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<SEC-DOCUMENT>0001089355-05-000047.txt : 20050331
<SEC-HEADER>0001089355-05-000047.hdr.sgml : 20050331
<ACCEPTANCE-DATETIME>20050331172834
ACCESSION NUMBER:		0001089355-05-000047
CONFORMED SUBMISSION TYPE:	10-K
PUBLIC DOCUMENT COUNT:		5
CONFORMED PERIOD OF REPORT:	20041231
FILED AS OF DATE:		20050331
DATE AS OF CHANGE:		20050331

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			SIEBERT FINANCIAL CORP
		CENTRAL INDEX KEY:			0000065596
		STANDARD INDUSTRIAL CLASSIFICATION:	SECURITY BROKERS, DEALERS & FLOTATION COMPANIES [6211]
		IRS NUMBER:				111796714
		STATE OF INCORPORATION:			NY
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		10-K
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	000-05703
		FILM NUMBER:		05722075

	BUSINESS ADDRESS:	
		STREET 1:		885 THIRD AVENUE
		STREET 2:		SUITE 1720
		CITY:			NEW YORK
		STATE:			NY
		ZIP:			10022
		BUSINESS PHONE:		2126442400

	MAIL ADDRESS:	
		STREET 1:		885 THIRD AVENUE
		STREET 2:		SUITE 1720
		CITY:			NEW YORK
		STATE:			NY
		ZIP:			10022

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	MICHAELS J INC
		DATE OF NAME CHANGE:	19950221
</SEC-HEADER>
<DOCUMENT>
<TYPE>10-K
<SEQUENCE>1
<FILENAME>siebert_financialcorp.htm
<DESCRIPTION>FORM 10-K
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<P align=center><FONT face="Times New Roman, Times, Serif" size=2><B><FONT size=4>UNITED STATES<BR>SECURITIES AND EXCHANGE COMMISSION</FONT><BR></B></FONT><FONT face="Times New Roman, Times, Serif" size=2><B>Washington, D.C. 20549</B></FONT></P>
<P align=center><FONT face="Times New Roman, Times, Serif" size=4><B>FORM 10-K</B></FONT></P>
<P align=center><FONT face="Times New Roman, Times, Serif" size=2>(Mark One)</FONT></P>
<P align=center><FONT face="Times New Roman, Times, Serif" size=2><FONT face=Wingdings size=3>x</FONT><B> ANNUAL REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES<BR>EXCHANGE ACT OF 1934</B></FONT></P>
<P align=center><FONT face="Times New Roman, Times, Serif" size=2>For the fiscal year ended DECEMBER 31, 2004</FONT></P>
<P align=center><FONT face="Times New Roman, Times, Serif" size=2><FONT face=Wingdings size=3>o</FONT> <B>TRANSITION REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES<BR>EXCHANGE ACT OF 1934</B></FONT></P>
<P align=center><FONT face="Times New Roman, Times, Serif" size=2>For the transition period from&nbsp;&nbsp;&nbsp;_____________to __________</FONT></P>
<P align=center><FONT face="Times New Roman, Times, Serif" size=2>Commission file number&nbsp;&nbsp;&nbsp; 0-5703</FONT></P>
<P align=center><FONT face="Times New Roman, Times, Serif" size=2><B><FONT size=5>SIEBERT FINANCIAL CORP.</FONT><BR></B>(Exact name of registrant as specified in its charter)</FONT></P>
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<TR align="CENTER">
<TD width="50%"><FONT face="Times New Roman, Times, Serif" size=2><B>NEW YORK&nbsp;</B></FONT></TD>
<TD width="50%"><FONT face="Times New Roman, Times, Serif" size=2><B>11-1796714</B></FONT></TD></TR>
<TR align="CENTER">
<TD><FONT face="Times New Roman, Times, Serif" size=2>(State or other jurisdiction of</FONT></TD>
<TD><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;(I.R.S. Employer</FONT></TD></TR>
<TR align="CENTER">
<TD><FONT face="Times New Roman, Times, Serif" size=2>incorporation or organization)</FONT></TD>
<TD><FONT face="Times New Roman, Times, Serif" size=2>Identification No.)</FONT></TD></TR>
<TR align="CENTER">
<TD>&nbsp;</TD>
<TD>&nbsp;</TD></TR>
<TR align="CENTER">
<TD><FONT face="Times New Roman, Times, Serif" size=2><B>885 THIRD AVENUE, NEW YORK, NEW YORK</B></FONT></TD>
<TD><FONT face="Times New Roman, Times, Serif" size=2><B>10022</B></FONT></TD></TR>
<TR align="CENTER">
<TD><FONT face="Times New Roman, Times, Serif" size=2>(Address of principal executive offices)</FONT></TD>
<TD><FONT face="Times New Roman, Times, Serif" size=2>(Zip Code)</FONT></TD></TR>
<TR align="CENTER">
<TD>&nbsp;</TD>
<TD>&nbsp;</TD></TR>
<TR align="CENTER">
<TD><FONT face="Times New Roman, Times, Serif" size=2>Registrant&#146;s telephone number</FONT></TD>
<TD><FONT face="Times New Roman, Times, Serif" size=2>(212) 644-2400</FONT></TD></TR>
<TR align="CENTER">
<TD>&nbsp;</TD>
<TD>&nbsp;</TD></TR>
<TR align="CENTER">
<TD colSpan=2><FONT face="Times New Roman, Times, Serif" size=2>Securities registered under Section 12(b) of the Exchange Act:</FONT></TD></TR>
<TR align="CENTER">
<TD>&nbsp;</TD>
<TD>&nbsp;</TD></TR>
<TR align="CENTER">
<TD><FONT face="Times New Roman, Times, Serif" size=2>Title of each class</FONT></TD>
<TD><FONT face="Times New Roman, Times, Serif" size=2>Name of each exchange on which registered</FONT></TD></TR>
<TR align="CENTER">
<TD>&nbsp;</TD>
<TD>&nbsp;</TD></TR>
<TR align="CENTER">
<TD><FONT face="Times New Roman, Times, Serif" size=2><B>NONE</B></FONT></TD>
<TD><FONT face="Times New Roman, Times, Serif" size=2><B>NONE</B></FONT></TD></TR></TABLE>
<P align=center><FONT face="Times New Roman, Times, Serif" size=2>Securities registered under Section 12(g) of the Exchange Act:</FONT></P>
<P align=center><FONT face="Times New Roman, Times, Serif" size=2><B>COMMON STOCK, PAR VALUE $.01 PER SHARE</B></FONT></P>
<P align=center><FONT face="Times New Roman, Times, Serif" size=2>(Title of class)</FONT></P>
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<TR>
<TD vAlign=top><FONT face="Times New Roman, Times, Serif" size=2>Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act of 1934 during the preceding 12 months (or for such shorter period
that the registrant was required to file such reports), and (2) has been subject to such filing requirements
for the past 90 days. </FONT></TD></TR>
<TR>
<TD vAlign=top>&nbsp;</TD></TR>
<TR>
<TD vAlign=top><FONT face="Times New Roman, Times, Serif" size=2>Yes&nbsp;&nbsp;&nbsp; <FONT face=Wingdings size=3>x</FONT>&nbsp;&nbsp;&nbsp; No <FONT face=Wingdings size=3>o</FONT></FONT></TD></TR>
<TR>
<TD vAlign=top>&nbsp;</TD></TR>
<TR>
<TD vAlign=top><FONT face="Times New Roman, Times, Serif" size=2>Indicate by check mark if disclosure of delinquent filers in response to Item 405 of Regulation S-K
(ss. 229.405) is not contained herein, and will not be contained, to the best of registrant&#146;s
knowledge, in definitive proxy or information statements incorporated by reference in Part III of
this Form 10-K or any amendment to this Form 10-K. <FONT face=Wingdings size=3>x</FONT></FONT></TD></TR>
<TR>
<TD vAlign=top>&nbsp;</TD></TR>
<TR>
<TD vAlign=top><FONT face="Times New Roman, Times, Serif" size=2>Indicate by check mark whether the registrant is an accelerated filer (as defined in Exchange Act Rule
12b-2). Yes <FONT face=Wingdings size=3>o</FONT> No <FONT face=Wingdings size=3>x</FONT></FONT></TD></TR></TABLE><BR>
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<TD>
<HR style="MARGIN-TOP: -2px" noShade SIZE=1>

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<P style="PAGE-BREAK-BEFORE: always">
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>The number of shares of the Registrant&#146;s outstanding Common Stock, as of March 9, 2005, was 22,084,587
shares. The aggregate market value of the Common Stock held by non-affiliates of the registrant (based
upon the last sale price of the Common Stock reported on the Nasdaq Stock Market as of the last business
day of the registrant&#146;s most recently completed second fiscal quarter (June 30, 2004), was $7,362,139.
</FONT></P>
<TABLE cellSpacing="0" cellPadding="0" width="100%" border="0">

<TR>
<TD vAlign=top><FONT face="Times New Roman, Times, Serif" size=2>Documents Incorporated by Reference: Proxy Statement to be filed pursuant to Regulation 14A of the
Exchange Act on or before April 30, 2005, incorporated by reference into Part III. </FONT></TD></TR>
<TR>
<TD vAlign=top>&nbsp;</TD></TR>
<TR>
<TD vAlign=top><FONT face="Times New Roman, Times, Serif" size=2><B>SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS </B></FONT></TD></TR>
<TR>
<TD vAlign=top>&nbsp;</TD></TR>
<TR>
<TD vAlign=top><FONT face="Times New Roman, Times, Serif" size=2>Statements in this Annual Report on Form 10-K, as well as oral statements that may be made by the Company
or by officers, directors or employees of the Company acting on the Company&#146;s behalf, that are
not statements of historical or current fact constitute &#147;forward looking statements&#148; within
the meaning of the Private Securities Litigation Reform Act of 1995. Such forward looking statements
involve risks and uncertainties and known and unknown factors that could cause the actual results
of the Company to be materially different from historical results or from any future expressed or
implied by such forward looking statements, including without limitation: changes in general economic
and market conditions; changes and prospects for changes in interest rates; fluctuations in volume
and prices of securities; demand for brokerage and investment banking services; competition within
and without the discount brokerage business, including the offer of broader services; competition
from electronic discount brokerage firms offering greater discounts on commissions than the Company;
the prevalence of a flat fee environment; decline in participation in equity or municipal finance
underwritings; limited trading opportunities; the method of placing trades by the Company&#146;s
customers; computer and telephone system failures; the level of spending by the Company on advertising
and promotion; trading errors and the possibility of losses from customer non-payment of amounts
due; other increases in expenses and changes in net capital or other regulatory requirements. </FONT></TD></TR></TABLE>
<P align=center><FONT face="Times New Roman, Times, serif" size=2>- 2 -</FONT></P>
<HR noShade SIZE=5>

<P style="PAGE-BREAK-BEFORE: always">
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>PART I </B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>ITEM 1. BUSINESS </B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>GENERAL </B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Siebert Financial Corp. (the &#147;Company&#148;) is a holding company that conducts its retail discount
brokerage and investment banking business through its wholly-owned subsidiary, Muriel Siebert &amp;
Co., Inc., a Delaware corporation (&#147;Siebert&#148;). Muriel Siebert, the first woman member of
the New York Stock Exchange, is the Chairwoman and President and owns approximately 90% of the outstanding
common stock, par value $.01 per share (the &#147;Common Stock&#148;) of the Company. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>The Company&#146;s principal offices are located at 885 Third Avenue, New York, New York 10022, and
its phone number is (212) 644-2400. The Company&#146;s Internet address is www.siebertnet.com. The
Company&#146;s SEC filings are available through its website, where you are able to obtain copies
of the Company&#146;s public filings free of charge. The Company&#146;s Common Stock trades on the
Nasdaq National Market under the symbol &#147;SIEB&#148;. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>BUSINESS OVERVIEW </B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif"><FONT face="Times New Roman, Times, Serif" size=2>Siebert&#146;s principal activity is providing Internet and traditional discount brokerage and related
services to retail investors and, through its wholly owned subsidiary, Siebert Woman&#146;s Financial
Network, Inc (&#147;WFN&#148;), engages in providing products, services and information all uniquely
devoted to woman&#146;s financial needs</FONT><FONT size=2>. Through its Capital Markets division, Siebert also offers institutional clients equity execution
services on an agency basis, as well as equity and fixed income underwriting and investment banking
services. The Company believes that it is the largest Woman-Owned Business Enterprise (&#147;WBE&#148;)
in the capital markets business in the country. In addition, Siebert, Brandford, Shank &amp; Co.,
LLC (&#147;SBS&#148;), a company in which Siebert holds a 49% ownership interest, is the largest
Minority and Women&#146;s Business Enterprise (&#147;MWBE&#148;) in the tax-exempt underwriting business
in the country. </FONT></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>THE RETAIL DIVISION </B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>DISCOUNT BROKERAGE AND RELATED SERVICES. Siebert became a discount broker on May 1, 1975, a date that
would later come to be known as &#147;May Day.&#148; Siebert believes that it has been in business
and a member of The New York Stock Exchange, Inc. (the &#147;NYSE&#148;) longer than any other discount
broker. In 1998, Siebert began to offer its customers access to their accounts through SiebertNet,
its Internet website. Siebert&#146;s focus in its discount brokerage business is to serve retail
clients seeking a wide selection of quality investment services, including trading through a broker
on the telephone, through a wireless device or via the Internet, at commissions that are substantially
lower than those of full-commission firms and competitive with the national discount brokerage firms.
Siebert clears its securities transactions on a fully disclosed basis through National Financial
Services Corp. (&#147;NFS&#148;), a wholly owned subsidiary of Fidelity Investments. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Siebert serves investors who make their own investment decisions. Siebert seeks to assist its customers
in their investment decisions by offering a number of value added services, including easy access
to account information. Siebert&#146;s representatives are available to assist customers with information
via toll-free 800 service Monday through Friday between 7:30 a.m. and 7:30 p.m. Eastern Time. Through
its SiebertNet, Mobile Broker, inter-active voice recognition and Siebert MarketPhone services, 24-hour
access is available to customers. </FONT></P>
<P align=center><FONT face="Times New Roman, Times, serif" size=2>- 3 -</FONT></P>
<HR noShade SIZE=5>

<P style="PAGE-BREAK-BEFORE: always">
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>INDEPENDENT RETAIL EXECUTION SERVICES. Siebert offers what it believes to be the best possible trade
executions for customers. Siebert does not make markets in securities, nor does it take positions
against customer orders. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Siebert&#146;s listed orders are routed in a manner intended to afford its customers the opportunity
for price improvement on all orders. Through a service called NYSE Prime&#153;, Siebert also has
the ability to document to customers all price improvements received on orders executed on the NYSE
when orders are filled at better than the National Best Bid/Offer. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Siebert&#146;s over the counter orders are executed through a network of Nasdaq market makers with
no single market maker executing all trades.&nbsp;The firm also offers customers execution services
through Nasdaq&#146;s SelectNet&#153; and Reuters&#146; Instinet&#153; systems for an additional
fee. These systems give customers access to all Electronic Communication Networks listed on SelectNet&#153;
and to Instinet&#153; before and after regular market hours. Siebert believes that its over-the counter
executions afford its customers the best possible opportunity for consistent price improvement. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Customers may also indicate online interest in buying or selling fixed income securities, including
municipal bonds, corporate bonds, mortgage-backed securities, Government Sponsored Enterprises, Unit
Investment Trusts or Certificates of Deposit. These transactions are serviced by registered representatives.
</FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>RETAIL CUSTOMER SERVICE. Siebert believes that superior customer service enhances its ability to compete
with larger discount brokerage firms and therefore provides retail customers, at no additional charge,
with personal service via toll-free access to dedicated customer support personnel for all of its
products and services. Customer service personnel are located in each of Siebert&#146;s branch offices.
Siebert presently has retail offices in New York, New York, Jersey City, New Jersey, Boca Raton,
Surfside, Palm Beach and Naples, Florida and Beverly Hills, California. Siebert uses a proprietary
Customer Relationship Management System that enables representatives, no matter where located, to
view a customer&#146;s service requests and the response thereto. Eventually, it is intended that
this system will also allow customers to enter their requests directly into the system and track
the response. Siebert&#146;s telephone system permits the automatic routing of calls to the next
available agent having the appropriate skill set. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>RETIREMENT ACCOUNTS. Siebert offers customers a variety of self-directed retirement accounts for which
it acts as agent on all transactions. Custodial services are provided through an affiliate of NFS,
the firm&#146;s clearing agent, which also serves as trustee for such accounts. Each IRA, SEP IRA,
ROTH IRA, 401(k) and KEOGH account can be invested in mutual funds, stocks, bonds and other investments
in a consolidated account. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>CUSTOMER FINANCING. Customers margin accounts are carried through Siebert&#146;s clearing agent,&nbsp;lends
customers a portion of the market value of certain securities held in the customer&#146;s account.
Margin loans are collateralized by these securities. Customers also may sell securities short in
a margin account, subject to minimum equity and applicable margin requirements, and the availability
of such securities to be borrowed. In permitting customers to engage in margin, short sale or any
transaction, Siebert assumes the risk of its customers&#146; failure to meet their obligations in
the event of adverse changes in the market value of the securities positions. Both Siebert and its
clearing agents reserve the right to set margin requirements higher than those established by the
Federal Reserve Board. </FONT></P>
<P align=center><FONT face="Times New Roman, Times, serif" size=2>- 4 -</FONT></P>
<HR noShade SIZE=5>

<P style="PAGE-BREAK-BEFORE: always">
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Siebert has established policies with respect to maximum purchase commitments for new customers or
customers with inadequate collateral to support a requested purchase. Managers have some flexibility
in the allowance of certain transactions. When transactions occur outside normal guidelines, accounts
are monitored closely until their payment obligation is completed; if the customer does not meet
the commitment, steps are taken to close out the position and minimize any loss. Siebert has not
had significant credit losses in the last five years. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>INFORMATION AND COMMUNICATIONS SYSTEMS. Siebert&#146;s operations rely heavily on information processing
and communications systems which are provided by Siebert&#146;s clearing agent. The system for processing
securities transactions is highly automated. Registered representatives utilize personal computer
workstations to access customer account information, obtain securities prices and related information
and enter and confirm orders through dedicated lines to Siebert&#146;s clearing agents. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Siebert maintains a computer network to support its customer service messaging systems, as well as
other applications such as record keeping and direct customer access to marketing information. Through
its clearing agents, Siebert&#146;s computers are linked to the major registered United States securities
exchanges, the National Securities Clearing Corporation and The Depository Trust Company. Failure
of Siebert&#146;s redundant private lines local area networks or communication systems for a significant
period of time could limit the ability to process a large volume of transactions accurately and rapidly.
This could result in Siebert being unable to satisfy its obligations to customers and other securities
firms, and in such an event could result in regulatory violations. External events, such as an earthquake
or massive power failure, loss of redundant external information feeds, such as security price information,
as well as massive internal malfunctions, could render part or all of such systems inoperative. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>To enhance the reliability of its systems and backup data, Siebert maintains redundancies, backup plans
and recovery functions including backup trading facilities. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Siebert&#146;s communications systems include a voice system that allows calls to be answered by the
next available agent having the appropriate skill set for the incoming call. Data is delivered to
branches over a frame relay system and is backed up by an ISDN network. Call center software provides
statistical reports, such as time on hold, duration of calls and the number of calls handled by each
agent. The vendor of the communications system monitors these systems on a twenty-four hour a day,
seven day a week basis and can make software repairs remotely. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>CURRENT DEVELOPMENTS </B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>In February 2004, Siebert agreed to acquire certain retail discount brokerage accounts from Wall Street
Discount Corp. These accounts were transferred to Siebert in April 2004.</FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>In June 2004, Siebert expanded its Capital Markets Group (&#147;SCM&#148;) and New York Stock Exchange
(&#147;NYSE&#148;) Floor Operations. SCM provides high-quality brokerage service to both institutional
investors and issuers of equity and fixed-income securities. The NYSE Floor Operation provides institutional
investors with direct access to Siebert&#146;s trading professionals in the NYSE floor.</FONT></P>
<P align=center><FONT face="Times New Roman, Times, serif" size=2>- 5 -</FONT></P>
<HR noShade SIZE=5>

