective May 1, 2008. The adoption of SFAS No. 159
did not have an impact  on the  Company's  consolidated  financial  position  or
results of  operations.  The Company did not adopt any new  accounting  policies
during the quarter ended January 31, 2009.

RESULTS OF OPERATIONS
- ---------------------

For the third  quarter of 2009,  the Company had net loss of $100,000,  or $0.02
per share,  compared  to net income of  $3,446,000,  or $0.57 per share,  in the
third quarter of 2008.  For the first nine months of fiscal 2009, net income was
$2,866,000, or $0.48 per share, compared to net income of $13,176,000,  or $2.08
per  share,  for  the  same  period  of  2008.  Revenues  were  $35,720,000  and
$111,580,000  in the third  quarter  and first nine  months of 2009  compared to
$43,435,000 and $136,885,000 in the same periods last year.

Results  for the first nine  months of 2008  included  a loss from  discontinued
operations  of $57,000,  net of tax, or $0.01 per share,  that  reflected  costs
incurred in the first quarter of 2008 in connection  with the  settlement of all
litigation  related to the Company's El Dorado,  New Mexico former water utility
subsidiary  that were in addition to costs estimated and accrued for this matter
in the fourth quarter of fiscal 2007.

Revenues from land sales at AMREP Southwest were $521,000 and $6,594,000 for the
three and nine month periods  ended January 31, 2009 compared to $6,302,000  and
$27,613,000  for the same periods of the prior year.  The decrease of $5,781,000
for the third quarter of 2009 compared to the same quarter of 2008 reflected the
sale in last year's third quarter of two  commercial  lots  totaling  $5,731,000
with no  comparable  sales in 2009.  AMREP  Southwest  continues  to  experience
substantially lower land sales in its principal market of Rio Rancho, New Mexico
due  to  the  severe   decline  in  the  real  estate   market  in  the  greater
Albuquerque-metro  and Rio Rancho  areas that  began in earlier  periods.  Third
quarter 2009 land sales revenues were from the sale of 11 developed  residential
lots  and 3  undeveloped  residential  lots to  homebuilders,  while in the same
period of fiscal 2008 there were land sales of 26 undeveloped  residential  lots
to homebuilders  and the sale of  approximately  25 acres of undeveloped land to
commercial developers.  The trend of declining permits for new home construction
in the Rio Rancho area also continues,  with 32% fewer single-family residential
building  permits  issued during  calendar year 2008 than in calendar year 2007.
The  Company   believes  that  this  decline  has  been   consistent   with  the
well-publicized  problems of the  national  home  building  industry  and credit
markets,  including  fewer sales of both new and existing  homes,  an increasing
number of mortgage  delinquencies  and foreclosures and a tightening of mortgage
availability. Faced with these adverse conditions, builders have slowed the pace
of building  on  developed  lots  previously  purchased  from the Company in Rio
Rancho and delayed or cancelled the purchase of additional developed lots. These
factors have also contributed to a steep decline in the sale of undeveloped land
to both builders and investors.




                                       14
<PAGE>

In Rio Rancho,  the Company offers for sale both developed and undeveloped  lots
to  national,  regional  and local  home  builders,  commercial  and  industrial
property  developers and others.  For the third quarter and first nine months of
fiscal 2009 and 2008, the Company's land sales in Rio Rancho were as follows:

<TABLE>
<S>                       <C>           <C>            <C>             <C>            <C>            <C>
                                                              Fiscal Year
                          --------------------------------------------------------------------------------------
                                           2009                                          2008
                          ---------------------------------------      -----------------------------------------
                                                       Revenues                                       Revenues
                           Acres        Revenues       Per Acre         Acres         Revenues        Per Acre
                            Sold        (in 000s)      (in 000s)         Sold         (in 000s)       (in 000s)
                         ----------    -----------    -----------      --------      ------------    -----------

Three months ended
January 31:
 Developed
   Residential               1.5        $   361        $   241              -         $       -       $      -
   Commercial                  -              -              -           25.0             5,731            229
                         ----------    -----------    -----------      --------      ------------    -----------
 Total Developed             1.5            361            241           25.0             5,731            229
 Undeveloped                 2.5            160             64           24.3               571             24
                         ----------    -----------    -----------      --------      ------------    -----------
   Total                     4.0        $   521        $   130           49.3         $   6,302       $    128
                         ----------    -----------    -----------      --------      ------------    -----------

Nine months ended
January 31:
 Developed
   Residential               3.2        $   789        $   247           30.0         $   9,468       $    316
   Commercial                1.0            126            126           38.8             8,651            223
                         ----------    -----------    -----------      --------      ------------    -----------
 Total Developed             4.2            915            218           68.8            18,119            263
 Undeveloped               134.4          5,679             42          326.5             9,494             29
                         ----------    -----------    -----------      --------      ------------    -----------
   Total                   138.6        $ 6,594        $    48          395.3         $  27,613       $     70
                         ----------    -----------    -----------      --------      ------------    -----------
</TABLE>

The  average  selling  price of land sold by the Company in Rio Rancho in recent
years  has  fluctuated,  as the  Company  offers  for sale  both  developed  and
undeveloped  land from a number of different  projects,  and selling  prices may
vary from project to project and within  projects  depending  on  location,  the
stage of development and other factors. The revenue per acre of undeveloped land
in the third quarter of 2009 was higher compared to the same period in the prior
year due to the  undeveloped  land sold in the current year being from locations
nearer  developed areas and thus generally having higher average selling prices.
The average  gross profit  percentage  on land sales  decreased  from 63% in the
third quarter 2008 to 36% for the same period in 2009,  reflecting the fact that
the 2008 third quarter land sales included  approximately 25 acres of commercial
property  which  carried a higher profit margin than was produced by the sale of
developed  residential  lots in the third  quarter  of 2009.  For the first nine
months the average gross profit percentage  increased from 65% in 2008 to 87% in
2009.  This increase for the first nine months of 2009 was  attributable  to the
mix of land sold, and  principally  was the result of a second quarter 2009 sale
of 50  acres  of  undeveloped  land  to  one  purchaser  for  $3,849,000,  which
contributed a gross profit of $3,825,000 (99%). Revenues, gross profits, average
sales  prices and  related  gross  profit  percentages  from land sales can vary
significantly  from period to period as a result of many factors,  including the
nature  and  timing  of  specific  transactions,   and  prior  results  are  not
necessarily a good indication of what may occur in future periods.

Revenues from the Company's Media Services operations decreased from $36,458,000
for the third  quarter of 2008 to  $35,051,000  for the same  period in 2009,  a
decline of 4%. For the first nine  months of 2009,  Kable  Media's  revenues  of
$104,328,000  were generally  unchanged from  $104,317,000 in the same period of
2008. The revenue decrease in the third quarter of 2009 reflected an 11% revenue
decrease from reduced and lost business from Subscription  Fulfillment Services.
The  well-publicized  problems  confronting  the magazine  publishing  industry,
including declining advertising revenues, lower


                                       15
<PAGE>

subscription  and  newsstand  sales and  increasing  costs,  contributed  to the
decline in the  revenues of Kable since  publishing  is the  principal  industry
which Kable serves.  Revenues from Subscription  Fulfillment Services operations
decreased from  $32,645,000 and $92,111,000 for the three and nine month periods
of 2008 to  $28,998,000  and  $90,175,000  for the  comparable  periods in 2009,
primarily reflecting the net effect of the previously mentioned reduced and lost
business  from certain  customers  that was offset in part by revenue gains from
new  and  existing  clients.   Revenues  from  Newsstand  Distribution  Services
operations  were  generally  unchanged for the third quarter of 2009 compared to
the third quarter of 2008,  totaling $2,923,000 this year compared to $2,944,000
for the same period in 2008. Newsstand  Distribution Services revenues decreased
from  $9,811,000  for the first nine months of 2008 to  $9,374,000  for the same
period in 2009,  primarily  reflecting a softening of magazine newsstand demand.
Revenues from Product Fulfillment Services and other increased from $892,000 and
$2,449,000  for the three and nine month periods of the prior year to $3,130,000
and $4,779,000 for the  comparable  periods in the current year,  primarily as a
result of the inclusion of the results of  operations  of the Company's  product
repackaging  business  and  temporary  staffing  services  business  from  early
November 2008 when the Company  purchased  certain  assets of companies that had
been in those businesses.  Kable's operating  expenses increased by $382,000 and
$1,087,000  for the third  quarter and first nine months of 2009 compared to the
same periods in 2008,  primarily  attributable to higher consulting and computer
systems  integration costs of the Subscription  Fulfillment  Services  business,
which were partly  offset by lower  interest  expense  principally  due to lower
interest rates in both periods of 2009.

As  a  result  of the  significant   disruption  in  the  magazine  distribution
system that  occurred in February 2009 (see Note 14),  there has been an adverse
effect on commission  revenues in the Newsstand  Distribution  Services business
that is  continuing.  Because  uncertainties  still  remain in the  distribution
system,  the Company is not yet able to predict the effect of this disruption on
its financial condition and results of operations.

In  January  2008,  the  Company  announced  a  project  to unify  its  magazine
subscription,  membership  and  direct  mail  fulfillment  services  from  three
locations  into one  location  at Palm  Coast,  Florida,  which is  expected  to
streamline  operations,  improve service to clients and create cost efficiencies
through reduced  overhead costs and the  elimination of operating  redundancies.
The Company is still evaluating various  alternatives for this expansion,  which
could require  capital  expenditures in the range of $15,000,000 to $20,000,000.
The project is scheduled to be implemented over a two-to-three year period,  and
over that period may involve  approximately  $6,000,000  of  non-recurring  cash
costs for severance,  training and transition,  facility  closings and equipment
relocation.  The State of  Florida  and the City of Palm  Coast  have  agreed to
provide incentives for the project,  including cash and employee training grants
and tax relief, which could amount to as much as $8,000,000,  largely contingent
on existing job retention,  new job creation and capital investment.  Previously
during  fiscal  2008,  the  Company  announced  (i)  one  significant  workforce
reduction in its Subscription Fulfillment Services business that occurred in the
third quarter of fiscal 2008, (ii) a plan to redistribute  the work performed at
the Marion, Ohio facility of its Fulfillment Services business and the scheduled
closing of that facility that was  substantially  completed in August 2008,  and
(iii) the consolidation of fulfillment operations customer call centers.  During
the quarter ended January 31, 2009,  the Company  recognized  $175,000 of income
for certain incentives related to the unification project, which are netted with
costs of  $169,000.  As a  result,  the  Company  reported  a net gain of $6,000
related to the unification project in the third quarter of 2009 and incurred net
costs of  $567,000  for the first nine  months of 2009  compared to net costs of
$136,000 and $556,000 for the same periods of 2008,  principally  for  severance
and  consulting  costs.  The items of income  related  to  incentives  and costs
related to the  unification  project  are  included  in  Restructuring  and fire
recovery  costs in the  Company's  consolidated  statements  of  operations  and
retained earnings.

On December 5, 2007, a warehouse of  approximately  38,000 square feet leased by
the Company in Oregon, Illinois was totally destroyed by fire. The warehouse was


                                       16
<PAGE>

used  principally  to store  back  issues  of  magazines  published  by  certain
customers for whom the Company filled back-issue orders as part of its services.
The Company was  required to provide  insurance  for certain of those  customers
whose property was destroyed in the warehouse fire.  Through  February 28, 2009,
the Company's insurance carrier had paid approximately $211,000 to customers for
lost materials. The Company believes that the net effect of the outcome of other
pending or unasserted claims related to materials of certain publishers for whom
it was required to provide  insurance,  together with proceeds from its property
claims,  will not have a material effect on its financial  position,  results of
operations or cash flows.

The Company has filed a preliminary  claim with its  insurance  provider for its
property  loss as a  result  of the  fire and has  been  advanced  $500,000  for
replacement  of such  property.  During the quarter ended January 31, 2009,  the
Company  replaced a portion of the fixed assets lost in the  warehouse  fire and
recorded a $134,000 gain resulting from the  recognition of insurance  proceeds,
which is netted  against  costs  related to the fire.  As a result,  the Company
reported  a net  gain of  $77,000  for the  third  quarter  and net  charges  to
operations of $62,000 for the first nine months of 2009 related to fire recovery
costs,  principally  for legal and other advisory costs that were not covered by
insurance.  The  item of  income  related  to  insurance  proceeds  and the fire
recovery  costs are included in  Restructuring  and fire  recovery  costs in the
Company's  consolidated  statements  of  operations  and retained  earnings.  In
addition,  the Company recorded $173,000 of other income in the first quarter of
2009  for a  business  interruption  claim  resulting  from  the  fire,  and has
approximately  $140,000 of business  interruption  claims  pending  with but not
approved by its insurance provider.

Interest and other  revenues  decreased  $527,000 and  $4,297,000  for the third
quarter and nine month  periods  ended  January  31,  2009  compared to the same
periods in the prior year,  primarily  due to a pre-tax  gain from the sale of a
commercial  property  ($1,873,000)  and  the  forfeiture  of a  deposit  for the
purchase  of  land by a  homebuilder  who did not  exercise  a  purchase  option
($618,000) in the second quarter of 2008, with no similar transactions occurring
in the first nine months of 2009. In addition,  interest and other revenues were
also lower in the third  quarter and first nine  months of 2009  compared to the
same periods in 2008 due to lower cash balances.

Real estate commissions and selling expenses decreased $221,000 and $393,000 for
the third  quarter and nine month periods ended January 31, 2009 compared to the
same periods in the prior year, principally due to the reduced land sales. Other
operating  expenses increased $770,000 and $379,000 for the three and nine month
periods ended January 31, 2009 compared to the same periods last year, primarily
due to a net  favorable  $558,000  adjustment  to real estate tax expense in the
third  quarter  of 2008  resulting  from  the  finalization  of a  property  tax
valuation appeal by AMREP Southwest and a $184,000 adjustment to real estate tax
expense in 2009 as a result of receiving the final calendar year 2008 tax bills.

General and  administrative  expenses  of Media  Services  operations  increased
$317,000  and  $257,000  in the  third  quarter  and first  nine  months of 2009
compared to the same periods in 2008, primarily due to the aforementioned higher
consulting  fees and  computer  system  integration  costs  associated  with the
unification  project of the Subscription  Fulfillment  Services  business.  Real
estate  operations and corporate  general and  administrative  expense decreased
$77,000  and  $190,000  for the  third  quarter  and first  nine  months of 2009
compared to the same periods last year,  primarily  due to reduced  professional
fees.

LIQUIDITY AND CAPITAL RESOURCES
- -------------------------------

During the past several  years,  the Company has financed  its  operations  from
internally generated funds from real estate sales and Media Services operations,
and from  borrowings  under its various  lines-of-credit  and  development  loan
agreements.


                                       17
<PAGE>

Cash Flows From Operating Activities
- ------------------------------------

Real  estate  receivables  decreased  from  $13,124,000  at  April  30,  2008 to
$4,064,000  at  January  31,  2009   reflecting   the  net  effect  of  (i)  the
reclassification  of  approximately  $6,530,000  to real  estate  inventory  and
$1,125,000 to investment  assets from mortgage notes  receivable  resulting from
the Company's  acceptance of deeds in lieu of foreclosure  related to delinquent
mortgage note  receivables and (ii) payments  received on mortgage notes held by
AMREP Southwest offset in part by mortgages notes received by AMREP Southwest in
connection  with real estate  sales that closed  during the first nine months of
2009.

Media Services  operations  accounts  receivable  increased from  $45,701,000 at
April 30, 2008 to $50,059,000  at January 31, 2009,  primarily due to the effect
of higher  quarter-end  billings at January 31, 2009  compared to April 30, 2008
and the timing of payments by  customers.  Media  Services  operations  accounts
receivable  include  approximately  $7,500,000  from a  distribution  wholesaler
customer that suspended normal business activities in February,  which amount is
subject to adjustment by magazine return  activity  subsequent to the end of the
quarter that may differ from the  Company's  estimates.  No payments of accounts
receivable  have been received by the Company from this  customer  after January
31, 2009.  Because the  potential  loss on amounts due from this  wholesaler  is
unable  to  be  estimated,  the  Company  has  not  provided  an  allowance  for
uncollectibility,  but it  continues  to monitor the  collectibility  of the net
receivable  and  will  provide  an  appropriate  allowance  if and  when  deemed
necessary (see Notes 3 and 14).

Real  estate   inventory  was  $81,817,000  at  January  31,  2009  compared  to
$70,252,000  at April 30,  2008.  Inventory  in the  Company's  core real estate
market of Rio Rancho increased from $63,215,000 at April 30, 2008 to $74,442,000
at January 31, 2009, primarily reflecting the reclassification of mortgage notes
receivable  to  inventory  discussed  above and the net  effect  of  development
spending  and land  sales.  The balance of real estate  inventory  consisted  of
properties in Colorado.

Property,  plant and equipment  increased from  $28,914,000 at April 30, 2008 to
$32,500,000  at January 31, 2009,  primarily  due to a third  quarter  warehouse
acquisition by the Company, offset in part by normal depreciation charges.