<P style="PAGE-BREAK-BEFORE: always">
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Siebert filed a lawsuit against Intuit, Inc. (&#147;Intuit&#148;), in New York State Supreme Court


on September 17, 2003 (the &#147;Intuit Lawsuit&#148;), seeking not less than $11.1 million in

compensatory
damages and $33.3 million in punitive damages for claims relating to the Joint Brokerage

Service
(the &#147;JBS&#148;) conducted during the years ended December 31, 2003 and 2002 under

the Strategic
Alliance Agreement between Siebert and Intuit. A motion by Intuit to stay the lawsuit

and require
that the dispute be submitted to arbitration was denied in a decision of the Supreme

Court dated
January 7, 2004. Intuit&#146;s motion to reargue the Court&#146;s decision was denied

by the Court
in a decision dated June 7, 2004. Intuit appealed both decisions to the Appellate

Division of the
Supreme Court. By a unanimous decision and order dated October 28, 2004, the
Appellate
Division affirmed
the lower Court&#146;s January 7, 2004 decision, denying Intuit&#146;s
motion
to compel arbitration
and stay litigation. By further order of the Appellate Division
dated January
4, 2005, Intuit&#146;s
motion for reargument or for leave to appeal to the Court
of Appeals was
denied. On February 7, 2005,
Intuit made a motion directly to the Court of Appeals
for leave to
appeal to that Court from the
Appellate Division&#146;s order of October 28, 2004.
Intuit&#146;s
motion and Siebert&#146;s answering
papers were submitted to the Court of Appeals
for decision
on February 22, 2005. By a decision announced
on March 29, 2005, the court of Appeals
denied Intuit&#146;s
motion for leave to appeal, thereby
ending any controversy over Siebert&#146;s
right to litigate
in court rather than arbitrate. </FONT><FONT face="Times New Roman, Times, Serif" size=2>In addition, Intuit has also moved in the Supreme Court, on February 4, 2005, to dismiss five of the


six causes of action asserted by Siebert in the Intuit Lawsuit. </FONT><FONT face="Times New Roman, Times, Serif" size=2>Siebert&#146;s answering papers and Intuit&#146;s reply papers on that motion are scheduled to be submitted


to the Supreme Court on April 11, 2005. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>As previously disclosed, Siebert terminated the fully disclosed clearing agreement (the &#147;Clearing
Agreement&#148;) with Pershing LLC (formerly the Pershing division of Donaldson, Lufkin &amp; Jenrette
Securities Corporation) (&#147;Pershing&#148;). Based on consultation with counsel, Siebert believes
that the $1,500,000 that it advanced to Pershing in January 2003 should be returned and that Pershing
may be liable for damages. Pershing has expressed its belief that it is entitled to retain the advance
and receive a minimum of $3 million for its unreimbursed costs, a termination fee of $500,000 and
$5 million for lost revenues. Siebert believes the Pershing claims are without merit and that the
ultimate result of this matter will not have a material adverse effect on result of operations or
financial positions. Siebert has decided not to commence proceedings against Pershing at the present
time. As a result, Siebert has charged the $1,500,000 advance to Pershing against income in the fourth
quarter of 2004 since recent communication indicated that Pershing and the Company cannot resolve this matter. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>On May 15, 2000, the board of directors of the Company authorized the repurchase of up to 1,000,000
shares of the Company&#146;s common stock. Shares will be purchased from time to time, in the discretion
of the Company, in the open market and in private transactions. Through December 31, 2004, 901,616
shares have been purchased at an average price of $4.54 per share. </FONT><FONT face="Times New Roman, Times, Serif" size=2>The Company intends to continue acquiring shares pursuant to its stock repurchase program based upon
the price of the stock and in accordance with applicable rules and regulations.</FONT></P>
<P align=center><FONT face="Times New Roman, Times, serif" size=2>- 6 -</FONT></P>
<HR noShade SIZE=5>

<P style="PAGE-BREAK-BEFORE: always">
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>THE CAPITAL MARKETS DIVISION </B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>In 1991, Siebert created its Capital Markets Group (&#147;SCM&#148;) division, which serves as a co-manager,
underwriting syndicate member, or selling group member on a wide spectrum of securities offerings
for corporations and Federal agencies. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Principal activities of the Capital Markets Division are investment banking and institutional equity
execution services. In June 2004, Siebert expanded its SCM and New York Stock Exchange (&#147;NYSE&#148;)
Floor Operations. SCM provides high-quality brokerage service to both institutional investors and
issuers of equity and fixed-income securities. The NYSE Floor Operation provides institutional investors
with direct access to Siebert&#146;s trading professionals on the NYSE floor.</FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>During 1996, Siebert formed the Siebert, Brandford, Shank division of the investment banking group
to enhance the activities of Siebert&#146;s tax exempt underwriting. The operations of the Siebert,
Brandford, Shank division were moved on July 1, 1998, to a newly formed entity, SBS. Two individuals,
Mr. Napoleon Brandford and Ms. Suzanne F. Shank, own 51% of the equity and are entitled to 51% of
the net profits of SBS and Siebert is entitled to the balance. Through its investment in SBS, Siebert
has become a more significant factor in the tax exempt underwriting area, and expects to enhance
its government and institutional relationships, as well as the breadth of products that can be made
available to retail clients. During 2004, SBS served as the lead manager of over $2 billion of negotiated
municipal new issues and served as a co-manager in over $66 billion of negotiated municipal new issues. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Since its inception, the Siebert, Brandford, Shank division and its successor SBS have co-managed offerings
of approximately $317 billion and lead managed offerings of approximately $12 billion. Clients include
the States of California, Texas, Washington, Ohio and Michigan and the Cities of Chicago, Detroit,
Los Angeles, Houston, Dallas, Denver and St. Louis. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>SBS operates out of offices in San Francisco, New York, Seattle, Houston, Chicago, Detroit, Los Angeles,
Washington, DC, San Antonio, Anchorage, Miami and Dallas. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Certain risks are involved in the underwriting of securities. Underwriting syndicates agree to purchase
securities at a discount from the initial public offering price. An underwriter is exposed to losses
on the securities that it has committed to purchase if the securities must be sold below the cost
to the syndicate.&nbsp;In the last several years, investment banking firms have increasingly underwritten
corporate and municipal offerings with fewer syndicate participants or, in some cases, without an
underwriting syndicate. In these cases, the underwriter assumes a larger part or all of the risk
of an underwriting transaction. Under Federal securities laws, other laws and court decisions, an
underwriter is exposed to substantial potential liability for material misstatements or omissions
of fact in the prospectus used to describe the securities being offered.&nbsp; </FONT></P>
<P align=center><FONT face="Times New Roman, Times, serif" size=2>- 7 -</FONT></P>
<HR noShade SIZE=5>

<P style="PAGE-BREAK-BEFORE: always">
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>ADVERTISING, MARKETING AND PROMOTION </B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Siebert develops and maintains its retail customer base through printed advertising in financial publications,
broadcast commercials over national and local cable TV channels, as well as promotional efforts and
public appearances by Ms. Siebert. Additionally, a significant number of the firm&#146;s new accounts
are developed directly from referrals by satisfied customers. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>COMPETITION </B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Siebert encounters significant competition from full-commission, online and discount brokerage firms,
as well as from financial institutions, mutual fund sponsors and other organizations, many of which
are significantly larger and better capitalized than Siebert. The reduced volume of trading starting
in early 2001 is leading to consolidation in the industry in both the online and traditional brokerage
business. Siebert believes that additional competitors such as banks, insurance companies, providers
of online financial and information services and others will continue to be attracted to the online
brokerage industry as they expand their product lines. Many of these competitors are larger, more
diversified, have greater capital resources, and offer a wider range of services and financial products
than Siebert. Some such firms are offering their services over the Internet and have devoted more
resources to and have more elaborate websites than Siebert. Siebert competes with a wide variety
of vendors of financial services for the same customers. Siebert believes that its main competitive
advantages are high quality customer service, responsiveness, cost and products offered, the breadth
of product line and excellent executions. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>REGULATION </B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>The securities industry in the United States is subject to extensive regulation under both Federal
and state laws. The Securities and Exchange Commission (&#147;SEC&#148;) is the Federal agency charged
with administration of the Federal securities laws. Siebert is registered as a broker-dealer with
the SEC, and is a member of the New York Stock Exchange (&#147;NYSE&#148;) and the National Association
of Securities Dealers (&#147;NASD&#148;). Much of the regulation of broker-dealers has been delegated
to self-regulatory organizations, principally the NASD and national securities exchanges such as
the NYSE, which is Siebert&#146;s primary regulator with respect to financial and operational compliance.
These self-regulatory organizations adopt rules (subject to approval by the SEC) governing the industry
and conduct periodic examinations of broker-dealers. Securities firms are also subject to regulation
by state securities authorities in the states in which they do business. Siebert is registered as
a broker-dealer in 50 states, the District of Columbia and Puerto Rico. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>The principal purpose of regulation and discipline of broker-dealers is the protection of customers
and the securities markets, rather than protection of creditors and stockholders of broker-dealers.
The regulations to which broker-dealers are subject cover all aspects of the securities business,
including training of personnel, sales methods, trading practices among broker-dealers, uses and
safekeeping of customers&#146; funds and securities, capital structure of securities firms, record
keeping, fee arrangements, disclosure to clients, and the conduct of directors, officers and employees.
Additional legislation, changes in rules promulgated by the SEC and by self-regulatory organizations
or changes in the interpretation or enforcement of existing laws and rules may directly affect the
method of operation and profitability of broker-dealers and investment advisers. The SEC, self-regulatory
organizations and state securities authorities may conduct administrative proceedings which can result
in censure, fine, cease and desist orders or suspension or expulsion of a broker-dealer or an investment
adviser, its officers or its employees. </FONT></P>
<P align=center><FONT face="Times New Roman, Times, serif" size=2>- 8 -</FONT></P>
<HR noShade SIZE=5>

<P style="PAGE-BREAK-BEFORE: always">
<P><FONT face="Times New Roman, Times, Serif" size=2>On March 4, 2005, Siebert consented without admitting or denying guilt to a $45,000 fine and censure
by the NYSE due to findings of books-and-records, financial, operational and supervisory deficiencies.
This action was based on technical record keeping and administrative deficiencies and there were
no complaints from and no losses to any Siebert customers. As the NYSE expressly noted, Siebert had
no prior disciplinary history in its 37 years in business.</FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>As a registered broker-dealer and NASD member organization, Siebert is required by Federal law to belong
to the Securities Investor Protection Corporation (&#147;SIPC&#148;) which provides, in the event
of the liquidation of a broker-dealer, protection for securities held in customer accounts held by
the firm of up to $500,000 per customer, subject to a limitation of $100,000 on claims for cash balances.
The SIPC is funded through assessments on registered broker-dealers. In addition, Siebert, through
it&#146;s clearing agent, has purchased from private insurers additional account protection in the
event of liquidation up to the net asset value, as defined, of each account. Stocks, bonds, mutual
funds and money market funds are included at net asset value for purposes of SIPC protection and
the additional protection. Neither SIPC protection nor the additional protection insures against
fluctuations in the market value of securities. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Siebert is also authorized by the Municipal Securities Rulemaking Board to effect transactions in municipal
securities on behalf of its customers and has obtained certain additional registrations with the
SEC and state regulatory agencies necessary to permit it to engage in certain other activities incidental
to its brokerage business. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Margin lending arranged by Siebert is subject to the margin rules of the Board of Governors of the
Federal Reserve System and the NYSE. Under such rules, broker-dealers are limited in the amount they
may lend in connection with certain purchases and short sales of securities and are also required
to impose certain maintenance requirements on the amount of securities and cash held in margin accounts.
In addition, those rules and rules of the Chicago Board Options Exchange govern the amount of margin
customers must provide and maintain in writing uncovered options. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>NET CAPITAL REQUIREMENTS </B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>As a registered broker-dealer, Siebert is subject to the SEC&#146;s Uniform Net Capital Rule (Rule
15c3-1) (the &#147;Net Capital Rule&#148;), which has also been adopted by the NYSE. Siebert is a
member firm of the NYSE and the NASD. The Net Capital Rule specifies minimum net capital requirements
for all registered broker-dealers and is designed to measure financial integrity and liquidity. Failure
to maintain the required regulatory net capital may subject a firm to suspension or expulsion by
the NYSE and the NASD, certain punitive actions by the SEC and other regulatory bodies and, ultimately,
may require a firm&#146;s liquidation. </FONT></P>
<P align=center><FONT face="Times New Roman, Times, serif" size=2>- 9 -</FONT></P>
<HR noShade SIZE=5>

<P style="PAGE-BREAK-BEFORE: always">
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Regulatory net capital is defined as net worth (assets minus liabilities), plus qualifying subordinated
borrowings, less certain deductions that result from excluding assets that are not readily convertible
into cash and from conservatively valuing certain other assets. These deductions include charges
that discount the value of security positions held by Siebert to reflect the possibility of adverse
changes in market value prior to disposition. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>The Net Capital Rule requires notice of equity capital withdrawals to be provided to the SEC prior
to and subsequent to withdrawals exceeding certain sizes. The Net Capital Rule also allows the SEC,
under limited circumstances, to restrict a broker-dealer from withdrawing equity capital for up to
20 business days. The Net Capital Rule of the NYSE also provides that equity capital may not be drawn
or cash dividends paid if resulting net capital would be less than 5 percent of aggregate debits. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Under applicable regulations, Siebert is required to maintain regulatory net capital of at least $250,000.
At December 31, 2004 and 2003, Siebert had net capital of $16.9 million and $15.4 million, respectively.
Siebert claims exemption from the reserve requirement under Section 15c3-3(k)(2)(ii). </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>EMPLOYEES </B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>As of March 10, 2005, the Company had approximately 103 employees, six of whom were corporate officers.
None of the employees is represented by a union, and the Company believes that relations with its
employees are good. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>ITEM 2. PROPERTIES </B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Siebert currently maintains seven retail discount brokerage offices. Customers can visit the offices
to obtain market information, place orders, open accounts, deliver and receive checks and securities,
and obtain related customer services in person. Nevertheless, most of Siebert&#146;s activities are
conducted on the Internet or by telephone and mail. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Siebert operates its business out of the following seven leased offices: </FONT></P>
<TABLE cellSpacing="0" cellPadding="0" width="600" border="0">

<TR vAlign=bottom>
<TH align=left colSpan=2><B><FONT face="Times New Roman, Times, Serif" size=1>Location</FONT></B></TH>
<TH><B><FONT face="Times New Roman, Times, Serif" size=1>Approximate<BR>Office Area in<BR>Square Feet</FONT></B></TH>
<TH>&nbsp;</TH>
<TH><B><FONT face="Times New Roman, Times, Serif" size=1>Expiration Date of<BR>Current<BR>Lease</FONT></B></TH>
<TH>&nbsp;</TH>
<TH><B><FONT face="Times New Roman, Times, Serif" size=1>Renewal<BR>Terms</FONT></B></TH>
<TH>&nbsp;</TH></TR>
<TR vAlign=bottom>
<TD align=left>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=left>
<HR noShade SIZE=1>
</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=left>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Corporate Headquarters, Retail and</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left width="12%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="2%"><FONT face="Times New Roman, Times, Serif" size=2></FONT></TD>
<TD align=left width="20%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left width="19%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><U><FONT face="Times New Roman, Times, Serif" size=2>Investment Banking Office</FONT></U></TD>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>885 Third Ave.</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>New York, NY 10022</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>7,828</FONT></TD>
<TD align="CENTER">&nbsp;</TD>
<TD align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>12/31/06</FONT></TD>
<TD align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>None</FONT></TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><U><FONT face="Times New Roman, Times, Serif" size=2>Retail Offices</FONT></U></TD>
<TD align=left>&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>9693 Wilshire Boulevard</FONT></TD>
<TD align=left width="2%">&nbsp;</TD>
<TD align="CENTER" width="10%">&nbsp;</TD>
<TD align="CENTER" width="4%">&nbsp;</TD>
<TD align="CENTER" width="20%">&nbsp;</TD>
<TD align="CENTER" width="2%">&nbsp;</TD>
<TD align="CENTER" width="19%">&nbsp;</TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Beverly Hills, CA 90212</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>1,000</FONT></TD>
<TD align="CENTER">&nbsp;</TD>
<TD align="CENTER"><FONT size=2>12/31/06</FONT></TD>
<TD align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>1 year option</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>4400 North Federal Highway</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Boca Raton, FL 33431</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>2,438</FONT></TD>
<TD align="CENTER">&nbsp;</TD>
<TD align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>5/31/09</FONT></TD>
<TD align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>None</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>111 Pavonia Avenue<SUP>(1)</SUP></FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2></FONT></TD>
<TD align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>5 year option on a</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Jersey City, NJ 07310</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>7,768</FONT></TD>
<TD align="CENTER">&nbsp;</TD>
<TD align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>6/30/07 and 6/30/09</FONT></TD>
<TD align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>portion of space</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>400 Fifth Avenue &#150; South</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Naples, FL 33940</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>1,008</FONT></TD>
<TD align="CENTER">&nbsp;</TD>
<TD align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>4/30/05</FONT></TD>
<TD align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>None</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>240A South County Road</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Palm Beach, FL 33480</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>770</FONT></TD>
<TD align="CENTER">&nbsp;</TD>
<TD align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>12/31/05</FONT></TD>
<TD align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>None</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>9569 Harding Avenue</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Surfside, FL 33154</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>1,150</FONT></TD>
<TD align="CENTER">&nbsp;</TD>
<TD align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>4/30/07</FONT></TD>
<TD align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>None</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR></TABLE><BR>
<TABLE cellSpacing="0" cellPadding="0" width="100%" border="0">

<TR>
<TD vAlign=top width=33>&nbsp;</TD>
<TD vAlign=top><FONT face="Times New Roman, Times, Serif" size=2>(1)&nbsp;&nbsp;Certain of the Company&#146;s administrative and back office functions are performed
at this location. </FONT></TD></TR></TABLE>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>The Company believes that its properties are in good condition and are suitable for the Company&#146;s
operations. </FONT></P>
<P align=center><FONT face="Times New Roman, Times, serif" size=2>- 10 -</FONT></P>
<HR noShade SIZE=5>

<P style="PAGE-BREAK-BEFORE: always">
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>ITEM 3. LEGAL PROCEEDINGS </B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>See Part I-Item 1 &#147;Business-Current Developments&#148; and Part I-Item 7&#147;Management&#146;s
Discussion and Analysis of Financial Condition and Results of Operations&#148; with respect to the
Company&#146;s lawsuit against Intuit Inc. which was filed in New York State Supreme Court, County
of New York on September 17, 2003 alleging among other things, Intuit&#146;s breach of contractual
obligations, breach of fiduciary duties and misrepresentation and/or fraud, all relating to the Joint
Brokerage services conducted under the Strategic Alliance Agreement between Siebert and Intuit. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>In addition, the Company is involved in various routine lawsuits of a nature deemed by the Company
customary and incidental to its business. In the opinion of management, the ultimate disposition
of such actions will not have a material adverse effect on the financial position or results of operations.
</FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>ITEM 4. &nbsp;SUBMISSION OF MATTERS TO A VOTE OF SHAREHOLDERS </B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>No matter was submitted to a vote of shareholders during the fourth quarter of the fiscal year ended
December 31, 2004.</FONT></P><B></B>
<P align=center><FONT face="Times New Roman, Times, serif" size=2>- 11 -</FONT></P>
<HR noShade SIZE=5>