Accounts  payable and accrued  expenses  decreased from $98,532,000 at April 30,
2008 to $77,850,000 at January 31, 2009,  primarily as a result of the timing of
payments due to  publishers  and  vendors.  In  addition,  under a  distribution
arrangement with one publisher customer of the Newsstand  Distribution  Services
business,  that publisher  bears the ultimate credit risk of  non-collection  of
related  amounts due from the  customers  to which the Company  distributes  the
publisher's  magazines.  Accounts  receivable  subject to this  arrangement were
netted ($29,662,000 was netted at January 31, 2009 and $22,703,000 was netted at
April 30, 2008)  against the related  accounts  payable due the publisher on the
accompanying consolidated balance sheets.

Cash Flows From Investing Activities
- ------------------------------------

Restricted cash of $3,856,000 reflects amounts held in escrow that were received
in connection  with the sale of investment  assets that are  identified as "1031
Exchange  assets" and which are  restricted  pending the purchase of  identified
replacement assets.

On November 7, 2008, the Company,  through a  newly-formed  subsidiary of Kable,
acquired certain assets of a privately-held  product repackaging and fulfillment
industry  company,  including a warehouse.  The aggregate  purchase price of the
assets  purchased was  approximately  $8,500,000,  and was financed from working
capital, bank borrowings and the assumption of a $4,747,000 mortgage note on the
warehouse (see Note 13).

                                       18
<PAGE>

Capital  expenditures totaled $1,521,000 and $5,662,000 in the first nine months
of 2009 and 2008.  Capital  expenditures  in 2009 were  primarily  for  computer
hardware  and  software  development  expenditures  related to the  Subscription
Fulfillment  Services  business.  Capital  expenditures  in 2008  were  also for
computer  hardware  and  software   development   expenditures  related  to  the
Subscription  Fulfillment Services business,  as well as for certain real estate
investment  assets.  Based in part on  discussions  with existing  lenders,  the
Company  believes that it has adequate cash and financing  capability to provide
for its anticipated future capital expenditures,  subject in all respects to the
following discussion about cash flows from financing activities.

Cash Flows From Financing Activities
- ------------------------------------

AMREP  Southwest has a $25,000,000  revolving  credit  facility with a bank that
matures in September  2009.  The revolving  credit  facility had an  outstanding
balance of $25,000,000 at January 31, 2009 and $24,000,000 at February 28, 2009.
At January 31, 2009,  AMREP  Southwest  was in  compliance  with the  facility's
covenants.  As a result of the extreme volatility in the financial markets,  the
cost of obtaining  money has increased and many lenders have increased  interest
rates, imposed tighter lending standards,  refused to refinance existing debt at
maturity on terms  similar to current  terms and, in some cases,  have ceased to
provide funding to borrowers.  The bank has recently initiated  discussions with
AMREP Southwest  regarding a renewal of the arrangement;  however,  the bank has
also indicated that, due to the credit markets and the real estate  economy,  it
would expect  different terms and conditions,  including a higher interest rate,
in order to extend the line.

Kable  maintains  a bank  credit  facility  aggregating  $52,536,000,  including
revolving  credits of  $45,000,000  maturing in May 2010 and term  borrowings of
$7,536,000  maturing in part in December 2009 and the balance in May 2010, which
is  described  in greater  detail in the 2008 Form 10-K.  The total  outstanding
balance of the bank credit  facility was  $12,244,000  at January 31, 2009.  The
facility  requires  Kable to comply with a number of covenants,  including  some
based upon its financial performance measured at the end of its fiscal quarters.
At January 31, 2009, Kable was in compliance with these covenants.  However,  as
reported  in Note 14 to the  financial  statements,  Kable  has a net  estimated
account receivable of approximately $7,500,000 at January 31, 2009 from Anderson
News,  LLC,  a major  wholesaler  customer  of  Kable's  Newsstand  Distribution
Services  business that has ceased  operations and is  liquidating,  and at this
time Kable is unable to estimate the collectibility of the account.  The Company
believes  it is  possible  that a  significant  portion of the  account  will be
determined  to be  uncollectible  and that such  determination  could be made as
early as during the  Company's  current  fiscal  quarter  ending April 30, 2009.
Depending on the amount of the reserve that Kable  establishes for this or other
uncollectible accounts receivable, Kable may become in default of one or more of
the covenants under its credit facility,  unless the non-compliance is waived by
the  lender.  If Kable is unable to obtain a waiver  for any event of default on
satisfactory  terms,  Kable would not be able to borrow funds under the facility
until the  non-compliance is cured and the lender would be permitted to exercise
a number of remedies,  including the rights to seek  immediate  repayment of all
outstanding  loans.  Kable is in  discussions  with the lending  bank,  which is
monitoring  the situation but has not  indicated  what action,  if any, it would
take should such a default occur.

With  respect  to the  Subscription  Fulfillment  Services  unification  project
described above in Results of Operations,  the Company expects that this project
will include a two-to-three year capital expansion program. The Company is still
evaluating various alternatives for this expansion,  which could require capital
expenditures in the range of $15,000,000 to $20,000,000,  of which $3,800,000 is
contemplated  to be provided by AMREP  Southwest  in the form of an "IRS Section
1031  reinvestment"  purchase of an office  building that will be leased back to
Palm Coast Data ("Palm Coast"),  a Kable subsidiary.  The Company also estimates
that the implementation of this program will result in approximately  $6,000,000


                                       19
<PAGE>

of  non-recurring  cash costs for severance,  training and transition,  facility
closings and  equipment  relocation.  To assist in the  program,  Palm Coast has
procured  approximately  $8,000,000 of actual and potential  incentives from the
State of Florida and the City of Palm Coast for the project,  including cash and
employee training grants and tax relief that are largely  contingent on existing
job  retention,  new job  creation  and  capital  investment.  The Company is in
various stages of discussions with several possible lenders to provide financing
for part of this  expansion,  with the  balance  anticipated  to be funded  from
operations.

In all of the above cases, there can be no assurance the required financing will
be available on satisfactory terms.

Future Payments Under Contractual Obligations
- ---------------------------------------------

The  Company is  obligated  to make future  payments  under  various  contracts,
including its debt  agreements and lease  agreements,  and is subject to certain
other  commitments and  contingencies.  The table below  summarizes  significant
contractual  obligations  as of January  31,  2009 for the items  indicated  (in
thousands):

<TABLE>
<S>                          <C>            <C>               <C>                <C>             <C>
                                               Less than          1 - 3             3 - 5           More than
Contractual Obligations         Total           1 year            years             years            5 years
- -----------------------         -----          ---------          -----             -----           ---------

Notes payable                  $ 42,395         $ 27,029         $ 10,818         $   321           $   4,227
Operating leases and other       24,992            5,233           10,363           6,637               2,759
                             -----------    --------------    -------------     -------------    --------------
Total                          $ 67,387         $ 32,262         $ 21,181         $ 6,958           $   6,986
                             ===========    ==============    =============     =============    ==============
</TABLE>

The  increase  in  notes  payable  from  April  30,  2008  was due to  increased
borrowings by AMREP  Southwest and Media  Services,  and to the  assumption of a
mortgage note payable in connection with the purchase of a warehouse in November
2008  (see  Note  13).  Operating  leases  and  other  includes  liabilities  of
$2,230,000  related to unrecognized  tax benefits and related  accrued  interest
recorded  in  accordance  with  FIN  48.  Refer  to  Notes  9,  14 and 16 to the
consolidated  financial statements included in the 2008 Form 10-K for additional
information on long-term debt and commitments and contingencies.

Pension Plan
- ------------

With the recent  substantial  declines  in the global  equity and debt  markets,
there has been a  substantial  decline in the fair market value of the assets in
the  Retirement  Plan  for  Employees  of  AMREP  Corporation   ("Plan"),   from
$27,225,000 at April 30, 2008 to approximately $15,623,000 at February 28, 2009.
Under current law,  funding  requirements to the Plan are determined  based upon
the provisions of the Pension  Protection Act of 2006, which generally  requires
"full funding" (as defined) of defined  benefit  pension plans to be made over a
seven  year  period.  As a result,  it is  expected  that  there will be funding
requirements from the Company to the Plan beginning in calendar 2010. The amount
that may be required to be funded by the Company is not presently  determinable,
as it will be based  upon  the fair  market  value of  assets  of the Plan as of
January 1, 2009  ($18,539,000) as compared to the actuarially  computed value of
the  Plan's  vested  liabilities  at that  date,  which  amount has not yet been
determined by the Plan actuary.  In addition,  the change from April 30, 2008 to
April 30, 2009 in the accrued pension liability for the Plan based upon the fair
market value of assets  compared to the pension  benefit  obligation as of those
dates will be reflected as a component  of  comprehensive  income or loss in the
Company's 2009 financial statements.

Risk Factors
- ------------

In addition to the other  information  set forth in this report included in Part
II,  "Item 1A. Risk  Factors",  the factors  discussed in Part I, "Item 1A. Risk
Factors" in the 2008 Form 10-K,  which  could  materially  affect the  Company's


                                       20
<PAGE>

business, financial condition or future results, should be carefully considered.
The risks  described  herein  and in the 2008  Form 10-K are not the only  risks
facing the Company.  Additional risks and  uncertainties  not currently known to
the Company or that  currently are deemed to be immaterial  also may  materially
adversely  affect the  Company's  business,  financial  condition  or  operating
results.

Statement of Forward-Looking Information
- ----------------------------------------

The Private Securities Litigation Reform Act of 1995 (the "Act") provides a safe
harbor for forward-looking  statements made by or on behalf of the Company.  The
Company  and its  representatives  may from  time to time make  written  or oral
statements that are  "forward-looking",  including  statements contained in this
report and other filings with the Securities and Exchange Commission, reports to
the  Company's  shareholders  and news  releases.  All  statements  that express
expectations, estimates, forecasts or projections are forward-looking statements
within the meaning of the Act. In addition,  other  written or oral  statements,
which constitute forward-looking  statements, may be made by or on behalf of the
Company. Words such as "expects", "anticipates", "intends", "plans", "believes",
"seeks", "estimates",  "projects",  "forecasts",  "may", "should", variations of
such words and similar expressions are intended to identify such forward-looking
statements.  These  statements  are not  guarantees  of future  performance  and
involve certain risks,  uncertainties  and  contingencies  that are difficult to
predict.  These  risks and  uncertainties  include,  but are not limited to, the
risks described above under the heading "Risk Factors". Many of the factors that
will determine the Company's future results are beyond the ability of management
to control  or  predict.  Therefore,  actual  outcomes  and  results  may differ
materially  from  what  is  expressed  or  forecasted  in or  suggested  by such
forward-looking  statements.  The forward-looking  statements  contained in this
report  include,  but are not limited to,  statements  regarding the unification
project  of  the  Subscription  Fulfillment  Services  business  (including  the
Company's estimated related capital  expenditures and incentives  anticipated to
be  received  from  the  State  of  Florida  and the  City of Palm  Coast),  the
receivables owing from Anderson News, LLC, future financing requirements and the
status of negotiations with the Company's  existing lenders,  and future pension
plan funding  obligations.  The Company  undertakes  no  obligation to revise or
update  any  forward-looking  statements,  or to make any other  forward-looking
statements, whether as a result of new information, future events or otherwise.

Item 3. Quantitative and Qualitative Disclosures About Market Risk
- ------- ----------------------------------------------------------
The  Company  has  several  credit  facilities  that  require the Company to pay
interest at a rate that may change periodically. These variable rate obligations
expose the  Company to the risk of  increased  interest  expense in the event of
increases in  short-term  interest  rates.  At January 31, 2009,  borrowings  of
$33,999,000 were subject to variable  interest rates.  Refer to Item 7(A) of the
2008 Form 10-K for additional information regarding quantitative and qualitative
disclosures about market risk.

Item 4. Controls and Procedures
- ------- -----------------------

Evaluation of Disclosure  Controls and Procedures

The  Company's  management,  with  the  participation  of  the  Company's  chief
financial  officer  and  the  other  executive  officers  whose   certifications
accompany  this  quarterly  report,  has  evaluated  the  effectiveness  of  the
Company's disclosure controls and procedures (as defined in Rule 13a-15(e) under
the Securities Exchange Act of 1934) as of the end of the period covered by this
report.  As a result of such  evaluation,  the chief financial  officer and such
other  executive  officers  have  concluded  that such  disclosure  controls and
procedures are effective to provide  reasonable  assurance that the  information
required to be disclosed in the reports the Company  files or submits  under the
Securities  Exchange  Act of 1934 is (i)  recorded,  processed,  summarized  and
reported  within the time  periods  specified  in the  Securities  and  Exchange
Commission's  rules and forms,  and (ii)  accumulated  and  communicated  to the


                                       21
<PAGE>

Company's management,  including its principal executive and principal financial
officers,  or persons  performing similar  functions,  as appropriate,  to allow
timely  decisions  regarding  disclosure.  The Company  believes  that a control
system,  no matter how well  designed  and  operated,  cannot  provide  absolute
assurance  that  the  objectives  of the  control  system  will be  met,  and no
evaluation of controls can provide  absolute  assurance  that all control issues
and instances of fraud, if any, within a company have been detected.

Changes in Internal Control over Financial Reporting

No change in the Company's system of internal  control over financial  reporting
occurred during the most recent fiscal quarter that has materially affected,  or
is  reasonably  likely to materially  affect,  internal  control over  financial
reporting.

                           PART II. OTHER INFORMATION

Item 1. Legal Proceedings
- ------- -----------------

On February 9, 2009, a civil action was commenced in the United States  District
Court  for  the  Southern   District  of  New  York  entitled  Source  Interlink
Distribution,  LLC, et al. v. American  Media,  Inc.,  et al.  Source  Interlink
Distribution,  LLC ("Source") is a wholesaler of magazines.  It has alleged that
magazine  publishers and distributors,  including Kable  Distribution  Services,
Inc. ("Kable"),  which is a wholly-owned subsidiary of the Company, conspired to
boycott  Source  to  drive  it out  of  business,  and  that  other  wholesalers
participated  in this  effort.  It has asserted  claims  under  Section 1 of the
Sherman Act  (antitrust) for defamation and for tortious  interference  with its
contracts with retailers. Damages have not been quantified. The Company believes
that Kable has good defenses to the claims and intends  vigorously to defend the
lawsuit. However, the lawsuit was commenced very recently and the Company is not
in a position to predict its outcome.

On March 10, 2009, Anderson News, LLC commenced a civil action against Kable and
others. The complaint contains allegations  substantially  similar to those made
by Source.

Item 1A. Risk Factors
- -------- ------------

As described  below, a recent  notification  that a significant  customer of the
Company has ceased  operations  and the impact of the current  global  financial
crisis and condition of credit and capital  markets may involve further risks to
the Company's business.

Kable faces a risk of  non-compliance  with a financial  covenant related to its
- --------------------------------------------------------------------------------
bank  credit  facility,  and may be unable  to obtain a waiver of such  covenant
- --------------------------------------------------------------------------------
default.
- --------

As reported in Note 14 to the financial  statements  included in this  Quarterly
Report, Kable has a net estimated account receivable of approximately $7,500,000
from Anderson News, LLC, which has ceased  operations and is in liquidation.  At
this time, Kable is unable to estimate the collectibility of the account.  Kable
was in compliance  with all covenants in its bank credit  facility as of January
31, 2009. However, the Company believes it is possible that a significant amount
of the Anderson News, LLC account  receivable may ultimately be determined to be
uncollectible,  that such  determination  could be made as early as  during  the
Company's  current  fiscal quarter ending April 30, 2009, and that the effect of
this  determination  on Kable's  financial  results  could be to place  Kable in
default  of its credit  facility.  If Kable is unable to obtain a waiver for any
event of default on satisfactory  terms, Kable would not be able to borrow funds
under the credit facility until the non-compliance is cured and the lender would
be  permitted  to  exercise a number of  remedies,  including  the right to seek
immediate  repayment of all outstanding loans. Kable may not be able to obtain a
waiver of any default that occurs on acceptable  terms,  on a timely basis or at
all. In addition,  any waiver may require Kable to pay a fee to the lender under
the credit facility or to amend the terms of the credit facility, which could


                                       22
<PAGE>

increase  its cost of credit  and  related  expenses  and  adversely  impact the
Company's  results  of  operations.  If Kable  fails to  obtain a waiver  of any
default and the lender under the credit  facility  requires Kable to immediately
repay all  amounts  outstanding  under such  facility,  it would have a material
adverse effect on the Company's  liquidity,  business,  financial  condition and
results of operations.

The  effects of the  current  global  economic  crisis may impact the  Company's
- --------------------------------------------------------------------------------
business, operating results or financial condition.
- ---------------------------------------------------

The current global economic crisis has caused a general tightening of the credit
markets,  lower  levels of  liquidity,  increases  in the rates of  default  and
bankruptcy,  and extreme volatility in credit,  equity and fixed income markets.
The macroeconomic  developments could negatively affect the Company's  business,
operating  results or  financial  condition  in a number of ways.  For  example,
current or potential real estate  developers  may be unable to obtain  financing
which could cause them to delay,  decrease or cancel  purchases of land from the
Company,  and  revenues  from  advertising  sources  may  deteriorate  such that
magazine  publishers cease  publishing  certain titles and thus no longer have a
requirement for the Company's services.