<P style="PAGE-BREAK-BEFORE: always">
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>PART&nbsp; II </B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>ITEM 5. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;MARKET FOR REGISTRANT&#146;S COMMON EQUITY, RELATED STOCKHOLDER
MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES </B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>The Company&#146;s common stock trades on the Nasdaq Stock Market under the symbol &#147;SIEB&#148;.
The high and low sales prices of the Company&#146;s common stock reported by Nasdaq during the following
calendar quarters were: </FONT></P>
<TABLE cellSpacing="0" cellPadding="0" width="600" border="0">

<TR vAlign=bottom>
<TH colSpan=2><FONT face="Times New Roman, Times, Serif" size=2></FONT></TH>
<TH noWrap align="CENTER" colSpan=2><B><FONT face="Times New Roman, Times, Serif" size=1>HIGH</FONT></B></TH>
<TH noWrap>&nbsp;</TH>
<TH noWrap align="CENTER" colSpan=2><B><FONT face="Times New Roman, Times, Serif" size=1>LOW</FONT></B></TH>
<TH>&nbsp;</TH></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>First Quarter - 2003</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right width="5%"><FONT face="Times New Roman, Times, Serif" size=2>2.77</FONT></TD>
<TD align=left width="4%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right width="5%"><FONT face="Times New Roman, Times, Serif" size=2>2.18</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR>
<TD colSpan=8>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Second Quarter - 2003</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>5.40</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>2.27</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR>
<TD colSpan=8>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Third Quarter - 2003</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>5.40</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>4.13</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR>
<TD colSpan=8>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Fourth Quarter - 2003</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>4.35</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>2.50</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR>
<TD colSpan=8>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>First Quarter - 2004</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>4.69</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>3.41</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR>
<TD colSpan=8>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Second Quarter - 2004</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>5.32</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>3.64</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR>
<TD colSpan=8>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Third Quarter - 2004</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>4.35</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>2.74</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR>
<TD colSpan=8>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Fourth Quarter - 2004</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>4.20</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>2.94</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR>
<TD colSpan=8>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>January 1, 2005 - March 11, 2005</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>3.95</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>3.17</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR></TABLE>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>On March 11, 2005, the closing price of the Company&#146;s common stock on the Nasdaq Stock Market
was $3.45 per share. There were 155 holders of record of the Company&#146;s common stock and more
than 2,500 beneficial owners of common stock on March 5, 2005. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>DIVIDEND POLICY </B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>The Company paid no cash dividends to its shareholders in 2004, 2003 and 2002. Ms. Siebert, the majority
shareholder of the Company, has waived her right to receive the dividends declared by the Company
to date although she intends to participate in dividends declared in the future. The Board of Directors
of the Company periodically considers whether to declare dividends. In considering whether to pay
such dividends, the Company&#146;s Board of Directors will review the earnings of the Company, its
capital requirements, its economic forecasts and such other factors as are deemed relevant. Some
portion of the Company&#146;s earnings will be retained to provide capital for the operation and
expansion of its business. </FONT></P>
<P align=center><FONT face="Times New Roman, Times, serif" size=2>- 12 -</FONT></P>
<HR noShade SIZE=5>

<P style="PAGE-BREAK-BEFORE: always">
<P><FONT face="Times New Roman, Times, Serif" size=2><B>Issuer Purchase of Equity Securities</B></FONT></P>
<P><FONT face="Times New Roman, Times, Serif" size=2>The following table sets forth information regarding the Company&#146;s purchase of its common stock
on a monthly basis during the fourth quarter of 2004:</FONT></P>
<TABLE cellSpacing="0" cellPadding="0" width="600" border="0">

<TR vAlign=bottom>
<TH noWrap><B><FONT face="Times New Roman, Times, Serif" size=1>Period</FONT></B></TH>
<TH noWrap>&nbsp;</TH>
<TH noWrap colSpan=2><B><FONT face="Times New Roman, Times, Serif" size=1>Total Number<BR>Of Shares<BR>Purchased<BR>During &nbsp;Period</FONT></B></TH>
<TH noWrap>&nbsp;</TH>
<TH noWrap colSpan=2><B><FONT face="Times New Roman, Times, Serif" size=1>Average Price<BR>Paid Per Share </FONT></B></TH>
<TH noWrap>&nbsp;</TH>
<TH noWrap colSpan=2><B><FONT face="Times New Roman, Times, Serif" size=1>Total Number of<BR>Shares Purchased as <BR>Part of Publicly<BR>Announced<BR>Plans(1) </FONT></B></TH>
<TH noWrap>&nbsp;</TH>
<TH noWrap colSpan=2><B><FONT face="Times New Roman, Times, Serif" size=1>Maximum <BR>Number of Shares<BR>That May Yet Be <BR>Purchased Under<BR>The Plan </FONT></B></TH>
<TH>&nbsp;</TH></TR>
<TR vAlign=bottom>
<TD align=left>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>October 2004</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>898,716</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>101,284</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>November 2004</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align="CENTER" width="15%"><FONT face="Times New Roman, Times, Serif" size=2>600</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align="CENTER" width="15%"><FONT face="Times New Roman, Times, Serif" size=2>3.13</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=right width="1%">&nbsp;</TD>
<TD align="CENTER" width="15%"><FONT face="Times New Roman, Times, Serif" size=2>899,316</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=right width="1%">&nbsp;</TD>
<TD align="CENTER" width="15%"><FONT face="Times New Roman, Times, Serif" size=2>100,684</FONT></TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>December 2004</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align="CENTER"><U><FONT face="Times New Roman, Times, Serif" size=2>2,300</FONT></U></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>3.09</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>901,616</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>98,384</FONT></TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align="CENTER">&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Total</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>2,900</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>3.10</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>901,616</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>98,384</FONT></TD>
<TD align=left>&nbsp;</TD></TR></TABLE>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>(1) On May 15, 2000, the Board of Directors of the Company authorized a buy back of up to one million
shares of the Company&#146;s common stock. Under this program, shares are purchased from time to
time, at the Company&#146;s discretion, in the open market and in private transactions.</FONT></P><B></B>
<P align=center><FONT face="Times New Roman, Times, serif" size=2>- 13 -</FONT></P>
<HR noShade SIZE=5>

<P style="PAGE-BREAK-BEFORE: always">
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>ITEM 6. SELECTED FINANCIAL DATA <BR></B></FONT><FONT face="Times New Roman, Times, Serif" size=2>(In thousands except share and per share data) </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
THE FOLLOWING SELECTED FINANCIAL INFORMATION<BR></FONT><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
SHOULD BE READ IN CONJUNCTION WITH THE<BR></FONT><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
COMPANY&#146;S CONSOLIDATED FINANCIAL<BR></FONT><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
STATEMENTS AND THE RELATED NOTES THERETO.</FONT></P>
<TABLE cellSpacing="0" cellPadding="0" width=760 border="0">

<TR vAlign=bottom>
<TH colSpan=2><FONT face="Times New Roman, Times, serif" size=1></FONT></TH>
<TH colSpan=2><B><FONT face="Times New Roman, Times, serif" size=1>2004</FONT></B></TH>
<TH><FONT face="Times New Roman, Times, serif" size=1></FONT></TH>
<TH colSpan=2><B><FONT face="Times New Roman, Times, serif" size=1>2003</FONT></B></TH>
<TH><FONT face="Times New Roman, Times, serif" size=1></FONT></TH>
<TH colSpan=2><B><FONT face="Times New Roman, Times, serif" size=1>2002</FONT></B></TH>
<TH><FONT face="Times New Roman, Times, serif" size=1></FONT></TH>
<TH colSpan=2><B><FONT face="Times New Roman, Times, serif" size=1>2001</FONT></B></TH>
<TH><FONT face="Times New Roman, Times, serif" size=1></FONT></TH>
<TH colSpan=2><B><FONT face="Times New Roman, Times, serif" size=1>2000</FONT></B></TH>
<TH><FONT face="Times New Roman, Times, serif" size=1></FONT></TH></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=1>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=1>&nbsp;</FONT></TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=1>&nbsp;</FONT></TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=1>&nbsp;</FONT></TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=1>&nbsp;</FONT></TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=1>&nbsp;</FONT></TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=1>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=1>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=1>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=1>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=1>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=1>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=1>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=1>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=1>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=1>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=1>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=1>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=1>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=1>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=1>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=1>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=1>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=1>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Income statement data:</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="9%"><FONT face="Times New Roman, Times, Serif" size=2></FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="9%"><FONT face="Times New Roman, Times, Serif" size=2></FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="9%"><FONT face="Times New Roman, Times, Serif" size=2></FONT></TD>
<TD align=left width="3%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="9%"><FONT face="Times New Roman, Times, Serif" size=2></FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="9%"><FONT face="Times New Roman, Times, Serif" size=2></FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Total Revenues</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>28,104</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>24,696</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>24,104</FONT></TD>
<TD align=left width="3%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>32,020</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>44,341</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Net income (loss)</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>533</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>123</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(1,633</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>2,488</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>7,999</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Net income (loss) per share of common stock</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Basic</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>0.02</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>0.01</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(0.07</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>0.11</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>0.35</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Diluted</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>0.02</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>0.01</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(0.07</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>0.11</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>0.34</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Weighted average shares outstanding (basic)</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>22,113,228</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>22,305,369</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>22,403,990</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>22,438,719</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>22,886,100</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Weighted average shares outstanding (diluted)</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>22,276,562</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>22,453,538</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>22,403,990</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>22,698,934</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>23,265,897</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Statement of financial condition data (at year-end):</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Total assets</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>41,560</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>40,026</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>40,451</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>42,129</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>41,428</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Total liabilities excluding subordinated borrowings</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>6,460</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>4,891</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>4,784</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>4,829</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>4,744</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Stockholders&#146; equity</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>35,100</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>35,135</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>35,667</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>37,300</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>36,684</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR></TABLE>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>ITEM 7. &nbsp;MANAGEMENT&#146;S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
</B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>This discussion should be read in conjunction with the Company&#146;s audited Consolidated Financial
Statements and the Notes thereto contained elsewhere in this Annual Report. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>The overall market conditions improved in 2004 and as a result client activity improved as well. Consequently,
customer trading activity increased for the Company, as well as for the entire brokerage industry.
</FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Competition continued to intensify among all types of brokerage firms, including established discount
brokers and new firms entering the on-line brokerage business. Electronic trading continues to account
for an increasing amount of trading activity, with some firms charging very low trading execution
fees that are difficult for any conventional discount firm to meet. Some of these brokers, however,
impose asset based charges for services such as mailing, transfers and handling exchanges which the
Company does not currently impose, and also direct their orders to market makers where they have
a financial interest. Continued competition could limit the Company&#146;s growth or even lead to
a decline in the Company&#146;s customer base, which would adversely affect its results of operations.
Industry-wide changes in trading practices, such as the New York Stock Exchange&#146;s Hybrid Market
proposal and the increasing use of Electronic Communications Networks, are expected to put continuing
pressure on commissions/fees earned by brokers while increasing volatility. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>On May 15, 2000, the Board of Directors of the Company authorized a buy back of up to one million shares
of the Company&#146;s common stock. Under this program, shares are purchased from time to time, at
the Company&#146;s discretion, in the open market and in private transactions. Through March 14,
2005, 901,616 shares have been purchased at an average price of $4.54 per share. </FONT></P>
<P align=center><FONT face="Times New Roman, Times, serif" size=2>- 14 -</FONT></P>
<HR noShade SIZE=5>

<P style="PAGE-BREAK-BEFORE: always">
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>The Company, like other securities firms, is directly affected by general economic and market conditions
including fluctuations in volume and prices of securities, changes and the prospect of changes in
interest rates, and demand for brokerage and investment banking services, all of which can affect
the Company&#146;s profitability. In addition, in periods of reduced financial market activity, profitability
is likely to be adversely affected because certain expenses remain relatively fixed, including salaries
and related costs, portions of communications costs and occupancy expenses. Accordingly, earnings
for any period should not be considered representative of earnings to be expected for any other period. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Siebert filed a lawsuit against Intuit, Inc. (&#147;Intuit&#148;), in New York State Supreme Court


on September 17, 2003 (the &#147;Intuit Lawsuit&#148;), seeking not less than $11.1 million in

compensatory
damages and $33.3 million in punitive damages for claims relating to the Joint Brokerage

Service
(the &#147;JBS&#148;) conducted during the years ended December 31, 2003 and 2002 under

the Strategic
Alliance Agreement between Siebert and Intuit. A motion by Intuit to stay the lawsuit

and require
that the dispute be submitted to arbitration was denied in a decision of the Supreme

Court dated
January 7, 2004. Intuit&#146;s motion to reargue the Court&#146;s decision was denied

by the Court
in a decision dated June 7, 2004. Intuit appealed both decisions to the Appellate

Division of the
Supreme Court. By a unanimous decision and order dated October 28, 2004, the
Appellate
Division affirmed
the lower Court&#146;s January 7, 2004 decision, denying Intuit&#146;s
motion
to compel arbitration
and stay litigation. By further order of the Appellate Division
dated January
4, 2005, Intuit&#146;s
motion for reargument or for leave to appeal to the Court
of Appeals was
denied. On February 7, 2005,
Intuit made a motion directly to the Court of Appeals
for leave to
appeal to that Court from the
Appellate Division&#146;s order of October 28, 2004.
Intuit&#146;s
motion and Siebert&#146;s answering
papers were submitted to the Court of Appeals
for decision
on February 22, 2005. By a decision announced
on March 29, 2005, the court of Appeals
denied Intuit&#146;s
motion for leave to appeal, thereby
ending any controversy over Siebert&#146;s
right to litigate
in court rather than arbitrate. </FONT><FONT face="Times New Roman, Times, Serif" size=2>In addition, Intuit has also moved in the Supreme Court, on February 4, 2005, to dismiss five of the


six causes of action asserted by Siebert in the Intuit Lawsuit. </FONT><FONT face="Times New Roman, Times, Serif" size=2>Siebert&#146;s answering papers and Intuit&#146;s reply papers on that motion are scheduled to be submitted


to the Supreme Court on April 11, 2005. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><STRONG>CRITICAL ACCOUNTING POLICIES</STRONG></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>The Company generally follows accounting policies standard in the brokerage industry and believes that
its policies appropriately reflect its financial position and results of operations. Management has
identified the use of &#147;estimates&#148; as its critical policy. The estimates relate primarily
to revenue and expense items in the normal course of business as to which the Company receives no
confirmations, invoices, or other documentation, at the time the books are closed for a period. The
Company uses its best judgment, based on its knowledge of revenue transactions and expenses incurred,
to estimate the amount of such revenue and expenses. The Company is not aware of any material differences
between the estimates used in closing its books for the last five years and the actual amounts of
revenue and expenses incurred when the Company subsequently receives the actual confirmations, invoices
or other documentation. Estimates are also used in determining the useful lives of intangibles assets,
and the fair market value of intangible assets. Management believes that its estimates are reasonable. </FONT></P>
<P align=center><FONT face="Times New Roman, Times, serif" size=2>- 15 -</FONT></P>
<HR noShade SIZE=5>

<P style="PAGE-BREAK-BEFORE: always">
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>RESULTS OF OPERATIONS <BR></B></FONT><FONT face="Times New Roman, Times, Serif" size=2><B>YEAR ENDED DECEMBER 31, 2004 COMPARED TO <BR></B></FONT><FONT face="Times New Roman, Times, Serif" size=2><B>YEAR ENDED DECEMBER 31, 2003 </B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>REVENUES. Total revenues for 2004 were $28.1 million, an increase of $3.4 million, or 13.8%, from 2003.
Commission and fee income increased $3.3 million, or 16.3%, from the prior year to $23.8 million
due to increased trading volume and higher margin debit balances maintained by the Company&#146;s
retail customer base in 2004.</FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Investment banking revenues increased $277,000, or 25.5%, from the prior year to $1.4 million in 2004
due to an increase in activity in the new issue market and the addition of new capital markets personnel.
</FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Income from the Company&#146;s investment in Siebert, Brandford, Shank &amp; Co., LLC (&#147;SBS&#148;)
for 2004 was $1.7 million compared to income of $1.9 million for the prior year. This decrease in
profits was due in part to the decreased number of municipal bond offerings managed or co-managed
by SBS. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Trading profits decreased $43,000, or 5.4%, from the prior year to $761,000 primarily due to decreased
trading in municipal, government and corporate bonds within the Company&#146;s riskless trading group.
</FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Income from interest and dividends increased $20,000, or 4.4%, from the prior year to $470,000 primarily
due to interest earned on a $25 million subordinated loan obtained from the Company&#146;s clearing
firm that was required by an issuer to participate in its initial public offering, and higher interest
rates offset by the maturing of municipal bonds that provided higher yields. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>EXPENSES. Total expenses for 2004 were $27.1 million, an increase of $2.6 million, or 10.7%, from the
prior year. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Employee compensation and benefit costs increased $2.4 million, or 27.7%, from the prior year to $11.1
million primarily due to the hiring of the Company&#146;s General Counsel, the expansion of the Company&#146;s
Capital Markets Group and the New York Stock Exchange Floor Operation and increase in bonus accruals.
</FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif"><FONT size=2>Clearing and floor brokerage fees decreased $29,000, or 0.07%, from the prior year to $4.24 million
primarily due to a one time commission rebate of $ 800,000 from the Company&#146;s clearing firm
offset by the increased volume of trade executions.</FONT></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Advertising and promotion expense decreased $251,000, or 18.5%, from the prior year to $1.1 million
primarily due to management&#146;s decision to spend less for advertising and promotion. </FONT></P>
<P align=center><FONT face="Times New Roman, Times, serif" size=2>- 16 -</FONT></P>
<HR noShade SIZE=5>

<P style="PAGE-BREAK-BEFORE: always">
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Communications expense decreased $507,000, or 17.9%, from the prior year to $2.3 million primarily
due to management&#146;s effort to control and maintain these costs. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Occupancy costs decreased $56,000, or 5.0%, from the prior year to $1.1 million principally due to
the combining of the Company&#146;s Boca Raton office with Your Discount Broker, Inc&#146;s Boca
Raton office into a larger branch. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Other general and administrative expenses decreased $482,000, or 7.8%, from the prior year to $5.7
million primarily due to the elimination of product development costs relating to the JBS offset
by costs relating to the Company entering into the commission recapture business and the cost of
leasing an additional seat on the New York Stock Exchange as the Company expanded the New York Stock
Exchange Floor Operation.</FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Taxes. The provision for income taxes increased by $380,000, or 542.9% from the prior year to $450,000
due to an increase in net income before tax to $983,000 in 2004 from $193,000 in 2003.</FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>YEAR ENDED DECEMBER 31, 2003 COMPARED TO YEAR ENDED DECEMBER 31, 2002</B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>REVENUES. Total revenues for 2003 were $24.7 million, an increase of $592,000, or 2.5%, from 2002.
Commission and fee income increased $1.1 million, or 5.6%, from the prior year to $20.5 million due
to increased customer trading volume in the last nine months of 2003 to offset the weak market conditions
in the first quarter 2003. There was a lack of interest in buying stocks in the first quarter of
2003 due to the war in Iraq. Investment banking revenues decreased $392,000, or 26.5%, from the prior
year to $1.1 million in 2003, primarily due to weaker market conditions. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Income from the Company&#146;s investment in Siebert, Brandford, Shank &amp; Co., LLC (&#147;SBS&#148;)
for 2003 was $1.9 million compared to income of $1.8 million for the prior year. This increase in
profits was due in part to the increased number of municipal bond offerings managed or co-managed
by SBS as interest in municipal bonds increased and SBS&#146;s share of the municipal bond underwriting
market increased. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Trading profits decreased $46,000, or 5.4%, from the prior year to $804,000 primarily due to decreased
trading in municipal, government and corporate bonds within the Company&#146;s proprietary and riskless
trading group. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Income from interest and dividends decreased $188,000, or 29.5%, from the prior year to $450,000 primarily
due to lower yields on money market funds held by the Company during 2003. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>EXPENSES. Total expenses for 2003 were $24.5 million, a decrease of $2.8 million, or 10.3%, from the
prior year. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Employee compensation and benefit costs decreased $459,000, or 5.0%, from the prior year to $8.7 million
primarily due to a decrease in the number of employees and a decrease in discretionary bonuses offset,
in part, by an increase in employee expenses of $174,000 due to Siebert&#146;s participation in the
JBS with Intuit described above. </FONT></P>
<P align=center><FONT face="Times New Roman, Times, serif" size=2>- 17 -</FONT></P>
<HR noShade SIZE=5>

<P style="PAGE-BREAK-BEFORE: always">
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Clearing and floor brokerage fees increased $570,000, or 15.4%, from the prior year to $4.3 million
due to the increased volume of trades executed. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Advertising and promotion expense decreased $1.5 million, or 53.2%, from the prior year to $1.4 million
primarily due to management&#146;s decision to spend less for advertising and promotion. Approximately
$255,000 of total advertising and promotion expenses related directly to Siebert&#146;s participation
in the JBS with Intuit. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Communications expense increased $527,000, or 22.8%, from the prior year, to $2.8 million primarily
due higher volume of call traffic and quotes usage by our customers and $367,000 relating to Siebert&#146;s
participation in the JBS. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Occupancy costs increased $199,000, or 21.5%, from the prior year to $1.1 million principally due to
the temporary rental addition of office space in Boca Raton, Florida, previously occupied by Your
Discount Broker Inc. (&#147;YDB&#148;), as well as an increase in occupancy costs of $51,000 relating
to the JBS. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>General&nbsp;and administrative. Other general and administrative expenses decreased $2.1 million,
or 25.5%, from the prior year to $6.2 million primarily due to the expensing of non-recurring start-up
costs for the JBS of an advisory fee of $1 million and legal fees of $392,000 in 2002 as well as
a decrease in research and development costs relating to the JBS of $648,000 in 2003.</FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Taxes. The provision for income taxes of $70,000 for 2003 is a result of a income before taxes of $193,000
compared to net loss before income tax of $3.2 million in 2002 and a benefit for income taxes $1.6
million.</FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>LIQUIDITY AND CAPITAL RESOURCES </B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>The Company&#146;s assets are highly liquid, consisting generally of cash, money market funds and securities
freely saleable in the open market. The Company&#146;s total assets at December 31, 2004 were $42
million, of which, $31.5 million, or 76%, were regarded by the Company as highly liquid. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Siebert is subject to the net capital requirements of the SEC, the NYSE and other regulatory authorities.
At December 31, 2004, Siebert&#146;s regulatory net capital was $16.9 million, $16.6 million in excess
of its minimum capital requirement of $250,000. </FONT></P>
<P><FONT face="Times New Roman, Times, Serif" size=2>Siebert terminated the fully disclosed clearing agreement (the &#147;Clearing Agreement&#148;) with
Pershing LLC (formerly the Pershing division of Donaldson, Lufkin &amp; Jenrette Securities Corporation)
(&#147;Pershing&#148;). Based on consultation with counsel, Siebert believes that the $1,500,000
that it advanced to Pershing in January 2003 should be returned and that Pershing may be liable for
damages. Pershing has expressed its belief that it is entitled to retain the advance and receive
a minimum of $3 million for its unreimbursed costs, a termination fee of $500,000 and $5 million
for lost revenues. Siebert believes the Pershing claims are without merit and that the ultimate result
of this matter will not have a material adverse effect on result of operations or financial positions.
Siebert has decided not to commence proceedings against Pershing at the present time. As a result,
Siebert has charged the $1,500,000 advance to Pershing against income in the fourth quarter of 2004
since recent communication indicated that Pershing and the Company cannot resolve this matter.</FONT></P>
<P align=center><FONT face="Times New Roman, Times, serif" size=2>- 18 -</FONT></P>
<HR noShade SIZE=5>

<P style="PAGE-BREAK-BEFORE: always">
<P><FONT face="Times New Roman, Times, Serif" size=2>In August 2004, Siebert participated as an underwriter in the Google, Inc. initial public offering.
To participate as an underwriter, the lead Investment Banks (the &#147;Banks&#148;) requested that
each underwriter provide the Banks with a $25 million Letter of Credit on behalf of each underwriter
in favor of the Banks. To obtain the Letter of Credit, Siebert entered into a Temporary Subordinated
Loan Agreement with NFS. On August 6, 2004, Siebert&nbsp;obtained a Letter of Credit for $25 million
and terminated the Letter of Credit and paid the Temporary Subordinated Loan Agreement with NFS on
September 15, 2004</FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>The Company also intends to acquire additional shares of its common stock pursuant to its share buy
back program. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Siebert has entered into a Secured Demand Note Collateral Agreement with SBS under which it is obligated
to loan to SBS up to $1.2 million pursuant to a secured promissory note on a subordinated basis.
Amounts obligated to be loaned by Siebert under the facility are reflected on the Company&#146;s
balance sheet as &#147;cash equivalents - restricted&#148;. SBS pays Siebert interest on this amount
at the rate of 8% per annum. The facility expires on August 31, 2005, at which time SBS is obligated
to repay to Siebert any amounts borrowed by SBS thereunder. </FONT></P>
<P><FONT face="Times New Roman, Times, Serif" size=2>Below is a table that presents the Company&#146;s obligations and commitments at December 31, 2004:</FONT></P>
<TABLE cellSpacing="0" cellPadding="0" width="600" border="0">

<TR>
<TD><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align="CENTER" colSpan=5><B><FONT face="Times New Roman, Times, serif" size=1>Payment Due By Period </FONT></B></TD></TR>
<TR>
<TD><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD noWrap align="CENTER"><B><FONT face="Times New Roman, Times, serif" size=1>Total</FONT></B></TD>
<TD noWrap align="CENTER"><B><FONT face="Times New Roman, Times, serif" size=1>Less Than<BR>1 Year </FONT></B></TD>
<TD noWrap align="CENTER"><B><FONT face="Times New Roman, Times, serif" size=1>1-3 Years </FONT></B></TD>
<TD noWrap align="CENTER"><B><FONT face="Times New Roman, Times, serif" size=1>3-5 Years </FONT></B></TD>
<TD noWrap align="CENTER"><B><FONT face="Times New Roman, Times, serif" size=1>More Than<BR>Five YEars </FONT></B></TD></TR>
<TR>
<TD noWrap><FONT face="Times New Roman, Times, serif" size=2>Contractual Obligations</FONT></TD>
<TD><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD noWrap align="CENTER" width="11%">&nbsp;</TD>
<TD noWrap align="CENTER" width="11%">&nbsp;</TD>
<TD noWrap align="CENTER" width="11%">&nbsp;</TD>
<TD noWrap align="CENTER" width="11%">&nbsp;</TD>
<TD noWrap align="CENTER" width="11%">&nbsp;</TD></TR>
<TR>
<TD><FONT face="Times New Roman, Times, serif" size=2>Operating lease obligations </FONT></TD>
<TD><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD noWrap align="CENTER"><FONT face="Times New Roman, Times, serif" size=2>$ 2,566,000 </FONT></TD>
<TD noWrap align="CENTER"><FONT face="Times New Roman, Times, serif" size=2>$850,000</FONT></TD>
<TD noWrap align="CENTER"><FONT face="Times New Roman, Times, serif" size=2>$1,167,000</FONT></TD>
<TD noWrap align="CENTER"><FONT face="Times New Roman, Times, serif" size=2>$549,000</FONT></TD>
<TD noWrap align="CENTER"><FONT face="Times New Roman, Times, serif" size=2>$0</FONT></TD></TR></TABLE>
<P align=left><STRONG><FONT size=2>ITEM 7A. &nbsp;QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK </FONT></STRONG></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>FINANCIAL INSTRUMENTS HELD FOR TRADING PURPOSES: </B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Through Siebert, the Company maintains inventories in exchange-listed and Nasdaq equity securities
and municipal securities on both a long and short basis. The fair value of all long and short positions
held by Siebert at December 31, 2004 was zero. The Company does not engage in derivative transactions,
has no interest in any special purpose entity and has no liabilities, contingent or otherwise, for
the debt of another entity, except for Siebert&#146;s obligation under its Secured Demand Note Collateral
Agreement of $1.2 million executed in favor of SBS. SBS pays Siebert interest on this amount at the
rate of 8% per annum. Siebert earned interest of $120,000 from SBS in each of the years that Siebert&#146;s
commitment has been outstanding. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>FINANCIAL INSTRUMENTS HELD FOR PURPOSES OTHER THAN TRADING: </B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Working capital is generally temporarily invested in dollar denominated money market funds and overnight
certificates of deposits. These investments are not subject to material changes in value due to interest
rate movements. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>In the normal course of its business, Siebert enters into transactions in various financial instruments
with off-balance sheet risk. This risk includes both market and credit risk, which may be in excess
of the amounts recognized in the Company&#146;s financial statements. Retail customer transactions
are cleared through clearing brokers on a fully disclosed basis. If customers do not fulfill their
contractual obligations, the clearing broker may charge Siebert for any loss incurred in connection
with the purchase or sale of securities at prevailing market prices to satisfy the customers&#146;
obligations. Siebert regularly monitors the activity in its customer accounts for compliance with
its margin requirements. Siebert is exposed to the risk of loss on unsettled customer transactions
if customers and other counterparties are unable to fulfill their contractual obligations. </FONT></P>
<P align=center><FONT face="Times New Roman, Times, serif" size=2>- 19 -</FONT></P>
<HR noShade SIZE=5>

<P style="PAGE-BREAK-BEFORE: always">
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>ITEM 8. &nbsp;FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA</B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>See financial statements and supplementary data required pursuant to this item beginning on page F-1
of this Report on Form 10-K. </FONT></P>
<TABLE cellSpacing="0" cellPadding="0" width="100%" border="0">

<TR>
<TD vAlign=top width="9%"><FONT face="Times New Roman, Times, Serif" size=2><B>ITEM 9.</B></FONT></TD>
<TD vAlign=top><FONT face="Times New Roman, Times, Serif" size=2><B>CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE </B></FONT></TD></TR></TABLE><BR>
<TABLE cellSpacing="0" cellPadding="0" width="100%" border="0">

<TR>
<TD vAlign=top width="9%">&nbsp;</TD>
<TD vAlign=top><FONT face="Times New Roman, Times, Serif" size=2>None. </FONT></TD></TR></TABLE>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>ITEM 9A. CONTROLS AND PROCEDURES </B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>The Company carried out an evaluation, under the supervision and with the participation of management,
including the Company&#146;s President and Chief Financial Officer, of the effectiveness of the design
and operation of the Company&#146;s disclosure controls and procedures as of the end of the period
covered by this report pursuant to Rule 13a-15 of Securities Exchange of 1934, as amended. Based
on that evaluation, the Company&#146;s management, including the President and Chief Financial Officer,
concluded that the Company&#146;s disclosure controls and procedures are effective in timely alerting
them to material information relating to the Company that is required to be included in the Company&#146;s
periodic filings with the Securities and Exchange Commission. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>There were no changes in the Company&#146;s internal controls over financial reporting that occurred
during the Company&#146;s most recent fiscal quarter that have materially affected, or are reasonably
likely to materially affect the Company&#146;s internal controls over financial reporting. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>ITEM 9B. OTHER INFORMATION</B></FONT></P>
<TABLE cellSpacing="0" cellPadding="0" width="100%" border="0">

<TR>
<TD vAlign=top width="4%">&nbsp;</TD>
<TD vAlign=top><FONT face="Times New Roman, Times, Serif" size=2>None</FONT></TD></TR></TABLE>
<P align=center><FONT face="Times New Roman, Times, serif" size=2>- 20 -</FONT></P>
<HR noShade SIZE=5>

<P style="PAGE-BREAK-BEFORE: always">
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>PART&nbsp; III </B></FONT></P>
<P><FONT face="Times New Roman, Times, Serif" size=2><B>ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT</B></FONT></P>
<TABLE cellSpacing="0" cellPadding="0" width="100%" border="0">

<TR>
<TD vAlign=top width="4%">&nbsp;</TD>
<TD vAlign=top><FONT face="Times New Roman, Times, Serif" size=2>(a)&nbsp;&nbsp;&nbsp; Identification of Directors </FONT></TD></TR></TABLE>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>This information is incorporated by reference from the Company&#146;s definitive proxy statement to
be filed by the Company pursuant to Regulation 14A on or prior to April 30, 2005. </FONT></P>
<TABLE cellSpacing="0" cellPadding="0" width="100%" border="0">

<TR>
<TD vAlign=top width="4%">&nbsp;</TD>
<TD vAlign=top><FONT face="Times New Roman, Times, Serif" size=2>(b)&nbsp;&nbsp;&nbsp; Identification of Executive Officers </FONT></TD></TR></TABLE><BR>
<TABLE cellSpacing="0" cellPadding="0" width="600" border="0">

<TR vAlign=bottom>
<TH align=left><FONT face="Times New Roman, Times, Serif" size=1>NAME</FONT></TH>
<TH>&nbsp;</TH>
<TH align=left><FONT face="Times New Roman, Times, Serif" size=1>AGE</FONT></TH>
<TH>&nbsp;</TH>
<TH align=left><FONT face="Times New Roman, Times, Serif" size=1>POSITION</FONT></TH>
<TH>&nbsp;</TH></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Muriel F. Siebert</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left width="10%"><FONT face="Times New Roman, Times, Serif" size=2>72</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Chairwoman and President</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR>
<TD colSpan=2></TD>
<TD colSpan=2></TD>
<TD colSpan=2></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Nicholas P. Dermigny</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>47</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Executive Vice President and</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Chief Operating Officer</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR>
<TD colSpan=2></TD>
<TD colSpan=2></TD>
<TD colSpan=2></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Ameen Esmail</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>46</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Executive Vice President and</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Director of Business Development</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR>
<TD colSpan=2></TD>
<TD colSpan=2></TD>
<TD colSpan=2></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Joseph M. Ramos, Jr.</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>46</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Executive Vice President and</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Chief Financial Officer</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR>
<TD colSpan=2></TD>
<TD colSpan=2></TD>
<TD colSpan=2></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Jeanne Rosendale</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>40</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Executive Vice President and</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>General Counsel</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR>
<TD colSpan=2></TD>
<TD colSpan=2></TD>
<TD colSpan=2></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Daniel Iesu</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>45</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Secretary</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR></TABLE>
<P><FONT face="Times New Roman, Times, Serif" size=2>Certain information regarding each executive officer&#146;s business experience is set forth below. </FONT></P>
<P><FONT face="Times New Roman, Times, Serif" size=2>MURIEL F. SIEBERT has been Chairwoman, President and a director of Siebert since 1967 and the Company
since November 8, 1996. Ms. Siebert became the first woman member of the New York Stock Exchange
on December 28, 1967 and served as the first woman Superintendent of Banks of the State of New York
from 1977 to 1982. She is director of the New York State Business Council and the Boy Scouts of Greater
New York. She is the founder and past president of the International Woman&#146;s Forum, a member
of the State of New York Commission on Judicial Nomination and on the executive committee of the
Economic Club of New York. </FONT></P>
<P><FONT face="Times New Roman, Times, Serif" size=2>NICHOLAS P. DERMIGNY has been Executive Vice President and Chief Operating Officer of Siebert since
joining the firm in 1989 and of the Company since November 8, 1996. Prior to 1993, he was responsible
for Siebert&#146;s retail division. Mr. Dermigny became an officer and director of the Company on
November 8, 1996. </FONT></P>
<P><FONT face="Times New Roman, Times, Serif" size=2>AMEEN ESMAIL has been Executive Vice President and Director of Business Development since July 3, 2003.
From 1984 to 1996, Mr. Esmail served as an Executive Vice President of Siebert. From 1996 to 2003,
Mr. Esmail worked as an independent consultant servicing the financial securities industry. Mr. Esmail
earned a MBA from New York University&#146;s Stern&#146;s Graduate School of Business in 2000. </FONT></P>
<P align=center><FONT face="Times New Roman, Times, serif" size=2>- 21 -</FONT></P>
<HR noShade SIZE=5>

<P style="PAGE-BREAK-BEFORE: always">
<P><FONT face="Times New Roman, Times, Serif" size=2>JOSEPH M. RAMOS, JR. has been Executive Vice President, Chief Financial Officer and Assistant Secretary
of Siebert since February 10, 2003. From May 1999 to February 2002, Mr. Ramos served as Chief Financial
Officer of A.B. Watley Group, Inc. From November 1996 to May 1999, Mr. Ramos served as Chief Financial
Officer of Nikko Securities International, Inc. From September 1987 to March 1996, Mr. Ramos worked
at Cantor Fitzgerald and held various accounting and management positions, the last as Chief Financial
Officer of their registered broker-dealer based in Los Angeles. From October 1982 to September 1987,
Mr. Ramos was an audit manager for Deloitte &amp; Touche LLP, a public accounting firm. Mr. Ramos
is a Certified Public Accountant licensed in the State of New York. </FONT></P>
<P><FONT face="Times New Roman, Times, Serif" size=2>JEANNE M. ROSENDALE has been Executive Vice President, General Counsel of Siebert since May 3, 2004.
From February 2003 to April 2004, Ms. Rosendale served as Global Director Compliance for Knight Equity
Markets. From 2001 through the end of 2002, Ms. Rosendale served as Managing Director, General Counsel
and Chief Compliance Officer for TD Securities (USA) Inc. Ms. Rosendale&#146;s background likewise
includes senior level legal positions with Citigroup and the law firm Weil Gotshal&nbsp;&amp; Manges,
LLP. Ms. Rosendale received both her B.A. and J.D., with honors, from Fordham University. She is
active in various industry groups such as the SIA, the Bond Market Association, the LSTA and ISDA.</FONT></P>
<P><FONT face="Times New Roman, Times, Serif" size=2>DANIEL IESU has been Secretary of Siebert since October 1996 and the Company since November 8, 1996.
He has been Controller of Siebert since 1989. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Compliance with Section 16(a)
of the Exchange Act</FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>This information is incorporated by reference from the Company&#146;s definitive proxy statement to
be filed by the Company pursuant to Regulation 14A on or prior to April 30, 2005.</FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>(d)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Code of Ethics</FONT></P>
<P><FONT face="Times New Roman, Times, Serif" size=2>The Company has adopted a financial code of ethics that applies to our principal executive officer,
principal financial officer, principal accounting officer and all other employees of the Company
performing similar functions. This financial code of ethics is posted on our website. The Internet
address for the Company&#146;s website is http://www.siebertnet.com. The Company intends to satisfy
the disclosure requirement under Item 5.05 of Form 8-K regarding an amendment to, or waiver from,
a provision of this code of ethics by either filing a Form 8-K or posting such information on our
website, at the address and location specified above, within five business days following the date
of such amendment or waiver.</FONT></P>
<P><FONT face="Times New Roman, Times, Serif" size=2><B>ITEM 11. EXECUTIVE COMPENSATION </B></FONT></P>
<P><FONT face="Times New Roman, Times, Serif" size=2>The information required by this item is incorporated by reference from the Company&#146;s definitive


proxy statement to be filed by the Company pursuant to Regulation 14A on or prior to April 30,

2005.
</FONT></P>
<P align=center><FONT face="Times New Roman, Times, serif" size=2>- 22 -</FONT></P>
<HR noShade SIZE=5>

<P style="PAGE-BREAK-BEFORE: always">
<TABLE cellSpacing="0" cellPadding="0" width="100%" border="0">

<TR>
<TD vAlign=top width="10%"><FONT face="Times New Roman, Times, Serif" size=2><B>ITEM 12.</B></FONT></TD>
<TD vAlign=top width="3%">&nbsp;</TD>
<TD vAlign=top><FONT face="Times New Roman, Times, Serif" size=2><B>SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS </B></FONT></TD></TR></TABLE>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>The information required by this item is incorporated by reference from the Company&#146;s definitive


proxy statement to be filed by the Company pursuant to Regulation 14A on or prior to April 30,