The current deterioration of the credit and capital markets may adversely impact
- --------------------------------------------------------------------------------
the Company's ability to obtain financing on acceptable terms,  which may hinder
- --------------------------------------------------------------------------------
or prevent the Company from meeting its future operational and capital needs.
- -----------------------------------------------------------------------------

Global  financial  markets  have  been  experiencing   extreme   volatility  and
disruption,  and the debt and  equity  capital  markets  have  been  exceedingly
distressed.  These  issues  have made,  and will  likely  continue  to make,  it
difficult  to obtain  financing.  Also,  as a result of the  concerns  about the
stability of  financial  markets,  the cost of  obtaining  money from the credit
markets has increased,  as many lenders have increased  interest rates,  enacted
tighter lending standards, refused to refinance existing debt at maturity at all
or except on terms less  favorable  than those of the existing debt, and reduced
or, in some cases,  ceased to provide  funding to borrowers.  Moreover,  even if
lenders are willing and able to provide  adequate  funding,  interest  rates may
rise in the future and therefore  increase the cost of  borrowing.  As a result,
the Company may be unable to obtain  adequate  financing for its operating needs
or for its anticipated future capital expenditures.

Item 6. Exhibits
- ------- --------

Exhibit No.                             Description
- -----------                             -----------
  10.1    Amended and Restated  Distribution  Agreement dated as of July 1, 2008
          between Kappa Publishing Group, Inc. and Kable Distribution  Services,
          Inc.*
  31.1    Certification required by Rule 13a-14(a) under the Securities Exchange
          Act of 1934.
  31.2    Certification required by Rule 13a-14(a) under the Securities Exchange
          Act of 1934.
  31.3    Certification required by Rule 13a-14(a) under the Securities Exchange
          Act of 1934.
  32      Certification required pursuant to 18 U.S.C. Section 1350.



*Portions  of  this  exhibit  have  been  omitted  pursuant  to  a  request  for
confidential  treatment  under Rule 24b-2 under the  Securities  Exchange Act of
1934.



                                       23
<PAGE>


                                    SIGNATURE
                                    ---------

     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.

Date:  March 12, 2008         AMREP CORPORATION
                                 (Registrant)

                              By: /s/  Peter M.Pizza
                                  ----------------------------------------------
                                    Peter M. Pizza
                                    Vice President and Chief Financial Officer
                                    (Principal Financial and Accounting Officer)






                                       24
<PAGE>




                                 EXHIBIT INDEX
                                 -------------

Exhibit No.                             Description
- -----------                             -----------
  10.1    Amended and Restated  Distribution  Agreement dated as of July 1, 2008
          between Kappa Publishing Group, Inc. and Kable Distribution  Services,
          Inc.* - Filed Herewith
  31.1    Certification required by Rule 13a-14(a) under the Securities Exchange
          Act of 1934 - Filed herewith.
  31.2    Certification required by Rule 13a-14(a) under the Securities Exchange
          Act of 1934 - Filed herewith.
  31.3    Certification required by Rule 13a-14(a) under the Securities Exchange
          Act of 1934 - Filed herewith.
  32      Certification required pursuant to 18 U.S.C. Section 1350 - Filed
          herewith.











*Portions  of  this  exhibit  have  been  omitted  pursuant  to  a  request  for
confidential  treatment  under Rule 24b-2 under the  Securities  Exchange Act of
1934.





                                       25

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>2
<FILENAME>exh10_0309.txt
<TEXT>

                                                                    EXHIBIT 10.1

             CONFIDENTIAL TREATMENT REQUESTED PURSUANT TO RULE 24b-2

     Certain  portions,  indicated  by [***] of this  exhibit  have been omitted
pursuant  to a request  for  confidential  treatment  under Rule 24b-2 under the
Securities Exchange Act of 1934. The omitted portions have been filed separately
with the Securities and Exchange Commission.

                   AMENDED AND RESTATED DISTRIBUTION AGREEMENT

     THIS AGREEMENT is made and entered into at Fort Washington, Pennsylvania as
of the 1st day of July,  2008 by and between  KAPPA  PUBLISHING  GROUP,  INC., a
Delaware corporation, whose place of business is at 6198 Butler Pike, Blue Bell,
Pennsylvania  19422 (hereafter  referred to as PUBLISHER) and KABLE DISTRIBUTION
SERVICES, INC., a Delaware corporation,  whose place of business is at Suite 4C,
14 Wall Street, New York, NY 10005 (hereafter referred to as DISTRIBUTOR).

                               W I T N E S S E T H
                               - - - - - - - - - -

     WHEREAS,  PUBLISHER and  DISTRIBUTOR are parties to an Amended and Restated
Distribution  Agreement  dated as of April 30, 2006,  as amended (as so amended,
the "Original  Distribution  Agreement")  which provides for the distribution by
DISTRIBUTOR of PUBLISHER's titles; and

     WHEREAS,  PUBLISHER and DISTRIBUTOR wish to amend certain provisions of the
Original Distribution Agreement; and

     WHEREAS,  PUBLISHER  and  DISTRIBUTOR  have agreed to amend and restate the
Original Distribution  Agreement in its entirety to reflect the changes required
by the parties; and

     WHEREAS,  PUBLISHER  and  DISTRIBUTOR  agree  that the  provisions  of this
Agreement  shall apply solely to  Publications  published  by PUBLISHER  and its
Affiliates.

                                       1
<PAGE>

     NOW THEREFORE,  for and in  consideration  of the mutual  covenants  herein
contained,  and other good and valuable consideration,  the parties hereby agree
as follows:

1. DEFINITIONS
   -----------

     (a)  "Affiliate"  of any Person shall mean any other Person  controlling or
controlled  by or under  common  control  with such  specified  Person.  For the
purposes of this definition,  "control," when used with respect to any specified
Person,  shall mean the power to direct the management,  policies or investments
of such Person, directly or indirectly,  whether through the ownership of voting
securities,   by  contract  or  otherwise,   and  the  terms  "controlling"  and
"controlled" shall have meanings correlative to the foregoing.

     (b)  "Average  Net  Sale  Percentage"  with  respect  to  each  issue  of a
Publication  shall mean the  quotient of the Net  Billings  with  respect to the
Measurement  Issues (determined by reference to the Settlement Payment Publisher
Statements,  as defined in Paragraph 15, or comparable  statements,  as the case
may be, as referred to in the definition of Measurement  Issues)  divided by the
Publisher's  Gross Billings with respect to such Measurement  Issues  (similarly
determined).  When the context  requires,  Average Net Sale Percentage  shall be
calculated  separately for one or more Distributor's  Sales Outlets,  or for all
Distributor's Sales Outlets combined.

     (c) "Change of Control" with respect to any Person shall mean

          (i)  That any "person" or "group" within the meaning of Sections 13(d)
               and  14(d)(2) of the  Exchange  Act (x)  becomes the  "beneficial
               owner" as defined in Rule 13d-3  promulgated  under the  Exchange
               Act of more than 50%, of the then outstanding  voting  securities
               of such Person,  or (y) acquires by proxy,  contract or otherwise
               the right to vote for the election of directors  (or similar such
               managing  individuals),  for any merger or  consolidation of such
               Person,  or for any other matter or question more than 50% of the
               then outstanding voting securities of such Person; or

                                       2
<PAGE>

          (ii) That during any period of  twenty-four  (24)  consecutive  months
               (not  including any period prior to the date of this  Agreement),
               Present  Directors  and/or New Directors  cease for any reason to
               constitute  a  majority  of the Board of  Directors  (or  similar
               governing  body) of such Person.  For  purposes of the  preceding
               sentence,  "Present  Directors" shall mean individuals who at the
               beginning  of such  consecutive  twenty-four  month  period  were
               members of the Board of Directors (or similar  governing body) of
               such Person and "New  Directors"  shall mean any  director  whose
               election by the Board of Directors (or similar governing body) of
               such Person or whose  nomination  for  election by such  Person's
               stockholders  was approved by a vote of a least two-thirds of the
               directors then still in office who were Present  Directors or New
               Directors.

     (d)  "Completion  of Shipping"  with respect to each issue of a Publication
shall mean the date the  PUBLISHER's  printer  completed  shipping all copies of
such issue to  Distributor's  Sales  Outlets in  accordance  with  DISTRIBUTOR's
shipping instructions as stated on the Printer's Completion Notice.

     (e) "Cover  Price" with respect to each issue of a  Publication  shall mean
the suggested  retail selling price of such issue specified on the cover of each
copy thereof.

                                       3
<PAGE>

     (f) "Distributor's Estimated Final Net Billings" with respect to each issue
of a  Publication  shall mean the product of the Average Net Sale  Percentage of
such  Publication  (using the  Completion of Shipping as the  calculation  date)
multiplied by the Publisher's  Billing Price of such issue and multiplied by the
number  of  copies  of such  issue  shipped  in  accordance  with the  Printer's
Completion  Notice;   provided,   however,   that  Returns  of  issues  of  such
Publication,  the On-Sale  Dates of which are prior to those of the  Measurement
Issues,  which  have  not  previously  been  accounted  for may be  deducted  in
computing  Distributor's Estimated Final Net Billings. In the event there are no
Measurement  Issues of such  Publication  as of such date,  the Average Net Sale
Percentage  for  purposes  of  determining  Distributor's  Estimated  Final  Net
Billings shall mean the Average Net Sale Percentage of other  Publications which
have editorial  content similar to that of the Publication  (e.g., all Word-Find
Publications, all Crossword Publications, or all Wrestling Publications), and if
there are no such similar Publications, Average Net Sale Percentage for purposes
of determining Distributor's Estimated Final Net Billings shall mean the Average
Net Sale Percentage of all Publications  with the same publication  frequency as
that of such Publication as of such Completion of Shipping,  and if there are no
Publications  with the same publication  frequency as that of such  Publication,
Average Net Sale Percentage for purposes of determining  Distributor's Estimated
Final  Net  Billings  shall  mean  the  Average  Net  Sale   Percentage  of  all
Publications.  When the  context  requires,  Distributor's  Estimated  Final Net
Billings shall be calculated  separately for Foreign Distributor's Sales Outlets
as a group and for non-Foreign Distributor's Sales Outlets as a group.

     (g) "Distributor's Sales Outlets" shall mean customers of DISTRIBUTOR.

     (h) "Effective Date" shall mean July 1, 2008

                                       4
<PAGE>

     (i)  "Exchange  Act" shall mean the  Securities  Exchange  Act of 1934,  as
amended.

     (j) "Exchange  Rate" shall mean the cash (as  contrasted  with the forward)
rate at which a currency  other  than U.S.  Dollars  is  convertible  into U. S.
Dollars,  as published  in the Exchange  Rates table (or  comparable  table,  if
renamed)  of the  Wall  Street  Journal,  or if such  information  is no  longer
published  in such  newspaper,  as published  by Telerate  Systems,  and if such
information  is no longer  published  by  Telerate  Systems,  by such  reputable
financial  information  publishing  company as may be mutually  agreeable to the
parties.

     (k)  "Measurement  Issues"  with  respect  to  a  calculation  date  and  a
Publication  shall mean (i) the last three (3) issues of such  similarly  priced
Publication if such Publication is published  monthly or more  frequently,  (ii)
the last two (2) issues of such similarly priced Publication if such Publication
is published at least quarter  annually but not as  frequently  as monthly,  and
(iii) the last issue of such similarly priced Publication if such Publication is
published less frequently than quarter annually, in each such case as to which a
Settlement  Payment  Publisher  Statement  (as  defined  in  Paragraph  15),  or
comparable  such  statement  if rendered by another  distributor  or pursuant to
another distribution agreement,  has been issued prior to such calculation date.
In any case where Settlement  Payment  Publisher  Statements (or such comparable
statements as the case may be) for fewer than the indicated number of issues are
available,  the  Measurement  Issues  shall  refer to such  fewer  issues as are
available"

     (l) "Net Billings"  with respect to each issue of a Publication  shall mean
Publisher's  Gross Billings with respect to such issue, less Return Credits with
respect to such issue.

     (m) "Notice" shall mean a communication  between the parties which conforms
to the requirements of Paragraph 25.

                                       5
<PAGE>

     (n) "Off-Sale Date" with respect to each issue of a Publication  shall mean
the On- Sale  Date of such  Publication's  next  issue,  or such  other  date as
designated  by  PUBLISHER  that all  copies of such  issue are  scheduled  to be
removed from retail outlets for sale to the general public.

     (o) "On-Sale  Date" with respect to each issue of a Publication  shall mean
the date  designated  by PUBLISHER  that such issue is scheduled to be placed in
retail outlets for sale to the general public.

     (p)  "Outside  Deadline  for  Returns"  with  respect  to each  issue  of a
Publication  shall mean [***]  days  after the  Off-Sale  Date of such issue for
non-Foreign  Distributor's Sales Outlets, and [***] days after the Off-Sale Date
of such issue for Foreign Distributor Sales Outlets.

     (q) "Person" shall mean an individual,  a  corporation,  a partnership,  an
association,  a joint stock company,  a joint venture,  an estate,  a trust,  an
unincorporated   organization  or  a  government,   governmental   unit  or  any
subdivision thereof or any other entity.

     (r)  "Printer's  Completion  Notice"  with  respect  to  each  issue  of  a
Publication  shall mean a notice  delivered  to  DISTRIBUTOR  and executed by an
appropriate representative of the printer of such issue, which shall specify the
number  of  copies  of such  issue  shipped  in  accordance  with  DISTRIBUTOR'S
instructions, and the date of completion of such shipping.

     (s) "Publisher's  Billing Price" with respect to each copy of each issue of
a  Publication  shall be in an  amount  equal  to  [***]  of Cover  Price of all
Publications.

     (t)  "Publisher's   Gross  Billings"  with  respect  to  each  issue  of  a
Publication shall mean the product of Publisher's  Billing Price with respect to


                                       6
<PAGE>

such  issue  multiplied  by  the  number  of  copies  distributed  hereunder  in
accordance with the Printer's Completion Notice with respect to such issue.

     (u)  "Publication(s)"  shall  mean the  title(s)  listed  on  Schedule  "A"
attached hereto including any "one-shots,"  annuals or titles derived therefrom,
as  amended  from time to time to include  any  additional  titles  subsequently
covered by the terms  hereof as provided  herein or as provided by  agreement of
the parties.

     (v) "RDA"  shall  mean a retail  display  allowance  offered  by  PUBLISHER
pursuant  to  a  program  to  retailers  engaged  in  the  sale  of  PUBLISHER's
Publication(s)  for  (i)  each  copy  sold  of each  Publication  and/or  (ii) a
specified  position in a retailer sales  fixture.  (w) "Returns" with respect to
each issue of a Publication shall mean any and all copies of such issue returned
for credit by Distributor's Sales Outlets pursuant to Paragraph 9 hereof and for
which DISTRIBUTOR has issued such a credit.

     (x) "Return Credit" with respect to each issue of a Publication  shall mean
the product of Publisher's  Billing Price with respect to such issue  multiplied
by the number of Returns of such issue.

     (y)  "Territory"  shall  mean the  United  States  of  America  and all its
possessions,  all Army and Fleet Post Office  designations,  and the Dominion of
Canada, and the rest of the world.

2. GRANT OF RIGHTS
   ---------------

     (a) Except as otherwise  provided in  subparagraph  (b) of this Paragraph 2
PUBLISHER  hereby  gives and  grants  to the  DISTRIBUTOR,  effective  as of the
Effective  Date and  during  the term  hereof  the sole and  exclusive  right to
purchase from PUBLISHER and to resell and  distribute  throughout the Territory,
the  Publication(s).  All purchases shall be subject to  DISTRIBUTOR's  right to


                                       7
<PAGE>

receive Return Credits for Returns as set forth in Paragraph 9 hereof.

     (b)  Notwithstanding the provisions of subparagraph (a) of this Paragraph 2
to the contrary, PUBLISHER reserves the right to

          (i)  Sell copies of the  Publication(s) to subscribers at subscription
               prices;

          (ii) Distribute,  give,  or deliver  to  individuals  without  cost or
               compensation  copies  of any of the  Publication(s)  as part of a
               promotional campaign for such Publication(s); and

          (iii) Sell copies of the  Publication(s),  directly or indirectly,  to
               chains of retailers not serviced by DISTRIBUTOR or  Distributor's
               Sales Outlets on the Effective Date; provided,  however,  that if
               during  the  term   hereof,   such   service  is   commenced   to
               substantially   all  of  the  retailers  in  any  such  chain  by
               DISTRIBUTOR or  Distributor's  Sales Outlets,  and if DISTRIBUTOR
               agrees,  after deducting any RDA payment obligations with respect
               to each  issue of each  Publication  sold at such  retailers,  to
               remit to PUBLISHER with respect  thereto the same amount of money
               as PUBLISHER had been  receiving with respect to such sales prior
               thereto,   PUBLISHER  shall  commence   selling   exclusively  to
               DISTRIBUTOR  for resale to the  retailers in such chain or to the
               Distributor's   Sales   Outlets  for  ultimate   resale  to  such
               retailers,  and  pursuant  to the terms  hereof  (except  as such
               payment amount by  DISTRIBUTOR  to PUBLISHER may be  inconsistent
               with that set forth on Schedule "A"  attached  hereto as a result


                                       8
<PAGE>

               of the terms of this section  (iii)) upon  expiration of any then
               existing distribution  agreement with respect to such chain(s) of
               retailers.