2005.
</FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS </B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>The information required by this item is incorporated by reference from the Company&#146;s definitive


proxy statement to be filed by the Company pursuant to Regulation 14A on or prior to April 30,

2005.
</FONT></P><B></B>
<P align=center><FONT face="Times New Roman, Times, serif" size=2>- 23 -</FONT></P>
<HR noShade SIZE=5>

<P style="PAGE-BREAK-BEFORE: always">
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES</B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>The information required in this item is incorporated by reference from the Company&#146;s definitive
proxy statement to be filed by the Company pursuant to Regulation 14A on or prior to April 30, 2005.</FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>PART IV </B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES</B></FONT></P>
<TABLE cellSpacing="0" cellPadding="0" width="100%" border="0">

<TR>
<TD vAlign=top width=53>&nbsp;</TD>
<TD vAlign=top width=25>&nbsp;</TD>
<TD vAlign=top>
<P><FONT face="Times New Roman, Times, Serif" size=2>The exhibits required by Item 601 of the Regulations S-K filed as part of, or incorporated by reference
in, this report are listed in the accompanying Exhibit Index. </FONT></P></TD></TR></TABLE>
<TABLE cellSpacing="0" cellPadding="0" width="100%" border="0">

<TR>
<TD>&nbsp;</TD>
<TD></TD></TR>
<TR>
<TD vAlign=top width=53>&nbsp;</TD>
<TD vAlign=top><FONT face="Times New Roman, Times, serif" size=2>(a) The following documents are filed as part of this report: </FONT></TD></TR>
<TR>
<TD vAlign=top></TD>
<TD vAlign=top>&nbsp;</TD></TR></TABLE>
<TABLE cellSpacing="0" cellPadding="0" width="100%" border="0">

<TR>
<TD vAlign=top width=53>&nbsp;</TD>
<TD vAlign=top width=25><FONT face="Times New Roman, Times, serif" size=2>1.</FONT></TD>
<TD vAlign=top>
<P><FONT face="Times New Roman, Times, serif" size=2>Financial Statements </FONT></P></TD></TR>
<TR>
<TD vAlign=top>&nbsp;</TD>
<TD vAlign=top>&nbsp;</TD>
<TD vAlign=top align=left>&nbsp;</TD></TR>
<TR>
<TD vAlign=top>&nbsp;</TD>
<TD vAlign=top>&nbsp;</TD>
<TD vAlign=top align=left><FONT face="Times New Roman, Times, serif" size=2>The consolidated Financial statements for the year ended December 31, 2004 commence on page F-1 of
this report on Form 10-K. </FONT></TD></TR>
<TR>
<TD vAlign=top>&nbsp;</TD>
<TD vAlign=top>&nbsp;</TD>
<TD vAlign=top>&nbsp;</TD></TR>
<TR>
<TD vAlign=top>&nbsp;</TD>
<TD vAlign=top><FONT face="Times New Roman, Times, serif" size=2>2.</FONT></TD>
<TD vAlign=top><FONT face="Times New Roman, Times, serif" size=2>Financial Statement Schedules </FONT></TD></TR>
<TR>
<TD vAlign=top>&nbsp;</TD>
<TD vAlign=top><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD vAlign=top><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR>
<TD vAlign=top>&nbsp;</TD>
<TD vAlign=top><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD vAlign=top><FONT face="Times New Roman, Times, serif" size=2>None.</FONT></TD></TR>
<TR>
<TD vAlign=top>&nbsp;</TD>
<TD vAlign=top>&nbsp;</TD>
<TD vAlign=top>&nbsp;</TD></TR>
<TR>
<TD vAlign=top>&nbsp;</TD>
<TD vAlign=top><FONT face="Times New Roman, Times, Serif" size=2>3.</FONT></TD>
<TD vAlign=top><FONT face="Times New Roman, Times, Serif" size=2>Exhibits </FONT></TD></TR></TABLE>
<P align=center><FONT face="Times New Roman, Times, serif" size=2>- 24 -</FONT></P>
<HR noShade SIZE=5>

<P style="PAGE-BREAK-BEFORE: always">
<TABLE cellSpacing="0" cellPadding="0" width="100%" border="0">

<TR>
<TD vAlign=top align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2><B>INDEX TO CONSOLIDATED FINANCIAL STATEMENTS</B></FONT></TD></TR></TABLE><BR>
<TABLE cellSpacing="0" cellPadding="0" width="600" border="0">

<TR vAlign=bottom>
<TD align=left width="89%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="5%"><FONT face="Times New Roman, Times, Serif" size=2><B>PAGE</B></FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2><B>SIEBERT FINANCIAL CORP.</B></FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><A href="#a1"><FONT face="Times New Roman, Times, Serif" size=2>Report of Independent Registered Public Accounting Firm</FONT></A></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>F-1</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2><A href="#a2">Consolidated Statements of Financial Condition at December 31, 2004 and 2003</A></FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>F-2</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2><A href="#a3">Consolidated Statements of Operations for each of the years in the three-year period</A></FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2><A href="#a3">ended December 31, 2004</A></FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>F-3</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2><A href="#a4">Consolidated Statements of Changes in Stockholders&#146; Equity for each of the years</A></FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2><A href="#a4">in the three-year period ended December 31, 2004</A></FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>F-4</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2><A href="#a5">Consolidated Statements of Cash Flows for each of the years in the three-year</A></FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2><A href="#a5">period ended December 31, 2004</A></FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>F-5</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2><A href="#a6">Notes to Consolidated Financial Statements</A></FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>F-6</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>SIEBERT, BRANDFORD, SHANK &amp; CO., LLC</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2><A href="#a8">Independent Auditors&#146; Report</A></FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>F-18</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2><A href="#a9">Statements of Financial Condition at December 31, 2004 and 2003</A></FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>F-19</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2><A href="#a10">Statements of Operations for each of the years in the three-year</A></FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2><A href="#a10">period ended December 31, 2004</A></FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>F-20</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2><A href="#a11">Statements of Changes in Members&#146; Capital for each of the years</A></FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2><A href="#a11">in the three-year period ended December 31, 2004</A></FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>F-21</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2><A href="#a12">Statements of Cash Flows for each of the years in the three-year</A></FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2><A href="#a12">period ended December 31, 2004</A></FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>F-22</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2><A href="#a13">Notes to Financial Statements</A></FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>F-23</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR></TABLE>
<P align=center><FONT face="Times New Roman, Times, serif" size=2></FONT></P>
<HR noShade SIZE=5>

<P style="PAGE-BREAK-BEFORE: always">
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><STRONG><A name=a1></A>REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM</STRONG></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Board of Directors and Stockholders<BR>Siebert Financial Corp,</FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>We have audited the accompanying consolidated statements of financial condition of Siebert Financial
Corp. and its wholly subsidiaries (the &#147;Company&#148;) as of December 31, 2004 and 2003, and
the related consolidated statements of operations, changes in stockholders&#146; equity and cash
flows for each of the years in the three-year period ended December 31, 2004.&nbsp; These consolidated
financial statements are the responsibility&nbsp; of the Company&#146;s management. Our responsibility
is to express an opinion on these consolidated&nbsp; financial statements based on our audits. <BR><BR>We conducted our audits in accordance with the standards of the Public Company Accounting Oversight
Board (United States).&nbsp; Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material misstatement.&nbsp;
An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements.&nbsp;An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.<BR><BR>
In our opinion, the financial statements referred to above present fairly, in all material respects,
the consolidated financial position of Siebert Financial Corp. and its wholly owned subsidiaries
as of December 31, 2004 and 2003, and the consolidated results of their operations and their consolidated
cash flows for each of the years in the three-year period ended December 31, 2004 in conformity
with U.S. generally accepted accounting principles.</FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><BR>Eisner LLP</FONT></P>
<P align=left><FONT face="Times New Roman, Times, serif" size=2>New York, New York<BR>March 22, 2005<BR><BR>With respect to Note B <BR>March 29, 2005</FONT></P>
<P align=center><FONT face="Times New Roman, Times, serif" size=2>F-1</FONT></P>
<HR noShade SIZE=5>

<P style="PAGE-BREAK-BEFORE: always">
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B><A name=a2></A>SIEBERT FINANCIAL CORP. AND SUBSIDIARIES </B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION</FONT></P>
<TABLE cellSpacing="0" cellPadding="0" width="600" border="0">

<TR vAlign=bottom>
<TH colSpan=2>&nbsp;</TH>
<TH colSpan=5><FONT face="Times New Roman, Times, serif" size=1>DECEMBER 31,</FONT></TH>
<TH>&nbsp;</TH></TR>
<TR vAlign=bottom>
<TH colSpan=2>&nbsp;</TH>
<TH colSpan=5>
<HR noShade SIZE=1>
</TH>
<TH>&nbsp;</TH></TR>
<TR vAlign=bottom>
<TH colSpan=2><FONT face="Times New Roman, Times, Serif" size=1></FONT></TH>
<TH colSpan=2><FONT face="Times New Roman, Times, Serif" size=1>2004</FONT></TH>
<TH>&nbsp;</TH>
<TH colSpan=2><FONT face="Times New Roman, Times, Serif" size=1>2003</FONT></TH>
<TH>&nbsp;</TH></TR>
<TR vAlign=bottom>
<TD align=left width="71%">&nbsp;</TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>ASSETS</FONT></TD>
<TD align=left width="2%">&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left width="2%">&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left width="2%">&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Cash and cash equivalents</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right width="10%"><FONT face="Times New Roman, Times, Serif" size=2>28,748,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right width="10%"><FONT face="Times New Roman, Times, Serif" size=2>24,732,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Cash equivalents - restricted</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,300,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,300,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Receivable from clearing broker</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>2,371,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,487,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Advance to clearing broker</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,500,000</FONT></TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Securities owned, at market value</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,226,000</FONT></TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Furniture, equipment and leasehold improvements, net</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,305,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,863,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Investment in and advances to affiliate</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>3,779,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>3,212,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Prepaid expenses and other assets</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,539,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,807,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Intangibles, net</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>2,017,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>2,346,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Deferred taxes</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>501,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>553,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR>
<TD colSpan=2></TD>
<TD colSpan=3></TD>
<TD colSpan=3></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>41,560,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>40,026,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR>
<TD colSpan=2></TD>
<TD colSpan=3></TD>
<TD colSpan=3></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>LIABILITIES AND STOCKHOLDERS&#146; EQUITY</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Liabilities:</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Securities sold, not yet purchased, at market value</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>6,000</FONT></TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Accounts payable and accrued liabilities</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>6,460,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>4,885,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR>
<TD colSpan=2></TD>
<TD colSpan=3></TD>
<TD colSpan=3></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>6,460,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>4,891,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR>
<TD colSpan=2></TD>
<TD colSpan=3></TD>
<TD colSpan=3></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Commitments and contingent liabilities</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Stockholders&#146; equity:</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Common stock, $.01 par value; 49,000,000 shares authorized, 22,983,917 shares</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>issued and 22,082,301 outstanding at December 31, 2004 and 22,983,917 shares</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>issued and 22,222,014 shares outstanding at</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>December 31, 2003</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>229,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>229,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Additional paid-in capital</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>17,931,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>17,931,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Retained earnings</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>21,033,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>20,500,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Less: &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;901,616 at December 31, 2004 and 761,903 shares of treasury stock,</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>at December 31, 2003, at cost</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(4,093,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(3,525,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD></TR>
<TR>
<TD colSpan=2></TD>
<TD colSpan=3></TD>
<TD colSpan=3></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>35,100,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>35,135,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR>
<TD colSpan=2></TD>
<TD colSpan=3></TD>
<TD colSpan=3></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>41,560,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>40,026,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR></TABLE>
<P align=center><FONT face="Times New Roman, Times, Serif" size=2>See notes to consolidated financial statements.</FONT></P>
<P align=center><FONT face="Times New Roman, Times, serif" size=2>F-2</FONT></P>
<HR noShade SIZE=5>

<P style="PAGE-BREAK-BEFORE: always">
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B><A name=a3></A>CONSOLIDATED STATEMENTS OF OPERATIONS </B></FONT></P>
<TABLE cellSpacing="0" cellPadding="0" width="600" border="0">

<TR vAlign=bottom>
<TH colSpan=2>&nbsp;</TH>
<TH colSpan=8><FONT face="Times New Roman, Times, serif" size=1>YEAR ENDED DECEMBER 31,</FONT></TH>
<TH>&nbsp;</TH></TR>
<TR vAlign=bottom>
<TH colSpan=2><FONT face="Times New Roman, Times, Serif" size=1></FONT></TH>
<TH colSpan=2><FONT face="Times New Roman, Times, Serif" size=1>2004</FONT></TH>
<TH>&nbsp;</TH>
<TH colSpan=2><FONT face="Times New Roman, Times, Serif" size=1>2003</FONT></TH>
<TH>&nbsp;</TH>
<TH colSpan=2><FONT face="Times New Roman, Times, Serif" size=1>2002</FONT></TH>
<TH>&nbsp;</TH></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left width="59%"><FONT face="Times New Roman, Times, Serif" size=2>Revenue:</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="10%"><FONT face="Times New Roman, Times, Serif" size=2></FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="10%"><FONT face="Times New Roman, Times, Serif" size=2></FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="10%"><FONT face="Times New Roman, Times, Serif" size=2></FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Commissions and fees</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>23,798,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>20,456,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>19,366,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Investment banking</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,363,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,086,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,478,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Trading profits</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>761,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>804,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>850,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Income from equity investee</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,712,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,900,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,772,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Interest and dividends</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>470,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>450,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>638,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR>
<TD colSpan=2></TD>
<TD colSpan=3></TD>
<TD colSpan=3></TD>
<TD colSpan=3></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>28,104,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>24,696,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>24,104,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR>
<TD colSpan=2></TD>
<TD colSpan=3></TD>
<TD colSpan=3></TD>
<TD colSpan=3></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Expenses:</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Employee compensation and benefits</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>11,138,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>8,722,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>9,181,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Clearing fees, including floor brokerage</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>4,242,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>4,271,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>3,701,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Advertising and promotion</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,107,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,358,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>2,900,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Communications</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>2,331,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>2,838,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>2,311,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Occupancy</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,067,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,123,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>924,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Interest</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>28,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Write off of advance to clearing broker </FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,500,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Other general and administrative</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>5,708,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>6,190,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>8,304,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR>
<TD colSpan=2></TD>
<TD colSpan=3></TD>
<TD colSpan=3></TD>
<TD colSpan=3></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>27,121,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>24,503,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>27,322,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR>
<TD colSpan=2></TD>
<TD colSpan=3></TD>
<TD colSpan=3></TD>
<TD colSpan=3></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Income (loss) before provision (benefit) for income taxes</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>983,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>193,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(3,218,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Provision (benefit) for income taxes</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>450,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>70,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(1,585,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD></TR>
<TR>
<TD colSpan=2></TD>
<TD colSpan=3></TD>
<TD colSpan=3></TD>
<TD colSpan=3></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Net income (loss)</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>533,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>123,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(1,633,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD></TR>
<TR>
<TD colSpan=2></TD>
<TD colSpan=3></TD>
<TD colSpan=3></TD>
<TD colSpan=3></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Net income (loss) per share of common stock - basic</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>0.02</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>0.01</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(0.07</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Net income (loss) per share of common stock - diluted</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>0.02</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>0.01</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(0.07</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD></TR>
<TR>
<TD colSpan=2></TD>
<TD colSpan=3></TD>
<TD colSpan=3></TD>
<TD colSpan=3></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Weighted average shares outstanding - basic</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>22,113,228</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>22,305,369</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>22,403,990</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Weighted average shares outstanding - diluted</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>22,276,562</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>22,453,538</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>22,403,990</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR></TABLE>
<P align=center><FONT face="Times New Roman, Times, Serif" size=2>See notes to consolidated financial statements.</FONT></P>
<P align=center><FONT face="Times New Roman, Times, serif" size=2>F-3</FONT></P>
<HR noShade SIZE=5>

<P style="PAGE-BREAK-BEFORE: always">
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B><A name=a4></A>CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS&#146; EQUITY </B></FONT></P>
<TABLE cellSpacing="0" cellPadding="0" width="600" border="0">

<TR vAlign=bottom>
<TH colSpan=2><FONT face="Times New Roman, Times, Serif" size=1></FONT></TH>
<TH colSpan=11><FONT face="Times New Roman, Times, Serif" size=1></FONT><FONT face="Times New Roman, Times, Serif" size=1>COMMON STOCK</FONT><FONT face="Times New Roman, Times, Serif" size=1></FONT><FONT face="Times New Roman, Times, Serif" size=1></FONT></TH>
<TH>&nbsp;</TH></TR>
<TR vAlign=bottom>
<TH colSpan=2>&nbsp;</TH>
<TH colSpan=11>
<HR noShade SIZE=1>
</TH>
<TH>&nbsp;</TH></TR>
<TR vAlign=bottom>
<TH colSpan=2><FONT face="Times New Roman, Times, Serif" size=1></FONT></TH>
<TH colSpan=2><FONT face="Times New Roman, Times, Serif" size=1>NUMBER<BR>OF<BR>SHARES</FONT></TH>
<TH>&nbsp;</TH>
<TH colSpan=2><FONT face="Times New Roman, Times, Serif" size=1>$.01 PAR<BR>VALUE</FONT></TH>
<TH>&nbsp;</TH>
<TH colSpan=2><FONT face="Times New Roman, Times, Serif" size=1>ADDITIONAL<BR>PAID -IN<BR>CAPITAL </FONT></TH>
<TH>&nbsp;</TH>
<TH colSpan=2><FONT face="Times New Roman, Times, Serif" size=1>RETAINED<BR>EARNINGS </FONT></TH>
<TH>&nbsp;</TH></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left width="46%"><FONT face="Times New Roman, Times, serif" size=2>BALANCE - JANUARY 1, 2002</FONT></TD>
<TD align=left width="1%"><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="10%"><FONT face="Times New Roman, Times, serif" size=2>22,932,047</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, serif" size=2>$</FONT></TD>
<TD align=right width="10%"><FONT face="Times New Roman, Times, serif" size=2>229,000</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, serif" size=2>$</FONT></TD>
<TD align=right width="10%"><FONT face="Times New Roman, Times, serif" size=2>17,796,000</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, serif" size=2>$</FONT></TD>
<TD align=right width="10%"><FONT face="Times New Roman, Times, serif" size=2>22,010,000</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>Net loss</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>(1,633,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>)</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>Treasury share purchases</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>Issuance of shares in connection with</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>exercise of employee stock options</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>36,120</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>84,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&#151;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>BALANCE - DECEMBER 31, 2002</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>22,968,167</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>229,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>17,880,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>20,377,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>Net income</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>123,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>Treasury share purchases</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>Issuance of shares in connection with</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>exercise of employee stock options</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>15,750</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>36,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>Tax benefit arising from exercise of employees</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>stock option</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>15,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>BALANCE - DECEMBER 31, 2003</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>22,983,917</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>229,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>17,931,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>20,500,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>Net income</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>533,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>Treasury share purchases</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right>
<HR noShade SIZE=1>
</TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right>
<HR noShade SIZE=1>
</TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right>
<HR noShade SIZE=1>
</TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>BALANCE - DECEMBER 31, 2004</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>22,983,917</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>229,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>17,931,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>21,033,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left colSpan=6><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right colSpan=2><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right colSpan=2><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align="CENTER" colSpan=13><FONT face="Times New Roman, Times, serif" size=2>(Table Continued)</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR></TABLE><BR>
<TABLE cellSpacing="0" cellPadding="0" width="600" border="0">

<TR vAlign=bottom>
<TH colSpan=2><FONT face="Times New Roman, Times, Serif" size=1></FONT></TH>
<TH colSpan=8><FONT face="Times New Roman, Times, Serif" size=1>TREASURY STOCK</FONT><FONT face="Times New Roman, Times, Serif" size=1></FONT><FONT face="Times New Roman, Times, Serif" size=1></FONT></TH>
<TH>&nbsp;</TH></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=8>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TH colSpan=2><FONT face="Times New Roman, Times, Serif" size=1></FONT></TH>
<TH colSpan=2><FONT face="Times New Roman, Times, Serif" size=1>NUMBER<BR>OF<BR>SHARES</FONT></TH>
<TH>&nbsp;</TH>
<TH colSpan=2><FONT face="Times New Roman, Times, Serif" size=1>AMOUNT</FONT></TH>
<TH>&nbsp;</TH>
<TH colSpan=2><FONT face="Times New Roman, Times, Serif" size=1>TOTAL</FONT></TH>
<TH>&nbsp;</TH></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left width="52%"><FONT face="Times New Roman, Times, serif" size=2>BALANCE - JANUARY 1, 2002</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="11%"><FONT face="Times New Roman, Times, serif" size=2>542,800</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, serif" size=2>$</FONT></TD>
<TD align=right width="11%"><FONT face="Times New Roman, Times, serif" size=2>(2,735,000</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, serif" size=2>)</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, serif" size=2>$</FONT></TD>
<TD align=right width="11%"><FONT face="Times New Roman, Times, serif" size=2>37,300,000</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>Net loss</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>(1,633,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>)</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>Treasury share purchases</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>29,600</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>(84,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>(84,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>)</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>Non-cash compensation in connection with</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>Issuance of shares in connection with exercise</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>of employee stock options</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>84,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>BALANCE - DECEMBER 31, 2002</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>572,400</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>(2,819,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>35,667,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>Net income</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>123,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>Treasury share purchases</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>189,503</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>(706,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>(706,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>)</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>Issuance of shares in connection with</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>exercise of employee stock options</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>36,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>Tax benefit arising from exercise of employees</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>stock options</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>15,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>BALANCE - DECEMBER 31, 2003</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>761,903</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>(3,525,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>35,135,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>Net income</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>533,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>Treasury share purchases</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>139,713</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>(568,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>(568,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>)</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>BALANCE - DECEMBER 31, 2004</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>901,616</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>(4,093,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>35,100,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR></TABLE>
<P align=center><FONT face="Times New Roman, Times, Serif" size=2>See notes to consolidated financial statements.</FONT></P>
<P align=center><FONT face="Times New Roman, Times, serif" size=2>F-4</FONT></P>
<HR noShade SIZE=5>

<P style="PAGE-BREAK-BEFORE: always">
<P align=center><FONT face="Times New Roman, Times, Serif" size=2><B><U><A name=a5></A>CONSOLIDATED STATEMENTS OF CASH FLOWS</U></B></FONT></P>
<P align=center><FONT face="Times New Roman, Times, Serif" size=2><B><U>YEAR ENDED DECEMBER 31,</U></B></FONT></P>
<TABLE cellSpacing="0" cellPadding="0" width=760 border="0">

<TR vAlign=bottom>
<TH colSpan=2><FONT face="Times New Roman, Times, Serif" size=1></FONT></TH>
<TH colSpan=2><FONT face="Times New Roman, Times, Serif" size=1>2004</FONT></TH>
<TH>&nbsp;</TH>
<TH colSpan=2><FONT face="Times New Roman, Times, Serif" size=1>2003</FONT></TH>
<TH>&nbsp;</TH>
<TH colSpan=2><FONT face="Times New Roman, Times, Serif" size=1>2002</FONT></TH>
<TH>&nbsp;</TH></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>CASH FLOWS FROM OPERATING ACTIVITIES:</FONT></TD>
<TD align=left width="1%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="9%"><FONT face="Times New Roman, Times, Serif" size=2></FONT></TD>
<TD align=left width="3%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="9%"><FONT face="Times New Roman, Times, Serif" size=2></FONT></TD>
<TD align=left width="3%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="9%"><FONT face="Times New Roman, Times, Serif" size=2></FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Net income (loss)</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>533,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>123,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(1,633,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Adjustments to reconcile net income (loss) to net cash provided by (used in)</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;operating activities:</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Depreciation and amortization</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,464,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,778,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,718,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Income from equity investee</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(1,712,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(1,900,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(1,772,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Tax benefit of exercised employee stock options</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>15,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Deferred taxes</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>52,000</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>293,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(1,335,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Write-off of advance&nbsp;to clearing broker</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,500,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Changes in:</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Securities owned, at market value</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,226,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>3,999,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>854,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Receivable from clearing broker</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(884,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(387,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>472,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Prepaid expenses and other</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;assets</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>268,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>9,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(963,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Securities sold, not yet</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;purchased, at market
value</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(6,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>6,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(4,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts payable and accrued liabilities</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,575,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>101,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>448,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net cash provided by
(used in) operating activities</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>4,016,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>4,037,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(2,215,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><B><FONT face="Times New Roman, Times, Serif" size=2>CASH FLOWS FROM INVESTING ACTIVITIES:</FONT></B></TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Purchase of intangibles</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(400,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(1,150,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(1,045,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Return of deposit on equipment</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>241,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Advance to clearing broker</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right>&nbsp;</TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(1,500,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Purchase of furniture, equipment and leasehold improvements</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(177,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(160,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(1,638,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>(Payment) collection of advances made to equity investee</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(86,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(7,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>43,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Distribution from equity investee</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,231,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,443,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,683,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net
cash provided (used in) by investing activities</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>568,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(1,133,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(957,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><B><FONT face="Times New Roman, Times, Serif" size=2>CASH FLOWS FROM FINANCING ACTIVITIES:</FONT></B></TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Purchase of treasury shares</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(568,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(706,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(84,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Proceeds from exercise of options</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>0</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>36,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>84,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net
cash used in financing activities</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(568,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(670,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>0</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Net increase (decrease) in cash and cash equivalents</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>4,016,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>2,234,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(3,172,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Cash and cash equivalents - beginning of year</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>24,732,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>22,498,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>25,670,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Cash and cash equivalents - end of year</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>28,748,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>24,732,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>22,498,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><B><FONT face="Times New Roman, Times, Serif" size=2>SUPPLEMENTAL CASH FLOW DISCLOSURES:</FONT></B></TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;Cash paid for:</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Interest</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>28,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Income taxes</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>741,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>61,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>279,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>NONCASH INVESTING AND FINANCING ACTIVITIES:</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Tax benefit of employee stock options</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>15,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR></TABLE>
<P align=center><FONT face="Times New Roman, Times, Serif" size=2>See notes to consolidated financial statements.</FONT></P>
<P align=center><FONT face="Times New Roman, Times, serif" size=2>F-5</FONT></P>
<HR noShade SIZE=5>

<P style="PAGE-BREAK-BEFORE: always">
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B><A name=a6></A>SIEBERT FINANCIAL CORP. AND SUBSIDIARIES <BR></B></FONT><FONT face="Times New Roman, Times, Serif" size=2><B>NOTES TO CONSOLIDATED FINANCIAL STATEMENTS </B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>NOTE A - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES </B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>[1]&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ORGANIZATION
AND BASIS OF PRESENTATION:</FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Siebert Financial Corp. (&#147;Financial&#148;), through its wholly owned subsidiary, Muriel Siebert
&amp; Co., Inc. (&#147;Siebert&#148;), engages in the business of providing discount brokerage services
for customers, investment banking services for institutional clients and trading securities for its
own account, and, through its wholly owned subsidiary, Siebert Women&#146;s Financial Network, Inc.
(&#147;WFN&#148;), engages in providing products, services and information all uniquely devoted to
women&#146;s financial needs. All significant intercompany accounts and transactions have been eliminated.
Financial, Siebert and WFN collectively are referred to herein as the &#147;Company&#148;.</FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>The municipal bond investment banking business is being conducted by Siebert Brandford Shank &amp;
Co., LLC (&#147;SBS&#148;), an investee, which is accounted for by the equity method of accounting
(see Note C). The equity method provides that Siebert record its share of SBS&#146;s earnings or
losses.</FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>[2]&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; SECURITIES
TRANSACTIONS:</FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Securities transactions, commissions, revenues and expenses are recorded on a trade date basis.</FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Siebert cleared all its security transactions through two unaffiliated clearing firms on a fully disclosed
basis. Accordingly, Siebert does not hold funds or securities for or owe funds or securities to its
customers. Those functions are performed by the clearing firms, which are highly capitalized. Marketable
securities are valued at market value.</FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>[3]&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; INCOME TAXES:</FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>The Company accounts for income taxes utilizing the asset and liability approach requiring the recognition
of deferred tax assets and liabilities for the expected future tax consequences of temporary differences
between the basis of assets and liabilities for financial reporting purposes and tax purposes. Financial
files a consolidated federal income tax return, which includes Siebert and WFN.</FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>[4]&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;FURNITURE,
EQUIPMENT AND LEASEHOLD IMPROVEMENTS:</FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Property and equipment is stated at cost and depreciation is calculated using the straight-line method
over the lives of the assets, generally five years. Leasehold improvements are amortized over the
shorter of the estimated useful life or period of the lease.</FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>[5]&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; CASH EQUIVALENTS:</FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>For purposes of reporting cash flows, cash equivalents include money market funds.</FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>[6]&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; ADVERTISING
COSTS:</FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Advertising costs are charged to expense as incurred.</FONT></P>
<P align=center><FONT face="Times New Roman, Times, serif" size=2>F-6</FONT></P>
<HR noShade SIZE=5>

<P style="PAGE-BREAK-BEFORE: always">
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>NOTE A - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) </B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>[7]&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; USE OF ESTIMATES:</FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>The preparation of financial statements in conformity with accounting principles generally accepted
in the United States of America requires management to make estimates and assumptions that affect
the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities
at the date of the financial statements and the reported amounts of revenues and expenses during
the reporting period. Actual results could differ from those estimates.</FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>[8]&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; EARNINGS PER SHARE:</FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Basic earnings (loss) per share is calculated by dividing net income (loss) by the weighted average
outstanding shares during the period. Diluted earnings (loss) per share is calculated by dividing
net income (loss) by the number of shares outstanding under the basic calculation and adding all
dilutive securities, which consist of options. The treasury stock method is used to reflect the dilutive
effect of outstanding options, which, for 2004 and 2003 amounted to 163,334 and 148,169 additional
shares, respectively, added to the basic weighted average outstanding shares of 22,113,228 and 22,305,369
in 2004 and 2003, respectively. The Company recognized a net loss for the year ended December 31,
2002. Accordingly, basic and diluted loss per common share are the same as the effect of dilutive
securities would be anti-dilutive to loss per share. Potentially dilutive securities consisting of
outstanding options at December 31, 2004, 2003 and 2002 amounted to 1,888,350, 1,802,930 and 1,855,260,
respectively.</FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>[9]&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; INVESTMENT BANKING:</FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Investment banking revenue includes gains and fees, net of syndicate expenses, arising from underwriting
syndicates in which the Company participates. Investment banking management fees are recorded on
the offering date, sales concessions on the settlement date and underwriting fees at the time the
underwriting is completed and the income is reasonably determinable.</FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>[10]&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; CASH EQUIVALENTS - RESTRICTED:</FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Cash equivalents - restricted represents $1,300,000 of cash invested in a money market account which
Siebert is obligated to lend to SBS on a subordinated basis. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Any outstanding amounts under the note bear interest at 8% per annum and are repayable on August 31,
2006.</FONT></P>
<P align=center><FONT face="Times New Roman, Times, serif" size=2>F-7</FONT></P>
<HR noShade SIZE=5>

<P style="PAGE-BREAK-BEFORE: always">
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>NOTE A - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) </B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>[11]&nbsp;&nbsp; STOCK-BASED COMPENSATION: </B></FONT></P>
<TABLE cellSpacing="0" cellPadding="0" width="100%" border="0">

<TR>
<TD vAlign=top width=48>&nbsp;</TD>
<TD vAlign=top><FONT face="Times New Roman, Times, Serif" size=2>Statement of Financial Accounting Standards (&#147;SFAS&#148;) No. 123, Accounting for Stock-Based
Compensation (&#147;SFAS 123&#148;) as amended by SFAS No. 148, (Accounting for Stock-Based Compensation
&#150; Transition and Disclosure an amendment to SFAS 123), allows the fair value of stock-based
compensation to be included in expense over the period earned; alternatively, if the fair value of
stock-based compensation awards are not included in expense, SFAS 123 requires disclosure of net
income (loss), on a pro forma basis, as if expense treatment had been applied. As permitted by SFAS
123, the Company continues to account for such compensation under Accounting Principles Board Opinion
No. 25 (&#147;APB 25&#148;), Accounting for Stock Issued to Employees, and related interpretations,
pursuant to which no compensation cost was recognized in connection with the issuance of stock options,
as all options granted under the 1997 Stock Option Plan had an exercise price equal to or greater
than the fair value of the underlying common stock on the date of grant. Had the Company elected
to recognize compensation expense for the stock option plan, consistent with the method prescribed
by SFAS 123, the Company&#146;s net income (loss) and income (loss) per share for the years ended
December 31, 2004, 2003 and 2002 would have decreased (increased) to the pro forma amounts as follows: </FONT></TD></TR></TABLE><BR>
<TABLE cellSpacing="0" cellPadding="0" width=760 border="0">

<TR vAlign=bottom>
<TH colSpan=2><FONT face="Times New Roman, Times, Serif" size=1></FONT></TH>
<TH colSpan=8><FONT face="Times New Roman, Times, Serif" size=1>YEAR ENDED DECEMBER 31,</FONT><FONT face="Times New Roman, Times, Serif" size=1></FONT><FONT face="Times New Roman, Times, Serif" size=1></FONT></TH>
<TH>&nbsp;</TH></TR>
<TR vAlign=bottom>
<TD align=left colSpan=2>&nbsp;</TD>
<TD align=right colSpan=8>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TH colSpan=2><FONT face="Times New Roman, Times, Serif" size=1></FONT></TH>
<TH colSpan=2><FONT face="Times New Roman, Times, Serif" size=1>2004</FONT></TH>
<TH>&nbsp;</TH>
<TH colSpan=2><FONT face="Times New Roman, Times, Serif" size=1>2003</FONT></TH>
<TH>&nbsp;</TH>
<TH colSpan=2><FONT face="Times New Roman, Times, Serif" size=1>2002</FONT></TH>
<TH>&nbsp;</TH></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Net income (loss), as reported</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right width="10%"><FONT face="Times New Roman, Times, Serif" size=2>533,000</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right width="10%"><FONT face="Times New Roman, Times, Serif" size=2>123,000</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right width="10%"><FONT face="Times New Roman, Times, Serif" size=2>(1,633,000</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Stock-based employee compensation determined</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;under APB 25</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Stock-based employee compensation determined</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;under the fair value based method,
net of tax effect</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(332,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(759,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(1,647,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Pro forma net (loss) income</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>201,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(636,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(3,280,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Net (loss) income per share - basic:</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As reported</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>.02</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>.01</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(.07</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pro forma</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>.01</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(.03</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(.15</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Net (loss) income per share - diluted:</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As reported</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>.02</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>.01</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(.07</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pro forma</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>.01</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(.03</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(.15</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left colSpan=2><FONT face="Times New Roman, Times, serif" size=2>The weighted average fair value of stock options is estimated at the<BR>grant date using the Black-Scholes option pricing model with the<BR>following weighted average assumptions:</FONT></TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR></TABLE><BR>
<TABLE cellSpacing="0" cellPadding="0" width=760 border="0">

<TR vAlign=bottom>
<TH colSpan=2><FONT face="Times New Roman, Times, Serif" size=1></FONT></TH>
<TH colSpan=2><FONT face="Times New Roman, Times, Serif" size=1>2004</FONT></TH>
<TH>&nbsp;</TH>
<TH colSpan=2><FONT face="Times New Roman, Times, Serif" size=1>2003</FONT></TH>
<TH>&nbsp;</TH>
<TH colSpan=2><FONT face="Times New Roman, Times, Serif" size=1>2002</FONT></TH>
<TH>&nbsp;</TH></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Risk free interest rate</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="10%"><FONT face="Times New Roman, Times, Serif" size=2>3.71</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>%</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="10%"><FONT face="Times New Roman, Times, Serif" size=2>4.00</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>%</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="10%"><FONT face="Times New Roman, Times, Serif" size=2>4.00</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>%</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Expected life of options in years</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>7.78</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>10.00</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>10.00</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Expected dividend yield</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>0.00</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>%</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>0.00</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>%</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>0.00</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>%</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Expected volatility</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>52.00</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>%</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>72.00</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>%</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>82.00</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>%</FONT></TD></TR>
<TR>
<TD colSpan=2></TD>
<TD colSpan=3></TD>
<TD colSpan=3></TD>
<TD colSpan=3></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Weighted average fair value</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>3.01</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>3.09</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>3.50</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR></TABLE>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>[12]&nbsp;&nbsp; START-UP COSTS: </B></FONT></P>
<TABLE cellSpacing="0" cellPadding="0" width="100%" border="0">

<TR>
<TD vAlign=top width=48>&nbsp;</TD>
<TD vAlign=top><FONT face="Times New Roman, Times, Serif" size=2>Start-up costs consist principally of advisory and legal fees and costs relating to the development
and marketing of a joint brokerage service with Intuit, Inc. (the &#147;JBS&#148;). In accordance
with the American Institute of Certified Public Accountants&#146; Statement of Position (&#147;SOP&#148;)
98-5, start-up costs were expensed as incurred in 2002. Siebert separately incurred other start-up
costs for an advisory fee of $1,000,000 and legal fees of $392,000. </FONT></TD></TR></TABLE>
<P align=center><FONT face="Times New Roman, Times, serif" size=2>F-8</FONT></P>
<HR noShade SIZE=5>

<P style="PAGE-BREAK-BEFORE: always">
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>NOTE A - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) </B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>[13]&nbsp;&nbsp; INTANGIBLES: </B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Purchased intangibles are principally being amortized using the straight-line method over an estimated
useful life of three to five years. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>[14]&nbsp;&nbsp; VALUATION OF LONG-LIVED ASSETS: </B></FONT></P>
<TABLE cellSpacing="0" cellPadding="0" width="100%" border="0">

<TR>
<TD vAlign=top><FONT face="Times New Roman, Times, Serif" size=2>The Company evaluates the recoverability of its long-lived assets and requires the recognition of impairment
of long-lived assets in the event the net book value of these assets exceeds the estimated future
undiscounted cash flows attributable to these assets. The Company assesses potential impairment to
its long-lived assets when there is evidence that events or changes in circumstances have made recovery
of the assets&#146; carrying value unlikely. Should impairment exist, the impairment loss would be
measured based on the excess of the carrying value of the assets over the assets&#146; fair value. </FONT></TD></TR></TABLE>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>[15]&nbsp;&nbsp; NEW ACCOUNTING STANDARDS: </B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>In December 2004, the FASB issued SFAS No. 123 (revised 2004), Share-Based Payment (&#147;FAS 123R&#148;),
which replaces FAS 123 and supercedes APB No.25. FAS 123R requires all share-based payments to employees,
including grants of employee stock options, to be recognized in the financial statements based on
their fair values beginning with the first interim or annual period after June 15, 2005, with early
adoption encouraged. The pro forma disclosures previously permitted under FAS 123 no longer will
be an alternative to financial statement recognition. We are required to adopt FAS 123R beginning
July 1, 2005. Under FAS 123R, we must determine the appropriate fair value model to be used for valuing
share-based payments, the amortization method for compensation cost and the transition method to
be used at date of adoption. The transition methods include prospective and retroactive adoption
options. We are evaluating the requirements of FAS 123R and expect that the adoption of FAS 123R
will have a material impact on our consolidated results of operations and earnings per share. We
have not yet determined the method of adoption or the effect of adopting&nbsp;FAS 123R,&nbsp;and
we have not determined whether the adoption will result in amounts that are similar to the current
pro forma disclosure under FAS123.&nbsp; We have not yet determined the impact of FAS 123R on our
compensation policies or plans, if any.</FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>In December 2004, the FASB issued SFAS No. 153, Exchange of Nonmonetary Assets, an amendment of APB
No. 29, Accounting for Nonmonetary Transactions (&#147;FAS 153&#148;). FAS 153 amends APB No. 29
to eliminate the exception for nonmonetary exchanges of similar productive assets and replaces it
with a general exception for exchanges of nonmonetary assets that do not have commercial substance.
A nonmonetary exchange has commercial substance if the future cash flows of the entity are expected
to change significantly as a result of the exchange. We are required to adopt FAS 153, on a prospective
basis, for nonmonetary exchanges beginning after June 15, 2005. We have not yet determined if FAS
No. 153 will have an impact on our results of operation or financial position.</FONT></P>
<P align=left><FONT face="Times New Roman, Times, serif" size=2></FONT></P>
<P align=center><FONT face="Times New Roman, Times, serif" size=2>F-9</FONT></P>
<HR noShade SIZE=5>