3. TERM AND EVENTS OF DEFAULT
   --------------------------

     (a) Except as otherwise  provided in subparagraphs  (b), (d) or (f) of this
Paragraph 3, the term of this Agreement shall be for a period  commencing on the
Effective  Date, and ending on June 30, 2011. The rights and  obligations of the
parties under this  Agreement  shall include and be deemed to include all issues
of all  Publication(s),  the respective  On-Sale Date(s) of which occur prior to
the termination hereof ("Covered Issues").  Any and all of the respective rights
and  obligations of the PUBLISHER and  DISTRIBUTOR  under this  Agreement  shall
survive its termination for the purposes of distributing  Covered Issues, and of
handling and crediting Returns and making payments, adjustments and credits with
respect to Covered  Issues.  Termination of this Agreement  shall not affect any
right of either  party to  receive  any money owed by the other  hereunder,  the
amount of which shall be  calculated  in the manner  which would have  otherwise
been required hereby, absent such termination.

     (b)  Notwithstanding any other provision of this Agreement to the contrary,
either party may terminate  this  Agreement upon thirty (30) days' Notice to the
other upon the occurrence or existence of an Event of Default by the other party
of the type referred to in subparagraph  (c)(i), (ii) or (vii) of this Paragraph
3; or upon three (3) days' Notice to the other upon the  occurrence or existence
of an  Event  of  Default  by  the  other  party  of  the  type  referred  to in
subparagraph  (c)(iii),  (iv),  (v),  or (vi) of this  Paragraph  3, or upon the
failure of a party to pay an arbitration award within the time period prescribed
in subparagraph 28(c).

                                       9
<PAGE>

     (c) For  purposes of this  Agreement,  each of the  following  events shall
constitute  an Event of Default  by the party as to which  such event  refers or
pertains:

          (i) any representation or warranty made by such party herein or in any
     written  statement  or  written  representation  shall  prove to have  been
     incorrect when made in any respect material to this Agreement; or

          (ii) Such party  shall fail to perform  in any  material  respect  any
     term,  covenant or agreement  contained in this Agreement (other than those
     set forth in Paragraph 15, those set forth in subparagraph 24(b), and those
     subject  to a  pending  dispute  being  resolved  pursuant  to the terms of
     Paragraph  28) on its part to be  performed  or  observed if such a failure
     shall remain  unremedied for [***] days after Notice thereof from the other
     party,  unless such failure cannot reasonably be expected to be remedied in
     such [***] day  period,  in which case such party  shall fail  within  such
     [***] day period to  commence  such remedy and or proceed  diligently  with
     respect thereto;  provided,  however,  that in no event shall any such cure
     period extend beyond [***] days after such Notice; or

          (iii) Such party  shall  generally  be unable to pay its debts as such
     debts become due, or shall admit in writing its  inability to pay its debts
     generally, or shall make a general assignment for the benefit of creditors;
     or a  proceeding  shall be  instituted  by or  against a party  seeking  to
     adjudicate it a bankrupt or insolvent, or seeking liquidation,  winding up,
     reorganization, arrangement, adjustment, protection, relief, or composition
     of it or its debts under any law  relating  to  bankruptcy,  insolvency  or
     reorganization  or relief of debtors,  or seeking the entry of an order for


                                       10
<PAGE>

     relief or the appointment of a receiver, trustee, or other similar official
     for it or for any substantial  part of its property if any such involuntary
     proceeding  is not  dismissed  within sixty (60) days;  or such party shall
     take any  corporate  action to authorize any of the actions set forth above
     in this subsection (iii); or

          (iv)  any  judgment  creditor  shall  have  commenced  an  enforcement
     proceeding against such party pursuant to a judgment or order of a court of
     competent  jurisdiction  after lawful service for the payment of money (not
     fully covered by insurance) in excess of Two Hundred Fifty Thousand Dollars
     ($250,000) which enforcement proceeding was not stayed prior to the seizure
     of any such party's  assets,  which  seizure was not reversed by the timely
     filing of an appeal thereof. For purposes of this section (iv) the creation
     of a lien by entry of such a judgment or order shall not itself  constitute
     such a seizure.

     For  purposes  of  this  Agreement,  each  of the  following  events  shall
     constitute an Event of Default by DISTRIBUTOR:

          (v) DISTRIBUTOR  shall default,  violate,  or be in breach of any loan
     document which  provides,  or which together with other such loan documents
     provides,  working capital or accounts receivable financing for DISTRIBUTOR
     or DISTRIBUTOR's business and such default, violation, or breach results in
     the  termination  of such  financing  at a time  when  no such  replacement
     financing  or  working  capital  is  available  to  DISTRIBUTOR  in amounts
     comparable to that terminated;

                                       11
<PAGE>

          (vi) Each of the events  constituting an Event of Default as set forth
     in subparagraph (e)(ii)(E) of this Paragraph 3; and

          (vii)   DISTRIBUTOR   shall  fail  [***]  times  in  any  twelve  (12)
     consecutive month period to perform in any material respect its obligations
     set forth in subparagraph  24(b), and such failure shall remain uncured for
     [***] days after Notice thereof from PUBLISHER;  or DISTRIBUTOR  shall fail
     any single  time to perform in any  material  respect its  obligations  set
     forth in subparagraph  24(b) and as to which  DISTRIBUTOR shall have failed
     to make reasonable  efforts to commence a cure thereof during the [***] day
     period after Notice of such failure is given by PUBLISHER to DISTRIBUTOR.

     (d)  Notwithstanding the provisions of subparagraph (a) of this Paragraph 3
to the contrary,  the term of this  Agreement  shall be  automatically  extended
beyond the June 30, 2011 termination  date referred to in such  subparagraph (a)
for an  extension  period  of three (3)  years;  provided,  Publisher  agrees in
writing to such  extension 180 days prior to the  expiration of the then current
term.

     (e) (i) Notwithstanding any language to the contrary in the balance of this
Paragraph  3,  PUBLISHER  and  DISTRIBUTOR  agree  that the  provisions  of this
subparagraph  (e) shall  exclusively  govern with regard to the  procedures  for
collection  of any sum actually or allegedly due from  DISTRIBUTOR  to PUBLISHER
under any of the provisions of this Agreement. Accordingly, no alleged or actual
failure by  DISTRIBUTOR  to make any  payment to  PUBLISHER  shall in any manner
constitute  an Event of Default  except as provided  in section  (ii)(E) of this
subparagraph (e).

                                       12
<PAGE>

          (ii) The following procedures shall govern that portion of any Initial
     Advance Payment,  Settlement Payment, or GST refund as to which there is no
     dispute or contest between the parties:

               (A) If PUBLISHER shall not have received  DISTRIBUTOR's  check in
          the amount  determined  by  DISTRIBUTOR  to be owed to PUBLISHER as an
          Initial Advance  Payment or as a Settlement  Payment or as a refund of
          GST net of deductions as solely determined by DISTRIBUTOR  pursuant to
          the terms of Paragraph  15,  ("Missing  Check") on or before the [***]
          business  day after it was to have been  paid in  accordance  with the
          provisions of subparagraph 15(a)(i), 15(a)(ii), or 15(k) as applicable
          (the  "Mailing  Date"),  PUBLISHER  may  give  Notice  to  DISTRIBUTOR
          identifying the  Publication(s) and Mailing Date(s) for which there is
          a Missing Check ("Notice of Non-Receipt").

               (B) If PUBLISHER  shall not have  received a Missing  Check on or
          before the [***]  business day after its Mailing  Date,  PUBLISHER may
          give Notice to DISTRIBUTOR of nonpayment  with respect to such Missing
          Check  ("Notice of Non-  Payment") on or after the [***]  business day
          after the giving of a Notice of Non-Receipt with respect thereto.

               (C) DISTRIBUTOR  shall wire funds to replace any Missing Check on
          or before the second business day after the Notice of Non-Payment with


                                       13
<PAGE>

          respect  to such  Missing  Check  was given to  DISTRIBUTOR  ("Delayed
          Payment  Date")  unless such Missing  Check was  actually  received by
          PUBLISHER  on or  before  such  Delayed  Payment  Date  and a  receipt
          therefor,  signed  by a  PUBLISHER  representative,  shall  have  been
          obtained by DISTRIBUTOR.

               (D) If  PUBLISHER  shall  have  given  DISTRIBUTOR  a  Notice  of
          Non-Payment  and a Notice of  Non-Receipt  with  respect  to a Missing
          Check, and if DISTRIBUTOR shall fail to wire funds to PUBLISHER in the
          amount of such Missing Check on or before the Delayed  Payment Date in
          accordance  with the terms of  subsection  (C) of this  section  (ii),
          PUBLISHER may give Notice to DISTRIBUTOR  of the Final  Opportunity to
          Cure Default (the "Final Notice"). DISTRIBUTOR shall wire funds in the
          amount of the Missing Check on or before the [***]  business day after
          the Final Notice was given (the "Outside Date").

               (E) It shall constitute an Event of Default, if

                    (x)  PUBLISHER  shall have  given the  Notices  required  in
               subsections  (A),  (B),  and (D) of  this  section  (ii),  and if
               DISTRIBUTOR  shall fail to wire funds to  PUBLISHER in the amount


                                       14
<PAGE>

               of a Missing  Check as to which a Final  Notice has been given on
               or before the Outside Date; or

                    (y)  If  in  any  consecutive   twelve  (12)  month  period,
               PUBLISHER  shall have given the Notices  required in  subsections
               (A) and (B) of this  section (ii) and  DISTRIBUTOR  shall fail to
               mail its check in the amount as an Initial  Advance Payment or as
               a Settlement Payment or as a GST refund determined by DISTRIBUTOR
               to be owed  PUBLISHER net of  deductions as solely  determined by
               DISTRIBUTOR  pursuant  to  the  terms  of  Paragraph  15  on  the
               applicable  Mailing Date or shall fail to wire funds to PUBLISHER
               to  replace  the  amount of such  Missing  Check on or before its
               Delayed  Payment Date (either such  occurrence,  a "Late  Payment
               Event") a number of times  equal to the greater of (I) the number
               of Publications  covered by this Agreement on the day of the Late
               Payment Event, or (II) [***].

A Late Payment Event may not be counted towards an Event of Default if PUBLISHER
did not send DISTRIBUTOR  Notices of Non-Receipt and Non-Payment related thereto
in accordance with the terms of this subparagraph (e). There shall be rebuttable


                                       15
<PAGE>

presumptions  that a check payable to the order of PUBLISHER  which was produced
by  DISTRIBUTOR in the ordinary  course of its business was actually  mailed the
day of such  production,  and that a  negotiable  check  payable to the order of
PUBLISHER  dated on or before the Mailing  Date which was  actually  received by
PUBLISHER  within  [***]  business  days of the  Mailing  Date was mailed on the
Mailing Date.

                    (F) Notwithstanding the foregoing, in no circumstances shall
               an Event of Default be deemed to have occurred unless the Missing
               Check is in the  amount of [***] or more,  in which case any such
               unpaid  amount shall be governed by the terms of section (iii) of
               this  subparagraph (e). Also, it shall not constitute an Event of
               Default if the amount  shown to be due on a  Publisher  Statement
               (as hereinafter  defined) is equal to the amount of DISTRIBUTOR's
               check tendered to PUBLISHER in payment with respect thereto.

               (iii) The  following  procedures  shall  govern any payment as to
          which there is a dispute or contest between the parties.  Any claim by
          PUBLISHER

                         (A) that the amount paid by  DISTRIBUTOR  as an Initial
                    Advance   Payment  or  Settlement   Payment  as  reduced  by
                    deductions taken therefrom by DISTRIBUTOR was incorrect;

                         (B) that the information shown on a Publisher Statement
                    was incorrect;

                                       16
<PAGE>

                         (C)  that an  Initial  Advance  Payment  or  Settlement
                    Payment  was not made  because  the  information  shown on a
                    Publisher Statement was incorrect;

                         (D) that  DISTRIBUTOR's  demand for payment pursuant to
                    subparagraph 15(e) or (h) is incorrect;

                         (E) for Missing Checks of less than [***] each or

                         (F) for any alleged  non-payment by  DISTRIBUTOR  other
                    than as provided in section (ii) of this subparagraph (e),

               shall  be  subject  to  the  dispute  resolution   provisions  of
          Paragraph 28.

               (iv) Each Notice given by PUBLISHER  to  DISTRIBUTOR  pursuant to
          the terms of this  subparagraph  (e) shall be clearly  marked with the
          boldface  legend,   "NOTICE  PURSUANT  TO  NON-PAYMENT  PROCEDURES  OF
          DISTRIBUTION  AGREEMENT";   shall  not  be  included  with  any  other
          information  being  communicated  to  DISTRIBUTOR  other than  another
          Notice given  pursuant to the terms of this  subparagraph  (e);  shall
          identify the Publications and Mailing Date to which it refers;  and in
          the case of a Notice of Non-Payment and a Final Notice,  the necessary
          instructions  by which  DISTRIBUTOR is to wire the necessary  funds to
          PUBLISHER.  Notice  failing to comply  with the terms of this  section
          (iv) shall be deemed null and void and not to have been  delivered  to
          DISTRIBUTOR.

     (f)  Notwithstanding any other provision of this Agreement to the contrary,
PUBLISHER  may  terminate  this  Agreement if at any time during the term hereof
either

                                       17
<PAGE>

               (i) some or all of the voting securities of DISTRIBUTOR or all or
               substantially all of the assets of DISTRIBUTOR are sold to

                         (A) a distributor  in the business of buying  magazines
                    from  publishers  for  resale  to, or acting as an agent for
                    publishers  in the sale or other  distribution  of magazines
                    to,  wholesalers or retailers of magazines (a  "Competitor")
                    or

                         (B) to a Person  which is not a  Competitor,  but which
                    has a net worth or shareholders,  equity of less than Thirty
                    Million Dollars ($30,000,000); or

               (ii) DISTRIBUTOR merges or consolidates with or into

                         (A) any Competitor or

                         (B) any Person of the type  described  in  subparagraph
                    (f)(i)(B) of this  Paragraph 3 . To terminate  the Agreement
                    pursuant to the terms of this  subparagraph  (f),  PUBLISHER
                    shall give Notice to  DISTRIBUTOR  of such  termination  not
                    more than  ninety (90) days after the date of any such sale,
                    merger,  or  consolidation.  Such  Notice  shall  specify  a
                    specific  termination  date  (which  may  but  shall  not be
                    required  to be within  such  90-day  period)  not less than
                    fifteen  (15) nor more than  forty-five  (45) days after the
                    date of such Notice.

4. PUBLISHER REPRESENTATIONS
   -------------------------

                                       18
<PAGE>

     (a) PUBLISHER represents and warrants that (i) it is the sole and exclusive
owner  of  all  rights,  including  but  not  limited  to,  copyrights,  titles,
trademarks,   tradenames,  trade  dress,  logos  and  formats,  in  and  to  the
Publication(s)  (collectively,  the "Rights")and that the Rights are not subject
to any liens or  encumbrances  of any nature other than as set forth on Schedule
"C" attached hereto; (ii) the rights herein granted to DISTRIBUTOR have not been
granted to any other person, firm, or corporation with respect to any portion of
the term  hereof;  (iii) it has the  right  and  authority  to enter  into  this
Agreement and to perform the obligations hereunder to be performed by PUBLISHER;
(iv) there are no existing contracts,  agreements or other arrangements which in
any way whatsoever prevent or interfere with the PUBLISHER's making and entering
into  this  Agreement  or  performing  hereunder;  and (v)  that to the  best of
PUBLISHER's  knowledge,  there are no suits or proceedings pending or threatened
against or affecting PUBLISHER which, if adversely determined,  would impair the
rights  herein  granted to  DISTRIBUTOR  or prevent  PUBLISHER  from  performing
hereunder.

     (b) PUBLISHER  represents and agrees that all issues of the  Publication(s)
shall conform  substantially to the respective existing copies thereof exhibited
by PUBLISHER to DISTRIBUTOR;  provided,  however,  that PUBLISHER may change the
size, page count, contents,  format, or Cover Price of any Publication from time
to time during the term hereof if PUBLISHER  believes  that any such change will
inure to the best interests of any of the Publication(s) or of PUBLISHER.


5. FIRST OPTION
   ------------

                                       19
<PAGE>

     (a) DISTRIBUTOR  shall have the first option to purchase from PUBLISHER and
to resell and distribute any and all newly published periodicals or publications
intended to be published by PUBLISHER  during the term of this  Agreement on the
same terms and conditions as set forth in this Agreement. DISTRIBUTOR shall also
have the first option to purchase from  PUBLISHER  and to resell and  distribute
any and all additional  periodicals or publications  acquired by and intended to
be published by PUBLISHER  during the term of this  Agreement,  either (i) after
the expiration of any  distribution  contract with any other party covering such
periodicals and  publications and thereafter on the same terms and conditions as
set  forth in this  Agreement  or (ii) as set  forth in any  other  distribution
contract then in effect with any other distributor  covering the distribution of
such periodicals and publications  until the expiration of its then current term
and thereafter on the same terms and conditions as set forth in this  Agreement.
PUBLISHER shall promptly give DISTRIBUTOR Notice of its intention to publish and
distribute any such additional periodicals or publications and DISTRIBUTOR shall
within  fifteen  (15) days after  receipt of such  Notice,  advise  PUBLISHER of
whether it is willing to distribute such additional periodicals or publications.
If DISTRIBUTOR is willing to do so, each such periodicals or publications  shall
thereafter  be deemed to be a  Publication,  and shall be  governed by the terms
hereof. If DISTRIBUTOR is unwilling to distribute such additional periodicals or
publications,  PUBLISHER  shall  have the  right  and  option  to have each such
periodicals  or  publications  thereafter  distributed  by another  distributor,
without liability to DISTRIBUTOR hereunder.

     (b) In the event  PUBLISHER  exercises  its  option to have the  additional
periodicals or publications  referred to in subparagraph (a) of this Paragraph 5


                                       20
<PAGE>

which   DISTRIBUTOR   is  unwilling  to   distribute,   distributed  by  another
distributor,  and PUBLISHER  receives on a net basis, less for sale of issues of
such  additional   periodicals  or  publications  from  such  other  distributor
performing  the same type of  distribution  services than it would have received
from DISTRIBUTOR pursuant to the terms of this Agreement,  DISTRIBUTOR shall pay
such difference to PUBLISHER thirty (30) days after  DISTRIBUTOR's  receipt of a
copy  of each  settlement  statement  received  by  PUBLISHER  from  such  other
distributor,  subject to  DISTRIBUTOR's  right to audit same and being  supplied
with all information  reasonably  necessary to calculate  and/or verify any such
sums owed. Notwithstanding the foregoing, no such sums shall be due PUBLISHER

          (i) if the  financial  arrangements  between  PUBLISHER and such other
     distributor is the result of bad faith or collusion  between  PUBLISHER and
     such other distributor, or

          (ii) with  respect to any time period  after the  termination  of this
     Agreement.

When the term of any distribution agreements with any such other distributor has
been  completed  and prior to any renewal or new term's taking  effect,  if this
Agreement has not then been terminated,  PUBLISHER shall again offer DISTRIBUTOR
the right to distribute such additional  periodicals or publications on the same
terms and conditions as set forth in this Agreement,  and if DISTRIBUTOR remains
unwilling to distribute such additional periodicals or publications, DISTRIBUTOR
shall  continue  to pay the  amounts  required  pursuant  to the  terms  of this
subparagraph  (b).  If  PUBLISHER  fails  to  offer  DISTRIBUTOR  the  right  to


                                       21
<PAGE>

distribute such additional  periodicals or  publications(s) no sums shall be due
PUBLISHER  pursuant  to the  terms of this  subparagraph  (b) from and after the
termination date of such other distribution agreement.

6. NUMBER OF COPIES, FREQUENCY, AND COVER DESIGNATIONS
   ---------------------------------------------------

     (a) The  number of copies of each issue of each  Publication  to be printed
shall be as PUBLISHER and  DISTRIBUTOR  shall  mutually  agree upon,  and in the
absence of such  agreement,  the product of four (4) multiplied by the aggregate
Publisher's  Gross  Billings and divided by the  aggregate  Publisher's  Billing
Prices for the Measurement Issues of such Publication, determined as of the date
immediately prior to the making of the print order.

     (b) PUBLISHER  agrees to deliver,  or promptly  cause to be delivered,  the
specified number of copies of each issue of the Publication(s) with the assigned
bipad  number and  Universal  Product  Code Symbol to each  Distributor's  Sales
Outlet  designated by  DISTRIBUTOR  in accordance  with  DISTRIBUTOR's  shipping
instructions.

     (c)  PUBLISHER  may,  without  incurring any  liability to  DISTRIBUTOR  on
account thereof, in the exercise of its sole discretion, change the frequency of
publication  of any of the  Publication(s)  from  time to time  during  the term
hereof,  and may, in the  exercise of its sole  discretion,  determine  to cease
publication or production of any Publication either temporarily or permanently.

7. TRANSPORTATION AND RELATED COSTS
   --------------------------------
     PUBLISHER  shall pay  directly  all  transportation  and  insurance  costs.
Canadian GST, import-export charges or tariffs and other duties, relating to the
shipment of each issue of the  Publication(s)  to  Distributor's  Sales  Outlets
shall be advanced by DISTRIBUTOR  and deducted from amounts payable to PUBLISHER


                                       22
<PAGE>

as Settlement  Payments  (except as to Canadian GST which shall be deducted from
Initial  Advance  Payments  and repaid to PUBLISHER  by  DISTRIBUTOR  [***] days
thereafter).

8. PUBLISHER'S BILLING PRICE; FOREIGN CURRENCY
   -------------------------------------------

     (a) The Publisher's  Billing Price shall  initially be calculated  based on
the Cover Price of the Publication as set forth on Schedule "A" attached hereto;
provided, however, that upon any change in the Cover Price of a Publication, the
Publisher's  Billing  Price shall  correspondingly  change  automatically  as to
issues with the changed  Cover  Price so that the ratio of  Publisher's  Billing
Price to Cover Price shall remain  consistent  with that determined by reference
to Schedule "A," as amended to the date of such change.

     (b) All moneys which may be due to PUBLISHER  pursuant to the terms of this
Agreement  shall be paid in U. S. Dollars.  All amounts owed by  DISTRIBUTOR  to
PUBLISHER for sales in Canada or in a Foreign country shall be calculated at the
Exchange Rate as of the third day prior to the date of any such payment.

9. RETURNS
   -------
     (a)  DISTRIBUTOR has the option and is authorized to accept as Returns from
Distributor's  Sales  Outlets  whole  copies,  front  covers,  headings of front
covers,  and affidavits or statements of returns including those  electronically
transmitted,  of the Publication(s).  Except as set forth in subparagraph (c) of
this Paragraph 9, DISTRIBUTOR has the exclusive right to determine the method of
return from Distributor's Sales Outlets.  DISTRIBUTOR is specifically authorized
by  PUBLISHER to destroy or arrange for the  destruction  of said Returns at any
time after receiving same in any manner deemed  suitable by DISTRIBUTOR,  unless
at  least  thirty  (30)  days  prior  to the  On-Sale  Date of any  issue of the


                                       23
<PAGE>

Publication(s),  PUBLISHER  shall  have given  DISTRIBUTOR  Notice in writing of
PUBLISHER's  request that the Returns of such issue be held for thirty (30) days
after the date of the Settlement  Payment with respect thereto so that PUBLISHER
can audit such Returns at its own cost and expense. Such audit and count must be
made by PUBLISHER  during such thirty (30) day period at the particular place of
storage  thereof  maintained  at such  time by  DISTRIBUTOR,  or at  PUBLISHER's
request,  by particular  Distributor's  Sales Outlets.  PUBLISHER  agrees not to
request more than one such audit per year per Publication unless, as a result of
two (2) or more prior such audits,  substantial discrepancies were discovered by
PUBLISHER.

     (b) In the event  that  DISTRIBUTOR  has not  received  all  Returns of any
issue(s)  distributed  hereunder  from any of the  Distributor's  Sales  outlets
because  such outlet (i) is subject to the  appointment  of a receiver,  (ii) is
adjudicated  a bankrupt  after filing of a petition of voluntary or  involuntary
bankruptcy,  (iii) is  reorganized  or  managed  by a trustee  or  committee  of
creditors under the Federal Bankruptcy Act, (iv) is dissolved, terminated, or no
longer in business,  (v) is destroyed by fire, flood or other disaster,  or (vi)
is unable to return all unsold copies of any such issue due to strikes, lockouts
or other labor disputes,  then DISTRIBUTOR shall be entitled to charge PUBLISHER
for  Returns  from such  Distributor's  Sales  Outlet in an amount  equal to the


                                       24
<PAGE>

product of the  difference  between one (1) and the Average Net Sale  Percentage
with respect to the  Measurement  Issues  (calculated  as of the  earliest  date
related to the event  described  in this  subparagraph  (b)  giving  rise to the
inability to receive all such Returns and calculated  separately with respect to
the Distributor's  Sales outlets as to which any such event applies)  multiplied
by the number of copies  received by such  Distributor's  Sales  Outlet for such
issue(s). Nothing contained in this subparagraph (b) shall be or be deemed to be
a  limitation  on the  provisions  of Paragraph 21 with respect to copies of any
issue of a Publication for which DISTRIBUTOR is required to bear any losses from
uncollectible  accounts,  or the fees, costs, or expenses incurred for attempted
collection thereof.

     (c) In the event PUBLISHER desires to receive whole copy Returns, Notice of
the quantities  thereof desired and the address to which such whole copy Returns
shall be sent shall be  supplied to  DISTRIBUTOR  not less than thirty (30) days
prior to the On-Sale Date of such issue.  PUBLISHER shall pay DISTRIBUTOR at the
rate of [***] per copy for packing  and  handling  costs for whole copy  returns
received by  DISTRIBUTOR,  and PUBLISHER  shall  reimburse  DISTRIBUTOR  for all
direct  costs  incurred  by  DISTRIBUTOR,  including  all  shipping  costs,  all
container  costs,  and all costs  charged by  Distributor's  Sales  Outlets  for
arranging,  receiving and  delivering  such whole copy Returns.  Upon receipt of
such Notice requesting whole copy returns, the sole obligation of DISTRIBUTOR in
this regard  shall be to make  written  request for the same from  Distributor's
Sales Outlets,  it being  understood  and agreed that nothing  herein  contained
shall require DISTRIBUTOR to take any other action with respect to such request.

10. RDA
    ---

     (a)  DISTRIBUTOR is authorized to offer on PUBLISHER's  behalf  PUBLISHER's
RDA  Program.   PUBLISHER  agrees  to  delineate  the  terms,  provisions,   and
limitations  thereof,  and to execute  any  documents  reasonably  necessary  in
connection  therewith.  PUBLISHER may, on a prospective  basis,  discontinue any
such RDA Program at any time upon thirty (30) days' Notice to DISTRIBUTOR,

                                       25
<PAGE>

     (b) PUBLISHER shall act on its own account or designate an agent to pay all
amounts  due under the RDA  Program  and  PUBLISHER  shall pay to such  agent on
demand any and all amounts  paid or due to be paid by such agent on  PUBLISHER's
behalf to retailers  participating  in such RDA Program.  DISTRIBUTOR  agrees to
serve as such agent, if requested to do so by PUBLISHER in writing.  Even if not
so designated,  DISTRIBUTOR  shall provide the information and support otherwise
required pursuant to the terms of this Paragraph 10 without charge.

     (c) All RDA payments on behalf of PUBLISHER shall be combined with payments
due to retailers  from  Affiliates  of PUBLISHER and will be paid by such paying
agent.

     (d)  PUBLISHER  shall  provide  DISTRIBUTOR  with  blank  checks  on a form
mutually  agreeable to PUBLISHER and DISTRIBUTOR so that DISTRIBUTOR can produce
the checks for  signature  and mailing by such agent to the  retailers  or their
consultants.  The  checks  shall  show data  consistent  with that  provided  by
DISTRIBUTOR  to retailers for  comparable  programs  offered by other  publisher
clients administered by DISTRIBUTOR.  Alternatively,  at PUBLISHER'S request and
option, DISTRIBUTOR shall, in lieu of drawing and producing such checks, deliver
to PUBLISHER  (or  PUBLISHER'S  agent) all such  information  as is available to
DISTRIBUTOR  in such  electronically  encoded form as is used by  DISTRIBUTOR in
producing such checks.

     (e) DISTRIBUTOR shall issue an RDA claim form to participating retailers on
PUBLISHER'S behalf in a form reasonably acceptable to DISTRIBUTOR and PUBLISHER.
When the claim forms are received from the participating  retailers  DISTRIBUTOR
will process them in the same manner as all other claims received by DISTRIBUTOR


                                       26
<PAGE>

for its other publisher  clients,  including all audit programs,  and review and
verification  procedures  used by  DISTRIBUTOR.  RDA analytical  reports will be
produced  by  DISTRIBUTOR  in the same  manner  as is done for  other  publisher
clients of DISTRIBUTOR as to title, issue,  retailer and summaries of all claims
by title and issue and check registers for the payments to be made.

     (f)  DISTRIBUTOR is authorized to offer on PUBLISHER's  behalf  PUBLISHER's
Advance  RDA  Program to the  retailers  approved  in writing by  PUBLISHER  and
participating  in such  Advance RDA  Program.  The  Advance RDA Program  will be
administered  for  PUBLISHER's  issues  subject to the Advance RDA Program  (the
"Advance RDA Issues") in accordance with the following  terms,  provisions,  and
limitations:

          (i)  The initial  Advanced RDA (the  "Advanced  RDA") will be based on
               final  sales  of  issues  on sale as  provided  to  PUBLISHER  by
               DISTRIBUTOR.  PUBLISHER will calculate and provide to DISTRIBUTOR
               in writing the initial monthly Advanced RDA per title and issue.

          (ii) DISTRIBUTOR will invoice  PUBLISHER for Advanced RDA on the first
               day of each  month for  Advance  RDA Issues on sale  during  such
               month.  Such  invoice  will be in  accordance  with  Exhibit  "X"
               attached  hereto and made a part hereof.  Payment by PUBLISHER to
               DISTRIBUTOR  for the  invoiced  Advanced RDA amount is due by the
               last day of such month.

          (iii) Any  additions  or  deletions  of  Retailers   participating  in
               PUBLISHER's  Advance  RDA  Program is to be first  agreed upon in


                                       27
<PAGE>

               writing  by the  parties  thereto  with  such  written  agreement
               thereupon becoming an Amendment to this Agreement

          (iv) By the last  business day of the fifth  calendar  month after the
               end of  each  calendar  year  quarter  during  the  term  of this
               Agreement  DISTRIBUTOR  will reimburse  PUBLISHER for all monthly
               Advanced RDA payments  paid by  PUBLISHER to  DISTRIBUTOR  during
               such   quarter.    Following   DISTRIBUTOR's   payment   of   the
               aforementioned  reimbursement,  DISTRIBUTOR may invoice PUBLISHER
               solely for amounts actually claimed for such reimbursed quarterly
               period.  PUBLISHER  will pay  DISTRIBUTOR's  invoice within [***]
               days of receipt thereof.  PUBLISHER  reserves the right to deduct
               from subsequent  payment of DISTRIBUTOR's  invoice(s)  amounts in
               dispute due to errors made by  DISTRIBUTOR in calculation of such
               amounts based on  PUBLISHER's  review of sales data  accompanying
               each  invoice.  DISTRIBUTOR  will supply to  PUBLISHER  with each
               invoice a report in hard copy and excel  file  format in the form
               of  Exhibit  "Y"  attached   hereto   showing  by  retail  chain,
               wholesaler,  title and issue the final sales of the  Advanced RDA
               Issues reflected in the invoice.

          (v)  Using  sales  data  available  to  it,  PUBLISHER  shall  provide
               Distributor  with  adjustments to Advanced RDA by submitting such
               adjustments in writing to DISTRIBUTOR ten (10) days in advance of
               the 1st day of the month.  PUBLISHER's  Advanced RDA  adjustments


                                       28
<PAGE>

               shall be adjusted by DISTRIBUTOR  in its next monthly  invoice to
               PUBLISHER for Advanced RDA. DISTRIBUTOR may only make adjustments
               to Advanced RDA with the prior written consent of PUBLISHER.

     (g)  DISTRIBUTOR agrees to provide PUBLISHER with the following services in
          PUBLISHER's performance of audits of RDA programs:

          (i)  DISTRIBUTOR  will assist  PUBLISHER in up to [***] RDA audits per
               year.  This  assistance  will  include  the use of  DISTRIBUTOR's
               regional  and/or district field personnel as mutually agreed upon
               by DISTRIBUTOR and PUBLISHER.

          (ii) Upon reasonable  request of PUBLISHER,  DISTRIBUTOR  will provide
               PUBLISHER  with  all RDA  data  pertinent  to  PUBLISHER  that is
               available in DISTRIBUTOR's system.

11. DISCOUNTS AND ALLOWANCES
    ------------------------

     PUBLISHER  shall pay  DISTRIBUTOR,  as deductions  from amounts  payable to
PUBLISHER as Settlement  Payments,  for any and all  discounts  and  allowances,
which  are in  excess  of  DISTRIBUTOR's  national  billing  discount  for  each
Publication,  made by  DISTRIBUTOR  to any of  Distributor's  Sales  Outlets  in
locations where special labor conditions  and/or other situations and conditions
exist causing such discounts or allowances;  provided,  however,  that PUBLISHER
has agreed to pay such  discounts  and  allowances  in advance in writing.  Such
discounts  and  allowances  in  effect  on the  Effective  Date are set forth on
Schedule "E" attached  hereto and the parties hereby agree to such discounts and
allowances.