<P style="PAGE-BREAK-BEFORE: always">
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>NOTE B &#150; INTUIT LAWSUIT UPDATE: </B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Siebert filed a lawsuit against Intuit, Inc. (&#147;Intuit&#148;), in New York State Supreme Court


on September 17, 2003 (the &#147;Intuit Lawsuit&#148;), seeking not less than $11.1 million in

compensatory
damages and $33.3 million in punitive damages for claims relating to the Joint Brokerage

Service
(the &#147;JBS&#148;) conducted during the years ended December 31, 2003 and 2002 under

the Strategic
Alliance Agreement between Siebert and Intuit. A motion by Intuit to stay the lawsuit

and require
that the dispute be submitted to arbitration was denied in a decision of the Supreme

Court dated
January 7, 2004. Intuit&#146;s motion to reargue the Court&#146;s decision was denied

by the Court
in a decision dated June 7, 2004. Intuit appealed both decisions to the Appellate

Division of the
Supreme Court. By a unanimous decision and order dated October 28, 2004, the
Appellate
Division affirmed
the lower Court&#146;s January 7, 2004 decision, denying Intuit&#146;s
motion
to compel arbitration
and stay litigation. By further order of the Appellate Division
dated January
4, 2005, Intuit&#146;s
motion for reargument or for leave to appeal to the Court
of Appeals was
denied. On February 7, 2005,
Intuit made a motion directly to the Court of Appeals
for leave to
appeal to that Court from the
Appellate Division&#146;s order of October 28, 2004.
Intuit&#146;s
motion and Siebert&#146;s answering
papers were submitted to the Court of Appeals
for decision
on February 22, 2005. By a decision announced
on March 29, 2005, the court of Appeals
denied Intuit&#146;s
motion for leave to appeal, thereby
ending any controversy over Siebert&#146;s
right to litigate
in court rather than arbitrate. </FONT><FONT face="Times New Roman, Times, Serif" size=2>In addition, Intuit has also moved in the Supreme Court, on February 4, 2005, to dismiss five of the


six causes of action asserted by Siebert in the Intuit Lawsuit. </FONT><FONT face="Times New Roman, Times, Serif" size=2>Siebert&#146;s answering papers and Intuit&#146;s reply papers on that motion are scheduled to be submitted


to the Supreme Court on April 11, 2005. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>NOTE C - INVESTMENT IN AFFILIATE </B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>In March 1997, Siebert and two individuals (the &#147;Principals&#148;) formed SBS to succeed to the
tax-exempt underwriting business of the Siebert Brandford Shank division of Siebert. The agreements
with the Principals provide that profits will be shared 51% to the Principals and 49% to Siebert.
Siebert invested $392,000 as its share of the members&#146; capital of SBS. SBS commenced operations
on July 1, 1998. </FONT></P>
<P align=center><FONT face="Times New Roman, Times, serif" size=2>F-10</FONT></P>
<HR noShade SIZE=5>

<P style="PAGE-BREAK-BEFORE: always">
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>NOTE C - INVESTMENT IN AFFILIATE (CONTINUED) </B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Summarized financial data of SBS is as follows: </FONT></P>
<TABLE cellSpacing="0" cellPadding="0" width="600" border="0">

<TR vAlign=bottom>
<TH colSpan=2><FONT face="Times New Roman, Times, Serif" size=1></FONT></TH>
<TH colSpan=2><FONT face="Times New Roman, Times, Serif" size=1>2004</FONT></TH>
<TH>&nbsp;</TH>
<TH colSpan=2><FONT face="Times New Roman, Times, Serif" size=1>2003</FONT></TH>
<TH>&nbsp;</TH>
<TH colSpan=2><FONT face="Times New Roman, Times, Serif" size=1>2002</FONT></TH>
<TH>&nbsp;</TH></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Total assets</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right width="10%"><FONT face="Times New Roman, Times, Serif" size=2>12,326,000</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right width="10%"><FONT face="Times New Roman, Times, Serif" size=2>10,173,000</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right width="10%"><FONT face="Times New Roman, Times, Serif" size=2>8,944,000</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Total liabilities including subordinated liabilities </FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;$1,200,000, $1,200,000 and $1,200,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>4,882,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>3,710,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>3,403,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Total members&#146; capital</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>7,444,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>6,463,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>5,541,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Total revenue</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>17,222,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>14,628,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>13,190,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Net income</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>3,494,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>3,878,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>3,616,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Regulatory minimum net capital requirement</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>245,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>168,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>130,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR></TABLE>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>The amounts above are unconsolidated and recorded on a gross basis. During each of 2004, 2003 and 2002
Siebert charged SBS $240,000 for rent and general and administrative services, which Siebert believes
approximates the cost of furnishing such services. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Siebert&#146;s share of undistributed earnings from SBS amounts to $3,256,000 and $2,775,000 at December
31, 2004 and 2003, respectively. Such amounts may not be immediately available for distribution to
Siebert for various reasons including the amount of SBS&#146;s available cash, the provisions of
the agreement between Siebert and the Principals and SBS&#146;s continued compliance with its regulatory
net capital requirements. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>NOTE D - FURNITURE, EQUIPMENT AND LEASEHOLD IMPROVEMENTS, NET </B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Furniture, equipment and leasehold improvements consist of the following: </FONT></P>
<TABLE cellSpacing="0" cellPadding="0" width="600" border="0">

<TR vAlign=bottom>
<TH colSpan=2><FONT face="Times New Roman, Times, Serif" size=1></FONT></TH>
<TH colSpan=5><FONT face="Times New Roman, Times, Serif" size=1>DECEMBER 31,</FONT><FONT face="Times New Roman, Times, Serif" size=1></FONT></TH>
<TH>&nbsp;</TH></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=5>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TH colSpan=2><FONT face="Times New Roman, Times, Serif" size=1></FONT></TH>
<TH colSpan=2><FONT face="Times New Roman, Times, Serif" size=1>2004</FONT></TH>
<TH>&nbsp;</TH>
<TH colSpan=2><FONT face="Times New Roman, Times, Serif" size=1>2003</FONT></TH>
<TH>&nbsp;</TH></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left width="62%"><FONT face="Times New Roman, Times, Serif" size=2>Equipment</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right width="13%"><FONT face="Times New Roman, Times, Serif" size=2>3,071,000</FONT></TD>
<TD align=left width="5%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right width="13%"><FONT face="Times New Roman, Times, Serif" size=2>3,258,000</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Leasehold improvements</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>533,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>496,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Furniture and fixtures</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>150,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>151,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>3,754,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>3,905,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Less accumulated depreciation and amortization</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(2,449,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(2,042,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,305,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,863,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left>&nbsp;</TD></TR></TABLE>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Depreciation and amortization expense for the years ended December 31, 2004, 2003 and 2002 amounted
to $741,000, $672,000 and $725,000, respectively. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>NOTE E - INTANGIBLE ASSETS, NET </B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>In several transactions during September and October of 2000, WFN acquired the stock of WFN Women&#146;s
Financial Network, Inc. (&#147;WFNI&#148;) and HerDollar.com, Inc., respectively, companies in the
development stage which had yet to commence principal operations, had no significant revenue and
had assets consisting principally of websites, content and domain names, for aggregate consideration
of $2,310,000 including costs. The transactions have been accounted for as purchases of assets consisting
of domain name, website and content, and a non-compete agreement (the &#147;Acquired Intangible Assets&#148;).
Related deferred tax assets attributable to net operating loss carryforwards of the acquired companies
and deferred tax liabilities attributable to the excess of the statement bases of the acquired assets
over their tax bases have been reflected in the accompanying consolidated financial statements as
an adjustment to the carrying amount of such intangibles (see Note F).</FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>During 2002, Siebert purchased certain retail discount brokerage accounts in two separate transactions
for an aggregate cost of approximately $1,045,000. </FONT></P>
<P align=center><FONT face="Times New Roman, Times, serif" size=2>F-11</FONT></P>
<HR noShade SIZE=5>

<P style="PAGE-BREAK-BEFORE: always">
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>NOTE E - INTANGIBLE ASSETS, NET (CONTINUED)</B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>In January 2003, Siebert acquired certain retail discount brokerage accounts from Your Discount Broker,
Inc. (&#147;YDB&#148;) for $1.1 million. These accounts were transferred to Siebert in March 2003.
</FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>In February 2004, the Company acquired certain retail discount brokerage accounts from Wall Street
Discount Corp. (&#147;WSD&#148;) for $400,000. These accounts were transferred to Siebert in April
2004. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Intangible assets consist of the following: </FONT></P>
<TABLE cellSpacing="0" cellPadding="0" width="600" border="0">

<TR vAlign=bottom>
<TH colSpan=2><FONT face="Times New Roman, Times, Serif" size=2></FONT></TH>
<TH colSpan=5><B><FONT face="Times New Roman, Times, Serif" size=1>DECEMBER 31, 2004</FONT></B></TH>
<TH>&nbsp;</TH>
<TH colSpan=5><B><FONT face="Times New Roman, Times, Serif" size=1>DECEMBER 31, 2003</FONT></B></TH>
<TH>&nbsp;</TH></TR>
<TR vAlign=bottom>
<TH colSpan=2>&nbsp;</TH>
<TH colSpan=5>
<HR noShade SIZE=1>
</TH>
<TH>&nbsp;</TH>
<TH colSpan=5>
<HR noShade SIZE=1>
</TH>
<TH>&nbsp;</TH></TR>
<TR vAlign=bottom>
<TH colSpan=2><FONT face="Times New Roman, Times, Serif" size=2></FONT></TH>
<TH noWrap colSpan=2><B><FONT face="Times New Roman, Times, Serif" size=1>Gross<BR>Carrying<BR>Amount</FONT></B></TH>
<TH noWrap>&nbsp;</TH>
<TH noWrap colSpan=2><B><FONT face="Times New Roman, Times, Serif" size=1>Accumulated<BR>Amortization</FONT></B></TH>
<TH noWrap>&nbsp;</TH>
<TH noWrap colSpan=2><FONT face="Times New Roman, Times, Serif" size=1>Gross<BR>Carrying<BR>Amount</FONT></TH>
<TH noWrap>&nbsp;</TH>
<TH noWrap colSpan=2><B><FONT face="Times New Roman, Times, Serif" size=1>Accumulated<BR>Amortization</FONT></B></TH>
<TH>&nbsp;</TH></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Amortizable assets:</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="9%"><FONT face="Times New Roman, Times, Serif" size=2></FONT></TD>
<TD align=left width="3%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="9%"><FONT face="Times New Roman, Times, Serif" size=2></FONT></TD>
<TD align=left width="3%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="9%"><FONT face="Times New Roman, Times, Serif" size=2></FONT></TD>
<TD align=left width="3%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="9%"><FONT face="Times New Roman, Times, Serif" size=2></FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Website, content and non-compete</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>2,350,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>2,350,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>2,350,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>2,256,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Retail brokerage accounts</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>2,588,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,321,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>2,195,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>692,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR>
<TD colSpan=2></TD>
<TD colSpan=3></TD>
<TD colSpan=3></TD>
<TD colSpan=3></TD>
<TD colSpan=3></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>4,938,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>3,671,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>4,545,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>2,948,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Unamortized intangible assets:</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Domain name/intellectual property</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>750,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>750,000</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Amortization expense</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>723,000</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,106,000</FONT></TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD noWrap align=left><FONT face="Times New Roman, Times, Serif" size=2>Estimated amortization expense is as follows:</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align="CENTER">&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;YEAR ENDING</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;DECEMBER 31,</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align="CENTER">&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>2005</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>525,000</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>2006</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>312,000</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>2007</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>312,000</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>2008</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>92,000</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>2009</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>26,000</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,267,000</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR>
<TD colSpan=2></TD>
<TD colSpan=3></TD>
<TD colSpan=3></TD>
<TD colSpan=3></TD>
<TD colSpan=3></TD></TR>
<TR>
<TD colSpan=2></TD>
<TD colSpan=3></TD>
<TD colSpan=3></TD>
<TD colSpan=3></TD>
<TD colSpan=3></TD></TR>
<TR>
<TD colSpan=2></TD>
<TD colSpan=3></TD>
<TD colSpan=3></TD>
<TD colSpan=3></TD>
<TD colSpan=3></TD></TR></TABLE>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>NOTE F - INCOME TAXES</FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Income tax provision (benefit) consists of the following:</FONT></P>
<TABLE cellSpacing="0" cellPadding="0" width="600" border="0">

<TR vAlign=bottom>
<TH colSpan=2><FONT face="Times New Roman, Times, Serif" size=2></FONT></TH>
<TH colSpan=8><B><FONT face="Times New Roman, Times, Serif" size=1>YEAR ENDED DECEMBER 31,</FONT></B></TH>
<TH>&nbsp;</TH></TR>
<TR vAlign=bottom>
<TH colSpan=2>&nbsp;</TH>
<TH colSpan=8>
<HR noShade SIZE=1>
</TH>
<TH>&nbsp;</TH></TR>
<TR vAlign=bottom>
<TH colSpan=2><FONT face="Times New Roman, Times, Serif" size=2></FONT></TH>
<TH align="CENTER" colSpan=2><B><FONT face="Times New Roman, Times, Serif" size=1>2004</FONT></B></TH>
<TH align="CENTER">&nbsp;</TH>
<TH align="CENTER" colSpan=2><B><FONT face="Times New Roman, Times, Serif" size=1>2003</FONT></B></TH>
<TH align="CENTER">&nbsp;</TH>
<TH align="CENTER" colSpan=2><B><FONT face="Times New Roman, Times, Serif" size=1>2002</FONT></B></TH>
<TH>&nbsp;</TH></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Federal income tax provision (benefit):</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2></FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2></FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2></FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR>
<TD colSpan=2></TD>
<TD colSpan=3></TD>
<TD colSpan=3></TD>
<TD colSpan=3></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Current</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right width="9%"><FONT face="Times New Roman, Times, Serif" size=2>253,000</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right width="9%"><FONT face="Times New Roman, Times, Serif" size=2></FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right width="9%"><FONT face="Times New Roman, Times, Serif" size=2>(19,000</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Deferred</U></FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="9%"><FONT face="Times New Roman, Times, Serif" size=2>42,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2></FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="9%"><FONT face="Times New Roman, Times, Serif" size=2>(33,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="9%"><FONT face="Times New Roman, Times, Serif" size=2>(1,014,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD></TR>
<TR>
<TD colSpan=2></TD>
<TD colSpan=3></TD>
<TD colSpan=3></TD>
<TD colSpan=3></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>295,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(33,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(1,033,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>State and local tax provision (benefit):</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR>
<TD colSpan=2></TD>
<TD colSpan=3></TD>
<TD colSpan=3></TD>
<TD colSpan=3></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Current</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>145,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>44,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(231,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Deferred</U></FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>10,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2></FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>59,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(321,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD></TR>
<TR>
<TD colSpan=2></TD>
<TD colSpan=3></TD>
<TD colSpan=3></TD>
<TD colSpan=3></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>155,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>103,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(552,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Total tax provision (benefit):</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR>
<TD colSpan=2></TD>
<TD colSpan=3></TD>
<TD colSpan=3></TD>
<TD colSpan=3></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Current</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>398,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>44,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(250,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Deferred</U></FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>52,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2></FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>26,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(1,335,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD></TR>
<TR>
<TD colSpan=2></TD>
<TD colSpan=3></TD>
<TD colSpan=3></TD>
<TD colSpan=3></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>450,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>70,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(1,585,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left>&nbsp;</TD></TR></TABLE>
<P align=center><FONT face="Times New Roman, Times, serif" size=2>F-12</FONT></P>
<HR noShade SIZE=5>

<P style="PAGE-BREAK-BEFORE: always">
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>NOTE F - INCOME TAXES (CONTINUED) </B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>A reconciliation between the income tax provision (benefit) and income taxes computed by applying the
statutory Federal income tax rate to income (loss) before taxes is as follows: </FONT></P>
<TABLE cellSpacing="0" cellPadding="0" width="600" border="0">

<TR vAlign=bottom>
<TH colSpan=11><FONT face="Times New Roman, Times, Serif" size=2><B><U>YEAR ENDED DECEMBER 31,</U></B></FONT></TH></TR>
<TR vAlign=bottom>
<TH><FONT face="Times New Roman, Times, serif" size=1></FONT></TH>
<TH><FONT face="Times New Roman, Times, serif" size=1></FONT></TH>
<TH colSpan=2><FONT face="Times New Roman, Times, serif" size=1></FONT></TH>
<TH><FONT face="Times New Roman, Times, serif" size=1></FONT></TH>
<TH colSpan=2><FONT face="Times New Roman, Times, serif" size=1></FONT></TH>
<TH><FONT face="Times New Roman, Times, serif" size=1></FONT></TH>
<TH colSpan=2><FONT face="Times New Roman, Times, serif" size=1></FONT></TH>
<TH><FONT face="Times New Roman, Times, serif" size=1></FONT></TH></TR>
<TR vAlign=bottom>
<TH>&nbsp;</TH>
<TH>&nbsp;</TH>
<TH colSpan=2><B><FONT face="Times New Roman, Times, Serif" size=1>2004</FONT></B></TH>
<TH>&nbsp;</TH>
<TH colSpan=2><B><FONT face="Times New Roman, Times, Serif" size=1>2003</FONT></B></TH>
<TH>&nbsp;</TH>
<TH colSpan=2><B><FONT face="Times New Roman, Times, Serif" size=1>2002</FONT></B></TH>
<TH>&nbsp;</TH></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Expected income tax provision (benefit) at statutory Federal</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="8%"><FONT face="Times New Roman, Times, Serif" size=2></FONT></TD>
<TD align=left width="4%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="7%"><FONT face="Times New Roman, Times, Serif" size=2></FONT></TD>
<TD align=left width="4%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="10%"><FONT face="Times New Roman, Times, Serif" size=2></FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;tax rate</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>335,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>66,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(1,094,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>State and local taxes, net of Federal tax effect</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>79,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>15,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(241,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD></TR>
<TR>
<TD colSpan=2></TD>
<TD colSpan=3></TD>
<TD colSpan=3></TD>
<TD colSpan=3></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Other *</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>36,000</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(11,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD>
<TD align=right>&nbsp;</TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(250,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Income tax expense (benefit)</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>450,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>70,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(1,585,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left>&nbsp;</TD></TR></TABLE>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>*&nbsp;State tax adjustment&nbsp;</FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Deferred income taxes reflect the impact of temporary differences between the amounts of assets and
liabilities for financial reporting purposes and the tax treatments of such amounts. The principal
items giving rise to deferred tax assets (liabilities) are as follows: </FONT></P>
<TABLE cellSpacing="0" cellPadding="0" width="600" border="0">