                                       29
<PAGE>

12. RISK OF LOSS; SHORTAGES, ETC.
    -----------------------------

     (a) Any loss, shortage, destruction of, or damage to copies of any issue(s)
of each Publication  shall at all times be at the risk of and be borne solely by
PUBLISHER  until  delivery  to   Distributor's   Sales  Outlets  by  PUBLISHER'S
designated motor carrier (the "Carrier") and acceptance by  Distributor's  Sales
Outlets.  No such delivery  shall be deemed to have been accepted by Distributor
Sales Outlet if such Outlet has reported a loss or shortage in  accordance  with
the reporting procedures then in use by the Carrier.  Subject to the limitations
set forth below in this subparagraph (a) DISTRIBUTOR shall be entitled to charge
PUBLISHER's  account with DISTRIBUTOR for such copies for which  DISTRIBUTOR has
paid PUBLISHER,  and same may be deducted by DISTRIBUTOR from any sums otherwise
due  PUBLISHER.  DISTRIBUTOR  shall  provide  prompt  Notice to PUBLISHER  after
receipt of any claim for loss,  shortage,  destruction of or damage to copies of
any issues of the  Publication(s)  as to which  DISTRIBUTOR  believes  PUBLISHER
bears the risk of loss pursuant to the terms of this  subparagraph  12(a).  Upon
PUBLISHER's request,  DISTRIBUTOR shall furnish to PUBLISHER all information and
documents which  DISTRIBUTOR  may have with respect to any such loss,  shortage,
destruction  or damage,  including  without  limitation  all bills of lading and
necessary affidavits. The right and responsibility of filing any claims with the
Carrier  shall  belong  solely  to  the  PUBLISHER;   provided,   however,  that
DISTRIBUTOR  shall  assist  PUBLISHER  in the filing of any such claim and shall
execute and deliver to PUBLISHER such assignments,  waivers, and releases to and
with  respect to any such  claim as  PUBLISHER  or such  Carrier's  insurer  may
reasonably request. In the event that DISTRIBUTOR shall recover any part of such
loss,  then the  DISTRIBUTOR  shall  pay over or  credit  the same to  PUBLISHER
promptly.

                                       30
<PAGE>

     (b) From and  after  acceptance  of a  delivery  by a  Distributor's  Sales
Outlet,  DISTRIBUTOR  shall use its best efforts,  consistent  with its standard
operating  procedures,  to cause  all risk of loss to be  borne  solely  by such
Distributor's   Sales  Outlet,   except  as  otherwise   expressly  provided  in
subparagraph  9(b)(v).  If DISTRIBUTOR is  unsuccessful in doing so, such losses
shall be deducted  from amounts due PUBLISHER by  DISTRIBUTOR,  subject to later
adjustment pursuant to the terms of subparagraph (c) of this Paragraph 12.

     (c) Losses  (other than  losses  borne by the  Carrier or by  PUBLISHER  in
accordance  with the terms of  subparagraph  (a) of this  Paragraph 12) shall be
cumulated and calculated  once annually as of July 31 of each year, with respect
to issues of the Publications,  the Settlement Payment Publisher  Statements for
which have been  issued as of such date and shall be borne as between  PUBLISHER
and DISTRIBUTOR as follows:

<TABLE>
<S>       <C>                                 <C>                                <C>

                 Amount of Loss as a                  PUBLISHER'S Loss                   DISTRIBUTOR'S Loss
              Percentage of Publisher's               ----------------                   ------------------
                     Gross Billings
                  -----------------

(A)       [***] or less                       100% of the amount of the loss     0% of the amount of the loss

(B)       More than [***] but not more than   [***] of Publisher's Gross         [***] of the amount by which the
          [***]                               Billings, plus [***] of the        loss exceeds [***] of Publisher's
                                              amount by which the loss exceeds   Gross Billings and multiplied by
                                              [***] of Publisher's Gross         Average Net Sale Percentage
                                              Billings and multiplied by
                                              Average Net Sale Percentage

(C)       More than [***]                     [***] of Publisher's Gross         [***] of Publisher's Gross
                                              Billings.                          Billings plus [***] of the amount
                                                                                 by which the loss exceeds [***]
                                                                                 of Publisher's Gross Billings and
                                                                                 multiplied by Average Net Sale
                                                                                 Percentage.
</TABLE>

                                       31
<PAGE>

DISTRIBUTOR  shall be entitled to receive from  PUBLISHER an amount equal to the
total loss borne by DISTRIBUTOR  pursuant to the terms of this  subparagraph (c)
multiplied  by [***].  DISTRIBUTOR  shall  credit  PUBLISHER  with the amount of
DISTRIBUTOR's  loss minus the amount collected in the preceding sentence and add
such net amount to the next payment due to PUBLISHER hereunder.

13. PROMOTION AND SOLICITATION COSTS
    --------------------------------

     PUBLISHER  shall at its own expense  provide  DISTRIBUTOR  with  reasonable
quantities of promotional  materials for  DISTRIBUTOR's  use as to any promotion
which  PUBLISHER  desires to conduct.  PUBLISHER  shall pay  DISTRIBUTOR for all
reasonable  direct costs in connection  with all  promotional  and  solicitation
mailings  which have been  approved  by  PUBLISHER  in advance  in  writing.  If
PUBLISHER requests  DISTRIBUTOR to incur advertising or promotional  expenses on
behalf  of  PUBLISHER  or for  any of the  Publication(s),  PUBLISHER  shall  be
responsible for all such expenses.

14. MISCELLANEOUS CHARGES
    ---------------------

     PUBLISHER shall pay DISTRIBUTOR for the following charges:

     (a) For each Audit Bureau of  Circulation  ABC State  Circulation  Analysis
requested  by  PUBLISHER  [***],  and for each ABC County  Report  requested  by
PUBLISHER [***].

     (b) For reshipment charges incurred by DISTRIBUTOR at PUBLISHER's request.

     (c) Any other charges or expenses  incurred by DISTRIBUTOR  specifically on
PUBLISHER's  behalf or for its Publication(s) at PUBLISHER's  request,  provided
that all such charges or expenses shall be approved by PUBLISHER in advance.

15. PAYMENTS TO PUBLISHER
    ---------------------

                                       32
<PAGE>

     (a)  DISTRIBUTOR  shall and hereby agrees to pay PUBLISHER the Net Billings
of each issue of each Publication  distributed pursuant to this Agreement,  less
all credits to which DISTRIBUTOR shall be entitled, if any, as follows:

          (i) An "Initial Advance Payment" in an amount equal to [***] (or [***]
     with  respect to  Publications  not  previously  distributed  by a national
     distributor   and  as  to  which  there  are  no  Measurement   Issues)  of
     Distributor's  Estimated Final Net Billings with respect to such issue less
     any GST applicable to such issue and less any Over Advances (as hereinafter
     defined)  shall be paid to  PUBLISHER  on the later of [***] days after the
     Completion  of Shipping or [***] days after receipt by  DISTRIBUTOR  of the
     Printer's  Completion  Notice with respect to such issue, less any Canadian
     GST advanced by DISTRIBUTOR hereunder; and

          (ii) A "Settlement  Payment" in an amount equal to the Net Billings of
     such issue, less

               (A)  the  aggregate  amount  of  all-advance   payments  made  by
          DISTRIBUTOR  to  PUBLISHER  or for its  account  with  respect to such
          issue;

               (B) all  charges,  allowances,  discounts  and other  credits  or
          reimbursements  actually  paid  or  credited  to  Distributor's  Sales
          Outlets  or  others  by  DISTRIBUTOR  to  which  DISTRIBUTOR  shall be
          entitled  pursuant to the terms hereof, or as shall have been approved
          in advance in writing by  PUBLISHER  with  respect to such  issue,  or
          which have been  actually  paid or  credited  to  Distributor's  Sales
          Outlets or others by DISTRIBUTOR for other issues of such  Publication


                                       33
<PAGE>

          and which were not  previously  deducted from a payment by DISTRIBUTOR
          to PUBLISHER;

               (C) all  fees  and  charges  owing by  PUBLISHER  to  DISTRIBUTOR
          pursuant to the terms  hereof for services  performed  by  DISTRIBUTOR
          with respect to such Publication; and

               (D) all other  deductions  permitted  to be taken by  DISTRIBUTOR
          pursuant to the terms of this  Paragraph 15 shall be paid to PUBLISHER
          [***] days after the Off-Sale Date of such issue.

     (b)  DISTRIBUTOR  shall  account and pay to PUBLISHER for Foreign sales and
Returns  separately  from  non-Foreign  sales and Returns.  All Initial  Advance
Payments for Foreign sales payable pursuant to the terms of subparagraph  (a)(i)
of this Paragraph 15 shall be calculated solely with respect to Foreign sales as
set forth on the  Settlement  Payment  Publisher  Statements of the  Measurement
Issues. Notwithstanding the provisions of subparagraph (a)(ii) of this Paragraph
15, the  Settlement  Payment for  Foreign  sales of an issue shall be made [***]
days after the Off-Sale Date of such issue.

     (c) Each Initial  Advance  Payment and  Settlement  Payment,  and any other
amounts paid by DISTRIBUTOR to PUBLISHER pursuant to the terms of this Agreement
shall be  accompanied by a statement  substantially  in the form of Schedule "G"
attached  hereto  or in  such  other  form as  shall  contain  all the  material
information  set forth on such Schedule "G". Each such  statement is referred to
in this Agreement as a "Publisher Statement."

     (d) In the event that any Settlement Payment Publisher  Statement indicates
an amount due  DISTRIBUTOR  ("Overpayment"),  then  DISTRIBUTOR  may deduct such


                                       34
<PAGE>

overpayment  from any  moneys  then due or  thereafter  due  PUBLISHER  from any
payment with respect to a future  issue of the  Publication  giving rise to such
Overpayment.  Any Returns  received  and/or charges or credits  actually paid by
DISTRIBUTOR pursuant to the terms of this Agreement with respect to any issue of
any  Publication(s)  subsequent to the  preparation  of the  Settlement  Payment
Publisher  Statement and prior to the Outside  Deadline for Returns with respect
to such  issue  and not  previously  taken as a credit by  DISTRIBUTOR  shall be
included  as a  credit  to  DISTRIBUTOR  on any  subsequent  Settlement  Payment
Publisher Statement and deducted from any moneys thereafter payable to PUBLISHER
with respect to such Publication.

     (e)  In  addition  to  the  rights  set  forth  in  subparagraph  (d),  any
Overpayment  arising on or with respect to a Publication and any obligation owed
by PUBLISHER to DISTRIBUTOR  pursuant to the terms of subparagraph 16(e) ("Cross
Obligation")  shall be paid by PUBLISHER to  DISTRIBUTOR  within [***]  business
days  after  DISTRIBUTOR  shall  bill  PUBLISHER  therefor,  and if not so  paid
DISTRIBUTOR may deduct such Overpayment or Cross Obligation from any payment due
PUBLISHER hereunder.

     (f) [***].

     (g) No  advances  or other  payments  shall be  payable by  DISTRIBUTOR  to
PUBLISHER:

          (i)  For  any  issues(s)  for  which  DISTRIBUTOR  has in  good  faith
     exercised its right not to distribute pursuant to Paragraph 19 hereof, or

          (ii)  For  any  issue(s)  of any  Publication  if  PUBLISHER  has  not
     published such issue(s) in accordance with this Agreement, or

                                       35
<PAGE>

          (iii) For the last issue of each  Publication(s)  to be distributed by
     DISTRIBUTOR for PUBLISHER  hereunder except as provided in subparagraph (h)
     of this  Paragraph 15, and provided,  however,  that the provisions of this
     section (iii) shall apply only to the extent reasonably  necessary to repay
     DISTRIBUTOR any amounts owed by PUBLISHER

     (h) The  Settlement  Payment  for  the  last  issue  to be  distributed  by
DISTRIBUTOR  under this Agreement shall be made by DISTRIBUTOR,  to PUBLISHER on
the Outside Deadline for Returns with respect to such issue.

     (i) In any  event,  any  and all  Overpayments  and any  other  amounts  or
obligations  owed by PUBLISHER to DISTRIBUTOR  (including but not limited to any
obligations set forth in subparagraph  16(e)) not theretofore repaid or deducted
by  DISTRIBUTOR  from amounts owed to PUBLISHER  shall be repaid by PUBLISHER to
DISTRIBUTOR [***] business days after demand after termination of this Agreement
or after  [***]  days  after  PUBLISHER  has  ceased  publication  of all of the
Publications.

     (j) The  respective  obligations  of PUBLISHER and  DISTRIBUTOR  under this
Paragraph 15 shall survive the termination of this Agreement.

     (k)  PUBLISHER  shall have the right to challenge any item set forth in any
Publisher  Statement,  provided  that  all  items  which  are  not  specifically
challenged  in  writing  within  [***]  days  of the  date of  delivery  of such
Publisher  Statement shall be deemed binding upon PUBLISHER as an account stated
(except that arithmetic errors need not be challenged until [***] days after the
date of delivery of such Publisher  Statement,  except that reserves for Foreign
Return  Credits  need not be  challenged  until  [***]  days  after  the date of


                                       36
<PAGE>

delivery of such Publisher Statement,  and except that any item which is not set
forth in a manner so as to indicate  the nature and amount of such item need not
be so  challenged  until set forth in such manner in  writing).  For purposes of
this  subparagraph  (k) a  Publisher  Statement  shall be  presumed to have been
delivered  fourteen  (14) days after its due date in the  absence of  compelling
evidence  to the  contrary.  With  respect  to any item which is  challenged  by
PUBLISHER,  the parties shall use their  respective best efforts to identify any
incorrect  or  improper  credits,  charges  or  deductions,  and to  remedy  any
deficiencies resulting therefrom.

     (l)  DISTRIBUTOR  shall remit to PUBLISHER  all GST repayable in accordance
with the terms of Paragraph 7. At  DISTRIBUTOR's  option,  such repayment may be
combined with any other payment  required to be made by DISTRIBUTOR  pursuant to
the terms of this Paragraph 15.

16. INDEMNIFICATION AND GUARANTEE
    -----------------------------

     (a) PUBLISHER  shall  indemnify,  hold harmless and promptly  reimburse the
DISTRIBUTOR,  and  all  of  its  officers,  directors,   employees,  agents  and
representatives  (here  collectively  referred  to as  "Indemnitees"),  from and
against any losses, damages, fines, judgments,  expenditures, claims, reasonable
counsel fees, legal and court expenses,  bond and bail charges and premiums,  as
well as any and all  other  costs  of any  kind or  nature,  resulting  from any
claims,   civil  or  criminal  actions  or  proceedings,   and/or  supplementary
proceedings, or in connection with any inquiries,  proceedings or actions by any
federal,  state,  local and/or any other  governmental  agencies or  authorities
(collectively,  "Claims")  which in anyway relate to, or arise from by or reason
of: (i) the title,  contents or any printed matter  contained  within any of the
Publication(s),  including, but not limited to, editorial contents, photographs,
pictures, cartoons, caricatures, drawings or other artwork, advertisements,  and


                                       37
<PAGE>

classifieds,  whether  contained  on any  cover,  or any  page or  advertisement
contained  in or for  such  Publication(s),  or  any  promotional  material  for
PUBLISHER  or the  Publication(s)  (other than such as may have been  created by
DISTRIBUTOR);   (ii)  the  breach  or  alleged  breach  of  any  of  PUBLISHER's
representations  and warranties  contained in Paragraph 4 of this Agreement,  or
(iii) any act of PUBLISHER  relating to or affecting the distribution or sale of
the  Publication(s)  or the  services  performed  by any of the  Indemnitees  in
connection with any of the Publication(s).

     (b) If any such Claim is brought or made against the aforesaid Indemnitees,
DISTRIBUTOR  shall give PUBLISHER  Notice  thereof as soon as practicable  after
commencement  of  same.   PUBLISHER  shall  undertake  the  defense  thereof  at
PUBLISHER's expense, provided that DISTRIBUTOR has provided the Notice set forth
in the  preceding  sentence.  The failure to give timely Notice shall not affect
DISTRIBUTOR's  rights of indemnification  unless same has materially  prejudiced
the defense of any such Claim.  DISTRIBUTOR  shall have the right to participate
with respect to any such Claim with its own counsel at its own expense,  without
waiver of its rights under this Paragraph 16.

     (c) PUBLISHER  agrees that  PUBLISHER  shall have no right to compromise or
settle any Claim  against  PUBLISHER in which  DISTRIBUTOR  is also named unless
DISTRIBUTOR  receives a release with respect thereto in connection therewith and
unless DISTRIBUTOR receives five (5) days, prior Notice thereof.

     (d)  PUBLISHER  shall  indemnify,  hold  harmless  and  promptly  reimburse
Distributor's  Sales  Outlets  and  their  retail  outlets  (and  all  of  their
respective officers, directors, employees, agents and representatives who shall,


                                       38
<PAGE>

subject to the terms of this subparagraph (d), be deemed to be Indemnitees) from
and against any Claims,  provided  that (i)  DISTRIBUTOR  is or has agreed to be
liable for or to indemnify any such party; (ii) DISTRIBUTOR shall use reasonable
commercial  efforts to cause the  defense of any such  Claim to be  tendered  to
PUBLISHER as soon as practicable after commencement thereof; and (iii) the scope
of the  indemnity  under  this  subparagraph  (d) shall be no  greater  than the
smaller of the indemnity  provided in subparagraph  (a) of this Paragraph 16, or
the scope of the indemnity provided by DISTRIBUTOR to such other party.

     (e) PUBLISHER's obligations hereunder shall survive the termination of this
Agreement.

17. GALLEYS AND SHIPPING INSTRUCTIONS
    ---------------------------------

     DISTRIBUTOR  shall  and  hereby  agrees  to  supply  the  PUBLISHER,  or at
PUBLISHER's  request,  its printer or forwarding agent with one set per issue of
shipment  galleys,   shipping  instructions  and  pre-addressed  mailing  labels
designating  the names and addresses of, and  specifying the number of copies of
each  issue of each  Publication  to be sent  to,  each of  Distributor's  Sales
Outlets,  or computer tapes containing such information  sufficiently in advance
of the  Completion of Shipping with respect to such issue so that such issue can
be shipped to arrive at Distributor's Sales Outlets, receiving point(s) prior to
the On-Sale Date of such issue.

18. ACCESS TO RECORDS
    -----------------

     DISTRIBUTOR  shall give PUBLISHER or its duly  authorized  representatives,
during business hours,  reasonable access to DISTRIBUTOR's draw, sale and Return
figures relating to each issue of the Publication(s) and other necessary records
in support of all items of charges and credits made by  DISTRIBUTOR to PUBLISHER


                                       39
<PAGE>

pursuant  to this  Agreement,  and shall  permit  PUBLISHER  at its own cost and
expense,  to  inspect  and make  copies  of the same and to audit  such  records
relative  to  the  distribution  of any of  the  Publication(s)  subject  to any
limitations  on audit set forth in this  Agreement.  All such  records  shall be
maintained  for a period of twelve (12) months  following  the Off-Sale  Date of
each issue of each Publication.

19. DISTRIBUTOR'S RIGHT TO REFUSE DISTRIBUTION
    ------------------------------------------

     (a)  Anything  to the  contrary  in  this  Agreement  notwithstanding,  the
DISTRIBUTOR  may at any time,  without prior Notice,  and without  incurring any
liability therefor, refuse to distribute any issue of any Publication(s) covered
by this  Agreement,  or at its  option  exercise  the  right to  terminate  this
Agreement,  if such issue, in the reasonable exercise of DISTRIBUTOR's judgment,
contains libelous,  obscene or indecent material,  or invades any person's right
of privacy or other personal  right, or infringes a copyright or trademark owned
by a third  party,  or contains  any matter of any kind that is in  violation of
law, or if such Publication  shall be refused the use of the mails by the United
States  Postal  Service  or such  public  corporation  as may then exist for the
handling of mail,  or if any such issue is refused  entry into the United States
or Canada. In the event DISTRIBUTOR refuses distribution  hereunder with respect
to an issue of a Publication, no payments shall be due PUBLISHER under Paragraph
15 with respect to such issue.  Distribution of any issue of any  Publication(s)
covered by this  Agreement or receipt of  promotional  copies does not and shall
not establish nor  constitute  knowledge or approval by the  DISTRIBUTOR  of the
contents  of such  issue.  The  PUBLISHER  is aware  that  DISTRIBUTOR  does not
regularly  and is not  obligated  to  examine  or pass  upon any  issues  of the
Publication(s).  Nothing  contained in this Paragraph 19 shall affect any rights
of DISTRIBUTOR under Paragraph 16.

                                       40
<PAGE>

     (b)  If   DISTRIBUTOR   exercises  its  right  pursuant  to  the  terms  of
subparagraph  (a) of this  Paragraph  19 to refuse to  distribute  an issue of a
Publication, PUBLISHER shall thereafter for a period of one hundred eighty (180)
days  have  the  right  and  option  to  eliminate  such  Publication  from  the
Publication(s)  covered by this Agreement,  and upon exercise of such option, to
have such  Publication  thereafter  distributed by another  distributor  without
liability to PUBLISHER or DISTRIBUTOR.

20. FORCE MAJEURE
    -------------

     Neither  party  shall be liable  for any  damage  due to causes  beyond its
control,  including  but not limited  to,  acts of civil or military  authority,
orders,  rules or other actions by  appropriate  regulatory  authorities,  labor
difficulties,   fire,   flood,   power  failure,   or  other  natural  or  human
catastrophes, acts of God, national emergencies, quarantine, insurrection, riots
and  failure  of  transportation  and  equipment,  nor shall any of the above be
deemed a default by either party.

21. RELATIONSHIP OF PARTIES
    -----------------------

     It is understood  and agreed that the  relationship  between  PUBLISHER and
DISTRIBUTOR is that of creditor and debtor.  All moneys paid by or due and owing
from  Distributor's  Sales Outlets for copies of Publication(s)  not returned to
DISTRIBUTOR,  are and  shall at all  times  belong to and  remain  the  absolute
property of the  DISTRIBUTOR.  Consequently,  DISTRIBUTOR  shall bear any losses
from  uncollectible  accounts with  Distributor's  Sales outlets,  or with their
retailers  (exclusive  of Returns) and any legal fees or other costs or expenses
incurred for  collection or attempted  collection  therefrom with respect to the
Publication(s).  It is further understood and agreed that DISTRIBUTOR is not the


                                       41
<PAGE>

agent of the PUBLISHER except in connection with any services actually performed
pursuant  to  Paragraph  10 of this  Agreement,  nor is  PUBLISHER  the agent of
DISTRIBUTOR.  Further,  this  Agreement  does not  constitute  and  shall not be
construed as constituting a partnership or joint venture  between  PUBLISHER and
DISTRIBUTOR.  Neither  party  shall have any right to obligate or bind the other
party in any  manner  whatsoever,  except as  otherwise  specifically  set forth
herein,  and nothing  herein  contained  shall give, or is intended to give, any
right of any kind whatsoever to any third persons.

22. ASSIGNMENT, TRANSFERS AND SALE OF RIGHTS, ETC.
    ----------------------------------------------

     (a) Except as otherwise  provided in subparagraph (b) of this Paragraph 22,
PUBLISHER  may not assign this  Agreement  or any rights  hereunder to any other
person,   firm  or  corporation   without  the  prior  written  consent  of  the
DISTRIBUTOR; provided, however,

          (i) Nothing herein  contained shall be construed to prevent  PUBLISHER
     from  assigning  any right to receive  any  advance  or  payment  which the
     DISTRIBUTOR  is required to make to the PUBLISHER  under this  Agreement to
     any single party;

          (ii) Nothing herein contained shall be construed to prevent  PUBLISHER
     from assigning any rights hereunder to any lender as collateral; and

          (iii) Any assignment  made pursuant to this  subparagraph  shall state
     therein  that at all  times  the same is  subject  and  subordinate  in all
     respects to any and all of the rights of DISTRIBUTOR under this Agreement.

     (b) In the event PUBLISHER enters into an agreement to

          (i) sell,  transfer  or  dispose  of all or  substantially  all of the
     assets of PUBLISHER (collectively,  a "Sale"), to another party (other than


                                       42
<PAGE>

     an  Affiliate of PUBLISHER  provided  that such  Affiliate is a party to an
     Affiliate's Distribution Agreement) or

          (ii) sell,  transfer,  assign,  license  or  otherwise  relinquish  or
     dispose of any of its rights to publish any or all of the Publication(s) in
     an English  language  magazine  format  within the Territory and during the
     term  hereof,   or  their  title(s)  or  trademark(s)   covered  under,  or
     distributed pursuant to, this Agreement (collectively, an "Assignment"), to
     another  party (other than an Affiliate  of  PUBLISHER  provided  that such
     Affiliate is a party to an Affiliate's  Distribution  Agreement),  then any
     such agreement shall require that either

          (x) any such other party be bound by and affirmatively  assume all the
     obligations  of  PUBLISHER   hereunder   (including   any   liabilities  to
     DISTRIBUTOR  hereunder)  with  respect to all issues of the  Publication(s)
     subject to such Sale or  Assignment  (as the case may be),  the  respective
     Determination  Date(s)  (as  hereinafter  defined)  of which is (are) on or
     after the date of such Sale or Assignment (as the case may be) and that the
     DISTRIBUTOR  be  named  as a third  party  beneficiary  thereof,  or in the
     alternative,

          (y) such other  party  enter into a new  Distribution  Agreement  with
     DISTRIBUTOR on substantially  the same terms and conditions as contained in
     this  Agreement  for a term  equal  to the  then  remaining  term  of  this
     Agreement.

Upon the satisfaction of one of the foregoing alternatives (x) or (y), PUBLISHER
shall be relieved of any and all liability  under this Agreement with respect to
all issues of Publication(s) subject to such Sale or Assignment,  the respective


                                       43
<PAGE>

Determination  Date(s)  of which is (are) on or after  the date of such  Sale or
Assignment;  provided,  however,  that  PUBLISHER  shall not be  relieved of any
existing or estimated obligation or liability to DISTRIBUTOR,  or any subsequent
obligation  or  liability  if  same  concerns   Publications,   the   respective
Determination  Dates  of  which  are on or  before  the  date  of  such  Sale or
Assignment.  Any such  obligation or liability as to which PUBLISHER has no bona
fide dispute or contest or any  obligation or liability of PUBLISHER as to which
PUBLISHER  has no bona fide  dispute or  contest  arising  subsequent  to such a
transaction shall be paid by PUBLISHER to DISTRIBUTOR  within (10) business days
of receipt by PUBLISHER of a statement therefor, and if not so paid, DISTRIBUTOR
may  deduct  such  sum from  any  amounts  due or  thereafter  due to  PUBLISHER
hereunder,  and if no such amounts are due or thereafter become due, DISTRIBUTOR
may deduct such sum from any amounts due or thereafter due to a publisher  which
at such time is an Affiliate of PUBLISHER not earlier than two (2) business days
after the giving of Notice to such  Affiliate as to  DISTRIBUTOR's  intention to
take such deduction.

     (c) For purposes of this  Paragraph 22 the term  "Determination  Date" with
respect to an issue of a Publication shall mean the On-Sale Date, the Completion
of Shipping,  or the date of the  Settlement  Payment  Publisher  Statement with
respect to such issue, as selected by PUBLISHER in its sole discretion, provided
that such selection is  communicated  promptly to  DISTRIBUTOR,  but in no event
later than twenty (20) days before such Determination Date.

     (d)  PUBLISHER  shall not permit any  Affiliate to obtain any of its Rights
until and unless such Affiliate shall have executed an Affiliate's  Distribution
Agreement with respect to Publications using such Rights.

23. ONE-SHOTS AND/OR ANNUALS
    ------------------------

                                       44
<PAGE>

     Any one-shots and/or annuals derived from any of the  Publication(s) as may
hereafter be published shall be included in this Agreement on the same terms and
conditions as set forth herein.

24. OTHER OBLIGATIONS OF DISTRIBUTOR
    --------------------------------

     (a) DISTRIBUTOR shall not commence  distribution,  other than for PUBLISHER
or an Affiliate of PUBLISHER, of magazines or periodicals principally containing
crossword puzzles, fill-in puzzles,  find-a-word type puzzles, sudoku puzzles or
other  similar type  puzzles,  boxing  magazines,  wrestling  magazines or other
similar type  magazines  which are published on the Effective Date by or for any
of the  publishers  identified  on  Schedule  "B"  attached  hereto or any newly
commenced publications by any such identified publisher; provided, however, that
this subparagraph (a) shall not apply

          (i) at any time when PUBLISHER and all Affiliates of PUBLISHER engaged
     in publication of such type  magazines or  periodicals  shall  collectively
     have a market share of less than fifty  percent  (50%) of their  collective
     market share in 2005, or

          (ii) with  respect to any such  magazines  or  periodicals  which have
     since the Effective Date been sold by the respective  publishers identified
     on Schedule "B" to a publisher not on such  Schedule if such  magazines and
     periodicals sold have a collective market share of two percent (2%) or less
     at the  time  of the  commencement  of  distribution  by  DISTRIBUTOR.

For purposes of this  subparagraph  (a), the collective  market share in 2005 of
PUBLISHER  and  Affiliates  of  PUBLISHER  engaged in  publication  of such type


                                       45
<PAGE>

magazines or  periodicals  shall be  determined  by reference to sale and Return
data  included  in  market  share  analysis  performed  in  conformity  with the
requirements set forth on Schedule "D".

     (b) DISTRIBUTOR  shall, and hereby agrees,  to provide the services and the
reports identified in Schedule "D" attached hereto.

     (c)  DISTRIBUTOR  shall,  and hereby  agrees,  to designate one employee of
DISTRIBUTOR  reasonably  acceptable  to  PUBLISHER  who  shall be the  exclusive
account executive for PUBLISHER during the term hereof; provided,  however, that
such  exclusive  account  executive  may also serve other  publishers  which are
Affiliates of PUBLISHER,  and further provided that in the event that the number
of Publications covered hereby, and by other agreements similar hereto with such
Affiliates becomes too great for any one account  executive,  DISTRIBUTOR may in
its  discretion   designate  another  such  account  executive,   who  shall  be
non-exclusive.

25. NOTICES
    -------

     (a) Except as otherwise specifically provided herein, all Notices permitted
or  required  to be given  hereunder  shall be in writing  and shall be given by
receipted  personal delivery or Federal Express (or similar  overnight  delivery
service),  at the respective addresses set forth below, or at such other address
or addresses as may be designated by either party.  Such Notices shall be deemed
given  when  delivered  to the  respective  address  set forth  below or to such
overnight  delivery service,  except that a Notice of change of address shall be
effective only from the date of its receipt. A copy of each Notice shall be sent
simultaneously to:

         TO DISTRIBUTOR:                               TO PUBLISHER:
c/o Kable News Company, Inc.                           6198 Butler Pike

                                       46
<PAGE>

                                                       Blue Bell, PA  19422

Attention:  President                                  P.O. Box 736
14 Wall Street, Suite 4C                               Fort Washington, PA 19034
New York, NY  10005
                                                       Attention:  Chairman

with a copy to:                                        with a copy to:

Kable News Company, Inc.                               William J. Bonner, Esq.
Attention:  Vice President                             40 Skippack Pike
               of Finance                              P.O. Box 736
                                                       Ft. Washington, PA 19034
Kable Square
Mount Morris, IL 61054

as to Notices pursuant to Paragraph 3 to:

Irving Needleman
AMREP Corporation
300 Alexander Park, Suite 204
Princeton, NJ 08540

and/or to such other  person(s) or addresses as such parties shall  designate to
the other by written Notice.

     (b) Notwithstanding the provisions of subparagraph (a) of this Paragraph 25
to the contrary,  a Printer's  Completion  Notice may be sent to  DISTRIBUTOR by
telecopier  transmission or electronic  transmission  with  confirmation copy by
first class mail or at  PUBLISHER's  option by  overnight  delivery  service and
shall  be  deemed  given  when so  transmitted,  if  subsequently  confirmed  by
telephone with the addressee or by a signed receipt of the addressee.

26. WAREHOUSING
    -----------

     In the event that any  Publication(s)  or other  materials of PUBLISHER are
stored at DISTRIBUTOR's warehouse,  PUBLISHER agrees to pay DISTRIBUTOR its then


                                       47
<PAGE>

current  handling and storage costs as they may be increased  from time to time.
DISTRIBUTOR  reserves  the  right to limit  the  amount  of  space  allotted  to
PUBLISHER.  PUBLISHER agrees to remove any Publication(s) or other material from
DISTRIBUTOR's  premises  upon thirty (30) days' Notice.  In the event  PUBLISHER
does not remove its property within such thirty (30) day period, DISTRIBUTOR may
remove and dispose of same as it sees fit at PUBLISHER's expense.

27. NON-DISCLOSURE
    --------------

     (a) The parties each acknowledge that the terms and conditions contained in
this Agreement constitute confidential business information, and that therefore,
each agree that  they,  their  representatives,  agents and  employees  will not
disclose  the  terms  and   conditions  of  this  Agreement  to  any  person  or
organization  except as otherwise provided in subparagraph (b) of this Paragraph
27.

     (b) Notwithstanding the provisions of subparagraph (a) of this Paragraph 27
to the contrary,

          (i) Either party may disclose the  provisions of this Agreement to any
     potential  purchaser,  assignee,  or licensee of any  Publication  or other
     asset of such party or to underwriters,  accountants,  lawyers,  bankers or
     other lenders,  or such other party or parties as such party may reasonably
     require in the ordinary  course of business;  provided that such  potential
     purchaser, assignee, licensee,  underwriter,  accountant, lawyer, banker or
     other  lender,  or other party agree in writing to hold the  provisions  of
     this Agreement  confidential in the same manner as required by the terms of
     this Paragraph 27;

                                       48
<PAGE>

          (ii) Either  party may disclose the  existence or  provisions  of this
     Agreement if required to do so by any court order or subpoena, or if in the
     reasonable  opinion of its  counsel it is required to do so by any state or
     Federal securities or other law or regulation; and

          (iii) Either party may disclose the  existence or  provisions  of this
     Agreement if any such information has already been publicly disclosed.

28. DISPUTE RESOLUTION FOR CLAIMS.
    ------------------------------

     (a) If PUBLISHER  shall have a claim for  nonpayment of any sums  allegedly
due hereunder against DISTRIBUTOR which DISTRIBUTOR  disputes, or if DISTRIBUTOR
shall have a claim against  PUBLISHER for  nonpayment of any sums  allegedly due
hereunder which PUBLISHER  disputes,  the aggrieved party (the "Claimant") shall
send Notice to the other party of a claim for  nonpayment  (and as to PUBLISHER,
within the time periods permitted by subparagraph 15(j) ("Notice of Dispute'')).

     (b) If the claim for nonpayment is not resolved to the mutual  satisfaction
of both  parties  within  Forty-Five  (45) days  after the  Notice of Dispute is
given, the Claimant may begin binding  arbitration  within twelve (12) months of
the giving of the Notice of Dispute to resolve the claim. The parties agree that
binding arbitration pursuant to the commercial arbitration rules of the American
Arbitration Association under the auspices of its New York City chapter shall be
the exclusive forum for resolving all such claims.

     (c) Arbitration awards may be entered as a judgment in a court of competent
jurisdiction.  Failure to pay an  arbitration  award within fifteen (15) days of
its issuance  shall be grounds for  termination  of this  Agreement by the party
entitled to receive such payment.

                                       49
<PAGE>

     (d) If at any time a Claimant has delivered Notices of Dispute to the other
party with  respect to claims  which  aggregate  One  Hundred  Thousand  Dollars
($100,000) or more, such party must submit all such claims to arbitration within
ninety  (90) days of the  giving of the Notice of  Dispute  with  respect to the
claim which, when aggregated with such other claims,  caused the claims first to
exceed One Hundred Thousand Dollars ($100,000).

     (e)  DISTRIBUTOR  shall retain all its rights to deduct any sums in dispute
from an Initial Advance Payment or a Settlement Payment  notwithstanding receipt
of a Notice of Dispute by  PUBLISHER  demanding  payment of the sum so  deducted
until the claim is resolved or an arbitration  award is entered on such claim in
PUBLISHER's favor.

29. CONSTRUCTION
    ------------

     This  Agreement  shall be governed by and construed in accordance  with the
laws of the  State of New York  applicable  to  agreements  executed  and  fully
performed therein.

30. HEADINGS
    --------

     The headings in this  Agreement are for  convenience  or reference only and
shall not limit or otherwise affect the meaning hereof.

31. GENERAL
    -------

     (a) No waiver of any breach of this Agreement  shall be held to be a waiver
of any other or subsequent  breach.  No waiver,  modification or cancellation of
any term or  condition  of this  Agreement  or any  amendment  thereto  shall be
effective  unless  executed in writing by the party to be charged.  All remedies


                                       50
<PAGE>

afforded by this Agreement (including without limitation, the right to terminate
this  Agreement  where  applicable)  shall be taken and construed as cumulative,
that is, in addition to every other remedy provided herein or by law.

     (b) In the event  that the date on which any  payment  is to be made  under
this Agreement is a Saturday,  Sunday,  or legal  holiday,  the payment shall be
made on the next business day thereafter.

     (c) This  Agreement  shall be  binding  upon the  parties  hereto and their
respective legal representatives, heirs, successors and permitted assigns.

     (d) No oral or other  representations,  understandings  or agreements  have
been made or  relied  upon in the  making of this  Agreement  other  than  those
specifically  set  forth  herein.   This  Agreement,   supersedes  all  existing
agreements by and between the parties hereto and constitutes final expression of
their  agreement with respect to the subject matter hereof and is a complete and
exclusive  statement of the terms thereof.  The express terms hereof shall apply
and supersede any course of performance  between the parties and any practice or
usage of the trade or industry.

     (e) The  Schedules  attached to this  Agreement are  incorporated  into and
hereby made a part hereof.



                         (SIGNATURES ON FOLLOWING PAGE)






                                       51
<PAGE>


     IN WITNESS WHEREOF,  the parties hereto have caused this Agreement executed
by their duly authorized officers, as of the day and year first above written.

KAPPA PUBLISHING GROUP, INC.                  KABLE DISTRIBUTION SERVICES, INC.
       "PUBLISHER"                                     "DISTRIBUTOR"


By: /s/ D. McNulty                            By:  /s/ Michael P. Duloc
   ----------------------------                   ------------------------------

   Despina McNulty,  President                     Michael P. Duloc,  President
   ----------------------------                   ------------------------------
    (Print Name and Title)                          (Print Name and Title)

    1/13/09                                         12/30/08
   ----------------------------                   ------------------------------
           (Date)                                           (Date)


                                       52
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-31
<SEQUENCE>3
<FILENAME>exh31_0309.txt
<TEXT>
                                                                    Exhibit 31.1
                                                                    ------------
CERTIFICATION*
- --------------
I, Peter M. Pizza, certify that:

1.   I have  reviewed  this  Quarterly  Report on Form 10-Q for the period ended
     January 31, 2009 of AMREP Corporation;

2.   Based on my knowledge, this report does not contain any untrue statement of
     a material  fact or omit to state a  material  fact  necessary  to make the
     statements made, in light of the circumstances  under which such statements
     were made,  not  misleading  with  respect  to the  period  covered by this
     report;

3.   Based on my  knowledge,  the  financial  statements,  and  other  financial
     information  included  in  this  report,  fairly  present  in all  material
     respects the financial  condition,  results of operations and cash flows of
     the Registrant as of, and for, the periods presented in this report;

4.   The  Registrant's  other  certifying  officers  and I are  responsible  for
     establishing and maintaining disclosure controls and procedures (as defined
     in Exchange Act Rules  13a-15(e) and 15d-15(e))  and internal  control over
     financial  reporting  (as  defined  in  Exchange  Act Rules  13a-15(f)  and
     15d-15(f)) for the Registrant and have:

     a)   designed  such  disclosure  controls  and  procedures,  or caused such
          disclosure   controls  and   procedures  to  be  designed   under  our
          supervision,  to ensure  that  material  information  relating  to the
          Registrant,  including its consolidated subsidiaries, is made known to
          us by others within those entities,  particularly during the period in
          which this report is being prepared;
     b)   designed such internal  control over  financial  reporting,  or caused
          such internal  control over  financial  reporting to be designed under
          our  supervision,   to  provide  reasonable  assurance  regarding  the
          reliability  of financial  reporting and the  preparation of financial
          statements for external purposes in accordance with generally accepted
          accounting principles;
     c)   evaluated the  effectiveness of the Registrant's  disclosure  controls
          and procedures and presented in this report our conclusions  about the
          effectiveness of the disclosure controls and procedures, as of the end
          of the period covered by this report based on such evaluation; and
     d)   disclosed  in this  report  any  change in the  Registrant's  internal
          control over financial reporting that occurred during the Registrant's
          most recent fiscal quarter (the Registrant's  fourth fiscal quarter in
          the case of an annual  report)  that has  materially  affected,  or is
          reasonably  likely to materially  affect,  the  Registrant's  internal
          control over financial reporting; and

5.   The Registrant's other certifying  officers and I have disclosed,  based on
     our most recent evaluation of internal control over financial reporting, to
     the Registrant's auditors and the audit committee of the Registrant's board
     of directors (or persons performing the equivalent functions):

     a)   all significant  deficiencies and material weaknesses in the design or
          operation  of internal  control  over  financial  reporting  which are
          reasonably  likely to  adversely  affect the  Registrant's  ability to
          record, process, summarize and report financial information; and
     b)   any fraud, whether or not material,  that involves management or other
          employees who have a  significant  role in the  Registrant's  internal
          control over financial reporting.

Dated:   March 12, 2009

/s/ Peter M. Pizza
- ------------------------------------------
Peter M. Pizza
Vice President and Chief Financial Officer

- ----------------------
*The Registrant is a holding company that does substantially all of its business
through two indirect wholly-owned  subsidiaries (and their subsidiaries).  Those
indirect  wholly-owned  subsidiaries  are AMREP Southwest Inc. ("ASW") and Kable
Media Services, Inc. ("Kable"). James Wall is the principal executive officer of
ASW,  and  Michael P. Duloc is the  principal  executive  officer of Kable.  The
Registrant has no chief executive officer.  Its executive officers include James
Wall,  Senior  Vice  President  and Peter M.  Pizza,  Vice  President  and Chief
Financial Officer,  and Michael P. Duloc, who may be deemed an executive officer
by reason of his position with Kable.



<PAGE>


                                                                    Exhibit 31.2
                                                                    ------------
CERTIFICATION*
- --------------
I, James Wall, certify that:

1.   I have  reviewed  this  Quarterly  Report on Form 10-Q for the period ended
     January 31, 2009 of AMREP Corporation;

2.   Based on my knowledge, this report does not contain any untrue statement of
     a material  fact or omit to state a  material  fact  necessary  to make the
     statements made, in light of the circumstances  under which such statements
     were made,  not  misleading  with  respect  to the  period  covered by this
     report;

3.   Based on my  knowledge,  the  financial  statements,  and  other  financial
     information  included  in  this  report,  fairly  present  in all  material
     respects the financial  condition,  results of operations and cash flows of
     the Registrant as of, and for, the periods presented in this report;

4.   The  Registrant's  other  certifying  officers  and I are  responsible  for
     establishing and maintaining disclosure controls and procedures (as defined
     in Exchange Act Rules  13a-15(e) and 15d-15(e))  and internal  control over
     financial  reporting  (as  defined  in  Exchange  Act Rules  13a-15(f)  and
     15d-15(f)) for the Registrant and have:

     a)   designed  such  disclosure  controls  and  procedures,  or caused such
          disclosure   controls  and   procedures  to  be  designed   under  our
          supervision,  to ensure  that  material  information  relating  to the
          Registrant,  including its consolidated subsidiaries, is made known to
          us by others within those entities,  particularly during the period in
          which this report is being prepared;
     b)   designed such internal  control over  financial  reporting,  or caused
          such internal  control over  financial  reporting to be designed under
          our  supervision,   to  provide  reasonable  assurance  regarding  the
          reliability  of financial  reporting and the  preparation of financial
          statements for external purposes in accordance with generally accepted
          accounting principles;
     c)   evaluated the  effectiveness of the Registrant's  disclosure  controls
          and procedures and presented in this report our conclusions  about the
          effectiveness of the disclosure controls and procedures, as of the end
          of the period covered by this report based on such evaluation; and
     d)   disclosed  in this  report  any  change in the  Registrant's  internal
          control over financial reporting that occurred during the Registrant's
          most recent fiscal quarter (the Registrant's  fourth fiscal quarter in
          the case of an annual  report)  that has  materially  affected,  or is
          reasonably  likely to materially  affect,  the  Registrant's  internal
          control over financial reporting; and

5.   The Registrant's other certifying  officers and I have disclosed,  based on
     our most recent evaluation of internal control over financial reporting, to
     the Registrant's auditors and the audit committee of the Registrant's board
     of directors (or persons performing the equivalent functions):

     a)   all significant  deficiencies and material weaknesses in the design or
          operation  of internal  control  over  financial  reporting  which are
          reasonably  likely to  adversely  affect the  Registrant's  ability to
          record, process, summarize and report financial information; and
     b)   any fraud, whether or not material,  that involves management or other
          employees who have a  significant  role in the  Registrant's  internal
          control over financial reporting.

Dated:   March 12, 2009

/s/ James Wall
- --------------
James Wall
Principal Executive Officer of ASW

- ----------------------
*The Registrant is a holding company that does substantially all of its business
through two indirect wholly-owned  subsidiaries (and their subsidiaries).  Those
indirect  wholly-owned  subsidiaries  are AMREP Southwest Inc. ("ASW") and Kable
Media Services, Inc. ("Kable"). James Wall is the principal executive officer of
ASW,  and  Michael P. Duloc is the  principal  executive  officer of Kable.  The
Registrant has no chief executive officer.  Its executive officers include James
Wall,  Senior  Vice  President  and Peter M.  Pizza,  Vice  President  and Chief
Financial Officer,  and Michael P. Duloc, who may be deemed an executive officer
by reason of his position with Kable.


<PAGE>



                                                                    Exhibit 31.3
                                                                    ------------
CERTIFICATION*
- --------------
I, Michael P. Duloc, certify that:

1.   I have  reviewed  this  Quarterly  Report on Form 10-Q for the period ended
     January 31, 2009 of AMREP Corporation;

2.   Based on my knowledge, this report does not contain any untrue statement of
     a material  fact or omit to state a  material  fact  necessary  to make the
     statements made, in light of the circumstances  under which such statements
     were made,  not  misleading  with  respect  to the  period  covered by this
     report;

3.   Based on my  knowledge,  the  financial  statements,  and  other  financial
     information  included  in  this  report,  fairly  present  in all  material
     respects the financial  condition,  results of operations and cash flows of
     the Registrant as of, and for, the periods presented in this report;

4.   The  Registrant's  other  certifying  officers  and I are  responsible  for
     establishing and maintaining disclosure controls and procedures (as defined
     in Exchange Act Rules  13a-15(e) and 15d-15(e))  and internal  control over
     financial  reporting  (as  defined  in  Exchange  Act Rules  13a-15(f)  and
     15d-15(f)) for the Registrant and have:

     a)   designed  such  disclosure  controls  and  procedures,  or caused such
          disclosure   controls  and   procedures  to  be  designed   under  our
          supervision,  to ensure  that  material  information  relating  to the
          Registrant,  including its consolidated subsidiaries, is made known to
          us by others within those entities,  particularly during the period in
          which this report is being prepared;
     b)   designed such internal  control over  financial  reporting,  or caused
          such internal  control over  financial  reporting to be designed under
          our  supervision,   to  provide  reasonable  assurance  regarding  the
          reliability  of financial  reporting and the  preparation of financial
          statements for external purposes in accordance with generally accepted
          accounting principles;
     c)   evaluated the  effectiveness of the Registrant's  disclosure  controls
          and procedures and presented in this report our conclusions  about the
          effectiveness of the disclosure controls and procedures, as of the end
          of the period covered by this report based on such evaluation; and
     d)   disclosed  in this  report  any  change in the  Registrant's  internal
          control over financial reporting that occurred during the Registrant's
          most recent fiscal quarter (the Registrant's  fourth fiscal quarter in
          the case of an annual  report)  that has  materially  affected,  or is
          reasonably  likely to materially  affect,  the  Registrant's  internal
          control over financial reporting; and

5.   The Registrant's other certifying  officers and I have disclosed,  based on
     our most recent evaluation of internal control over financial reporting, to
     the Registrant's auditors and the audit committee of the Registrant's board
     of directors (or persons performing the equivalent functions):

     a)   all significant  deficiencies and material weaknesses in the design or
          operation  of internal  control  over  financial  reporting  which are
          reasonably  likely to  adversely  affect the  Registrant's  ability to
          record, process, summarize and report financial information; and
     b)   any fraud, whether or not material,  that involves management or other
          employees who have a  significant  role in the  Registrant's  internal
          control over financial reporting.

Dated:   March 12, 2009

/s/ Michael P. Duloc
- --------------------
Michael P. Duloc
Principal Executive Officer of Kable

- ----------------------
*The Registrant is a holding company that does substantially all of its business
through two indirect wholly-owned  subsidiaries (and their subsidiaries).  Those
indirect  wholly-owned  subsidiaries  are AMREP Southwest Inc. ("ASW") and Kable
Media Services, Inc. ("Kable"). James Wall is the principal executive officer of
ASW,  and  Michael P. Duloc is the  principal  executive  officer of Kable.  The
Registrant has no chief executive officer.  Its executive officers include James
Wall,  Senior  Vice  President  and Peter M.  Pizza,  Vice  President  and Chief
Financial Officer,  and Michael P. Duloc, who may be deemed an executive officer
by reason of his position with Kable.

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-32
<SEQUENCE>4
<FILENAME>exh32_0309.txt
<TEXT>


                                                                      EXHIBIT 32
                                                                      ----------


                            CERTIFICATION PURSUANT TO
                             18 U.S.C. SECTION 1350
                             AS ADOPTED PURSUANT TO
                  SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of AMREP  Corporation (the "Company") on
Form 10-Q for the period ended January 31, 2009 as filed with the Securities and
Exchange  Commission on the date hereof (the "Report"),  each of the undersigned
does hereby certify,  pursuant to 18 U.S.C. Section 1350, as adopted pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002, that to his knowledge:

     (1)  The Report fully  complies with the  requirements  of section 13(a) or
          15(d) of the Securities Exchange Act of 1934; and

     (2)  The  information  contained  in the  Report  fairly  presents,  in all
          material respects,  the financial  condition and results of operations
          of the Company.

Dated:  March 12, 2009

  /s/ Peter M. Pizza
- --------------------------
Peter M. Pizza*
Vice President and
Chief Financial Officer

  /s/ James Wall
- --------------------------
James Wall*

  /s/ Michael P. Duloc
- --------------------------
Michael P. Duloc*



- --------------
*The  Registrant  is a  holding  company  which  does  substantially  all of its
business   through   two   indirect   wholly-owned   subsidiaries   (and   their
subsidiaries). Those indirect wholly-owned subsidiaries are AMREP Southwest Inc.
("ASW") and Kable Media Services,  Inc.  ("Kable").  James Wall is the principal
executive  officer  of ASW,  and  Michael P.  Duloc is the  principal  executive
officer of Kable. The Registrant has no chief executive  officer.  Its executive
officers  include James Wall,  Senior Vice  President  and Peter M. Pizza,  Vice
President and Chief Financial  Officer,  and Michael P. Duloc, who may be deemed
an executive officer by reason of his position with Kable.
</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
-----END PRIVACY-ENHANCED MESSAGE-----