<TR vAlign=bottom>
<TH colSpan=2><FONT face="Times New Roman, Times, Serif" size=2></FONT></TH>
<TH colSpan=5><B><FONT face="Times New Roman, Times, Serif" size=1>DECEMBER 31,</FONT></B><FONT face="Times New Roman, Times, Serif" size=2></FONT></TH>
<TH>&nbsp;</TH></TR>
<TR vAlign=bottom>
<TH colSpan=2>&nbsp;</TH>
<TH colSpan=5>
<HR noShade SIZE=1>
</TH>
<TH>&nbsp;</TH></TR>
<TR vAlign=bottom>
<TH colSpan=2><FONT face="Times New Roman, Times, Serif" size=2></FONT></TH>
<TH colSpan=2><B><FONT face="Times New Roman, Times, Serif" size=1>2003</FONT></B></TH>
<TH>&nbsp;</TH>
<TH colSpan=2><B><FONT face="Times New Roman, Times, Serif" size=1>2003</FONT></B></TH>
<TH>&nbsp;</TH></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Net operating losses</FONT></TD>
<TD align=left width="3%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right width="11%"><FONT face="Times New Roman, Times, Serif" size=2>479,000</FONT></TD>
<TD align=left width="5%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right width="11%"><FONT face="Times New Roman, Times, Serif" size=2>724,000</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Acquired Intangible assets</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(315,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(379,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Furniture, equipment and leasehold improvements</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(164,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(8,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Retail brokerage accounts</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>501,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>216,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>501,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>553,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left>&nbsp;</TD></TR></TABLE>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Management believes that it is more likely than not that the deferred tax asset will be realized, and
therefore no valuation allowance has been provided. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Net operating loss carryforwards of $1,140,000, which is the net operating loss carryforwards of WFN,
expire through 2023. Utilization of the net operating loss carryforward relating to WFN is subject
to annual limitations under Section 382 of the Internal Revenue Code. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>In 2003 and 2001, the Company reduced current taxes payable by $15,000 and $14,000, respectively, resulting
from the deductibility of the difference between the exercise price of nonqualifying stock options
granted by the Company and the market value of the stock on the dates of exercise. The tax benefit
was recorded as a credit to paid-in capital. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>NOTE G - STOCKHOLDERS&#146; EQUITY </B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Siebert is subject to the SEC&#146;s Uniform Net Capital Rule (Rule 15c3-1), which requires the maintenance
of minimum net capital. Siebert has elected to use the alternative method, permitted by the rule,
which requires that Siebert maintain minimum net capital, as defined, equal to the greater of $250,000
or 2 percent of aggregate debit balances arising from customer transactions, as defined. (The Net
Capital Rule of the New York Stock Exchange also provides that equity capital may not be withdrawn
or cash dividends paid if resulting net capital would be less than 5% of aggregate debits.) At December
31, 2004 and 2003, Siebert had net capital of approximately $16,846,000 and $15,362,000, respectively,
as compared with net capital requirements of $250,000. Siebert claims exemption from the reserve
requirement under Section 15c3-3(k)(2)(ii). </FONT></P>
<P align=center><FONT face="Times New Roman, Times, serif" size=2>F-13</FONT></P>
<HR noShade SIZE=5>

<P style="PAGE-BREAK-BEFORE: always">
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>The 1998 Restricted Stock Award Plan (the &#147;Award Plan&#148;), provides for awards of not more
than 60,000 shares of the Company&#146;s common stock, subject to adjustments for stock splits, stock
dividends and other changes in the Company&#146;s capitalization, to key employees, to be issued
either immediately after the award or at a future date. As provided in the Award Plan and subject
to restrictions, shares awarded may not be disposed of by the recipients for a period of one year
from the date of the award. Cash dividends on shares awarded are held by the Company for the benefit
of the recipients and are paid upon lapse of the restrictions. During 1998 and 1999, the Company
awarded an aggregate of 41,400 shares, net of forfeitures of 8,050 shares, under the Award Plan.
The shares which vest one year from the date of grant, were valued at market value on the date of
grant and are being charged to expense over the vesting periods. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>On May 15, 2000, the Board of Directors of the Company authorized a buy back of up to one million shares
of common stock. Shares will be purchased from time to time in the open market and in private transactions.
Through December 31, 2004, 901,616 shares were purchased at an average price of $4.54. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>NOTE H - OPTIONS </B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>The Company&#146;s 1997 Stock Option Plan, as amended, (the &#147;Plan&#148;) authorizes the grant
of options to purchase up to an aggregate of 4,200,000 shares, subject to adjustment in certain circumstances.
Both non-qualified options and options intended to qualify as &#147;Incentive Stock Options&#148;
under Section 422 of the Internal Revenue Code, as amended, may be granted under the Plan. A Stock
Option Committee of the Board of Directors administers the Plan. The committee has the authority
to determine when options are granted, the term during which an option may be exercised (provided
no option has a term exceeding 10 years), the exercise price and the exercise period. The exercise
price shall generally be not less than the fair market value on the date of grant. No option may
be granted under the Plan after December 2007. Generally, employee options vest 20% per year for
five years and expire ten years from the date of grant. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>A summary of the Company&#146;s stock option transaction for the three years ended December 31, 2004
is presented below: </FONT></P>
<TABLE cellSpacing="0" cellPadding="0" width="600" border="0">

<TR vAlign=bottom>
<TH colSpan=2><FONT face="Times New Roman, Times, Serif" size=1></FONT></TH>
<TH colSpan=5><FONT face="Times New Roman, Times, Serif" size=1>2004</FONT><FONT face="Times New Roman, Times, Serif" size=1></FONT></TH>
<TH>&nbsp;</TH>
<TH colSpan=5><FONT face="Times New Roman, Times, Serif" size=1>2003</FONT><FONT face="Times New Roman, Times, Serif" size=1></FONT></TH>
<TH>&nbsp;</TH>
<TH colSpan=5><FONT face="Times New Roman, Times, Serif" size=1>2002</FONT><FONT face="Times New Roman, Times, Serif" size=1></FONT></TH>
<TH>&nbsp;</TH></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=5>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=5>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=5>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TH colSpan=2><FONT face="Times New Roman, Times, Serif" size=1></FONT></TH>
<TH noWrap colSpan=2><FONT face="Times New Roman, Times, Serif" size=1>Shares</FONT></TH>
<TH noWrap>&nbsp;</TH>
<TH noWrap colSpan=2><FONT face="Times New Roman, Times, Serif" size=1>Weighted<BR>Average<BR>Exercise<BR>Price</FONT></TH>
<TH noWrap>&nbsp;</TH>
<TH noWrap colSpan=2><FONT face="Times New Roman, Times, Serif" size=1>Shares</FONT></TH>
<TH noWrap>&nbsp;</TH>
<TH noWrap colSpan=2><FONT face="Times New Roman, Times, Serif" size=1>Weighted<BR>Average<BR>Exercise<BR>Price</FONT></TH>
<TH noWrap>&nbsp;</TH>
<TH noWrap colSpan=2><FONT face="Times New Roman, Times, Serif" size=1>Shares</FONT></TH>
<TH noWrap>&nbsp;</TH>
<TH noWrap colSpan=2><FONT face="Times New Roman, Times, Serif" size=1>Weighted<BR>Average<BR>Exercise<BR>Price</FONT></TH>
<TH>&nbsp;</TH></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD noWrap align=left><FONT face="Times New Roman, Times, Serif" size=2>Outstanding - beginning of the year</FONT></TD>
<TD align=left width="1%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="8%"><FONT face="Times New Roman, Times, Serif" size=2>1,802,930</FONT></TD>
<TD align=left width="3%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right width="7%"><FONT face="Times New Roman, Times, Serif" size=2>4.08</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="8%"><FONT face="Times New Roman, Times, Serif" size=2>1,855,260</FONT></TD>
<TD align=left width="3%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right width="7%"><FONT face="Times New Roman, Times, Serif" size=2>4.39</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="8%"><FONT face="Times New Roman, Times, Serif" size=2>799,820</FONT></TD>
<TD align=left width="3%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right width="7%"><FONT face="Times New Roman, Times, Serif" size=2>5.62</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Granted</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>90,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>4.60</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>50,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>3.87</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,155,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>4.16</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Forfeited</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(4,580</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>3.85</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(86,580</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>11.02</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(63,440</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>3.69</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Exercised</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>0</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>0.00</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(15,750</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>2.31</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(36,120</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>2.31</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Outstanding - end of year</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,888,350</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>4.11</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,802,930</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>4.08</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,855,260</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>4.39</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Exercisable at end of year</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,556,950</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>4.06</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,407,230</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>3.98</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>575,660</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>3.99</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Weighted average fair value</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>of options granted</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>3.01</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>3.09</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>3.50</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR></TABLE>
<P align=center><FONT face="Times New Roman, Times, serif" size=2>F-14</FONT></P>
<HR noShade SIZE=5>

<P style="PAGE-BREAK-BEFORE: always">
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>NOTE H - OPTIONS (CONTINUED) </B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>The following table summarizes information related to options outstanding at December 31, 2004: </FONT></P>
<TABLE cellSpacing="0" cellPadding="0" width="600" border="0">

<TR vAlign=bottom>
<TH colSpan=2><FONT face="Times New Roman, Times, Serif" size=1></FONT></TH>
<TH colSpan=8><FONT face="Times New Roman, Times, Serif" size=1></FONT><FONT face="Times New Roman, Times, Serif" size=1></FONT><FONT face="Times New Roman, Times, Serif" size=1>Options Outstanding</FONT><FONT face="Times New Roman, Times, Serif" size=1></FONT><FONT face="Times New Roman, Times, Serif" size=1></FONT></TH>
<TH>&nbsp;</TH>
<TH colSpan=5><FONT face="Times New Roman, Times, Serif" size=1></FONT><FONT face="Times New Roman, Times, Serif" size=1>Options Exercisable</FONT><FONT face="Times New Roman, Times, Serif" size=1></FONT></TH>
<TH>&nbsp;</TH></TR>
<TR vAlign=bottom>
<TH colSpan=2>&nbsp;</TH>
<TH colSpan=8>
<HR noShade SIZE=1>
</TH>
<TH>&nbsp;</TH>
<TH colSpan=5>
<HR noShade SIZE=1>
</TH>
<TH>&nbsp;</TH></TR>
<TR vAlign=bottom>
<TH noWrap><FONT face="Times New Roman, Times, Serif" size=1>Range<BR>Exercise<BR>Prices</FONT></TH>
<TH noWrap>&nbsp;</TH>
<TH noWrap colSpan=2><FONT face="Times New Roman, Times, Serif" size=1>Number<BR>Outstanding</FONT></TH>
<TH noWrap>&nbsp;</TH>
<TH noWrap colSpan=2><FONT face="Times New Roman, Times, Serif" size=1>Weighted Average<BR>Remaining<BR>Contractual Life</FONT></TH>
<TH noWrap>&nbsp;</TH>
<TH noWrap colSpan=2><FONT face="Times New Roman, Times, Serif" size=1>Weighted<BR>Average<BR>Exercise<BR>Price</FONT></TH>
<TH noWrap>&nbsp;</TH>
<TH noWrap colSpan=2><FONT face="Times New Roman, Times, Serif" size=1>Number<BR>Exercisable</FONT></TH>
<TH noWrap>&nbsp;</TH>
<TH noWrap colSpan=2><FONT face="Times New Roman, Times, Serif" size=1>Weighted<BR>Average<BR>Exercise<BR>Price</FONT></TH>
<TH>&nbsp;</TH></TR>
<TR vAlign=bottom>
<TH>
<HR noShade SIZE=1>
</TH>
<TH>&nbsp;</TH>
<TH colSpan=2>
<HR noShade SIZE=1>
</TH>
<TH>&nbsp;</TH>
<TH colSpan=2>
<HR noShade SIZE=1>
</TH>
<TH>&nbsp;</TH>
<TH colSpan=2>
<HR noShade SIZE=1>
</TH>
<TH>&nbsp;</TH>
<TH colSpan=2>
<HR noShade SIZE=1>
</TH>
<TH>&nbsp;</TH>
<TH colSpan=2>
<HR noShade SIZE=1>
</TH>
<TH>&nbsp;</TH></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align="CENTER"><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align="CENTER"><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align="CENTER" width="18%"><FONT face="Times New Roman, Times, Serif" size=2>$0.00- 2.31</FONT> <FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left width="3%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="12%"><FONT face="Times New Roman, Times, Serif" size=2>15,000</FONT></TD>
<TD align=left width="3%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align="CENTER" width="1%">&nbsp;</TD>
<TD align="CENTER" width="15%"><FONT face="Times New Roman, Times, Serif" size=2>7.8 Years</FONT></TD>
<TD align=left width="3%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right width="7%"><FONT face="Times New Roman, Times, Serif" size=2>2.12</FONT></TD>
<TD align=left width="3%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="12%"><FONT face="Times New Roman, Times, Serif" size=2>6,000</FONT></TD>
<TD align=left width="3%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right width="7%"><FONT face="Times New Roman, Times, Serif" size=2>2.12</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>$2.32- 2.69</FONT> <FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>351,850</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align="CENTER">&nbsp;</TD>
<TD align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>2.9 Years</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>2.38</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>331,850</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>2.36</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>$2.70- 5.33</FONT> <FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,514,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align="CENTER">&nbsp;</TD>
<TD align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>6.6 Years</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>4.46</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,211,600</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>4.44</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>$5.34-32.50</FONT> <FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>7,500</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align="CENTER">&nbsp;</TD>
<TD align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>4.9 Years</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>17.81</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>75,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>17.81</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD>
<HR noShade SIZE=1>
</TD>
<TD>&nbsp;</TD>
<TD colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD>&nbsp;</TD>
<TD colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD>&nbsp;</TD>
<TD colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD>&nbsp;</TD>
<TD colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD>&nbsp;</TD>
<TD colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align="CENTER"><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align="CENTER"><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>$0.00-32.50</FONT> <FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,888,350</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align="CENTER">&nbsp;</TD>
<TD align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>5.9 Years</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>4.11</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,556,950</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>4.06</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD>
<HR noShade SIZE=2>
</TD>
<TD>&nbsp;</TD>
<TD colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD>&nbsp;</TD>
<TD colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD>&nbsp;</TD>
<TD colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD>&nbsp;</TD>
<TD colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD>&nbsp;</TD>
<TD colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD>&nbsp;</TD></TR></TABLE>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>At December 31, 2004, approximately 1,880,660 shares of the Company&#146;s common stock have been reserved
for future issuance under the Plan, the Award Plan and for options granted to directors. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>NOTE I - FINANCIAL INSTRUMENTS WITH OFF-BALANCE SHEET RISK AND CONCENTRATIONS OF CREDIT RISK </B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>In the normal course of business, Siebert enters into transactions in various financial instruments
with off-balance sheet risk. This risk includes both market and credit risk, which may be in excess
of the amounts recognized in the statement of financial condition. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Retail customer transactions are cleared through clearing brokers on a fully disclosed basis. In the
event that customers are unable to fulfill their contractual obligations, the clearing broker may
charge Siebert for any loss incurred in connection with the purchase or sale of securities at prevailing
market prices to satisfy customers&#146; obligations. Siebert regularly monitors the activity in
its customer accounts for compliance with its margin requirements. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Siebert is exposed to the risk of loss on unsettled customer transactions in the event customers and
other counterparties are unable to fulfill contractual obligations. Securities transactions entered
into as of December 31, 2004 settled with no adverse effect on Siebert&#146;s financial condition. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>NOTE J - COMMITMENTS AND CONTINGENT LIABILITIES </B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Siebert terminated the fully disclosed clearing agreement (the &#147;Clearing Agreement&#148;) with
Pershing LLC (formerly the Pershing division of Donaldson, Lufkin &amp; Jenrette Securities Corporation)
(&#147;Pershing&#148;). Based on consultation with counsel, Siebert believes that the $1,500,000
that it advanced to Pershing in January 2003 should be returned and that Pershing may be liable for
damages. Pershing has expressed its belief that it is entitled to retain the advance and receive
a minimum of $3 million for its unreimbursed costs, a termination fee of $500,000 and $5 million
for lost revenues. Siebert believes the Pershing claims are without merit and that the ultimate result
of this matter will not have a material adverse effect on result of operations or financial positions.
Siebert has decided not to commence proceedings against Pershing at the present time. As a result,
Siebert has charged the $1,500,000 advance to Pershing against income in the fourth quarter of 2004
since recent communication indicated that Pershing and the Company cannot resolve this matter. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>In August 2004, Siebert participated as an underwriter in the Google, Inc. initial public offering.
To participate as an underwriter, the lead Investment Banks (the &#147;Banks&#148;) requested that
each underwriter provide the Banks with a $25 million Letter of Credit on behalf of Siebert in favor
of the Banks. To obtain the Letter of Credit, Siebert entered into a Temporary Subordinated Loan
Agreement with NFS. On August 6, 2004, Siebert entered into a Letter of Credit for $25 million and
terminated the Letter of Credit and paid the temporary subordinated loan agreement with NFS on September
15, 2004. </FONT></P>
<P align=center><FONT face="Times New Roman, Times, serif" size=2>F-15</FONT></P>
<HR noShade SIZE=5>

<P style="PAGE-BREAK-BEFORE: always">
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>The Company rents office space under long-term operating leases expiring in various periods through
2009. These leases call for base rent plus escalations for taxes and operating expenses. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Future minimum base rental payments under these operating leases are as follows: </FONT></P>
<TABLE cellSpacing="0" cellPadding="0" width="600" border="0">

<TR vAlign=bottom>
<TH align=left><FONT face="Times New Roman, Times, Serif" size=1>YEAR ENDING<BR>DECEMBER 31,</FONT></TH>
<TH>&nbsp;</TH>
<TH align=right><FONT face="Times New Roman, Times, Serif" size=1>AMOUNT</FONT></TH>
<TH>&nbsp;</TH></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>2005</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="12%"><FONT face="Times New Roman, Times, Serif" size=2>$&nbsp;&nbsp;&nbsp;850,000</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>2006</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>792,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>2007</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>375,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>2008</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>369,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>2009</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>180,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$2,566,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>
<HR noShade SIZE=2>
</TD>
<TD align=left>&nbsp;</TD></TR></TABLE>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Rent expense, including escalations for operating costs, amounted to approximately $984,000, $1,041,000
and $844,000 for the years ended December 31, 2004, 2003 and 2002, respectively. Rent is being charged
to expense over the entire lease term on a straight-line basis. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>In addition to Pershing LLC matter, Siebert is party to certain claims, suits and complaints arising
in the ordinary course of business. In the opinion of management, all such claims, suits and complaints
are without merit, or involve amounts which would not have a significant effect on the financial
position or results of operations of the Company. The Company believes that adequate provisions have
been made for such matters. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Siebert sponsors a defined contribution retirement plan under Section 401(k) of the Internal Revenue
Code that covers substantially all employees. Participant contributions to the plan are voluntary
and are subject to certain limitations. Siebert may also make discretionary contributions to the
plan. No contributions were made by Siebert in 2004, 2003 and 2002. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Siebert is party to a Secured Demand Note Collateral Agreement with SBS which obligates Siebert to
lend SBS, on a subordinated basis, up to $1,200,000. Amounts that Siebert is obligated to lend under
this arrangement are reported as &#147;cash equivalents - restricted&#148;, currently in the amount
of $1,300,000. This obligation is not included in the Company&#146;s statement of financial condition
because it has not been drawn down upon by SBS. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>NOTE K </B></FONT><FONT face="Times New Roman, Times, serif" size=2><B>&#150;</B></FONT><FONT face="Times New Roman, Times, Serif" size=2><B> FAIR VALUE OF FINANCIAL INSTRUMENTS </B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>The carrying amounts reflected in the consolidated statements of financial condition for cash, cash
equivalents, receivable from broker, accounts payable and accrued liabilities approximate fair value
due to the short term maturities of those instruments. Securities owned and securities sold, not
yet purchased are carried at market value, in accordance with industry practice for broker-dealers
in securities. </FONT></P>
<P><FONT face="Times New Roman, Times, serif" size=2><B>NOTE L &#150; VALUATION AND QUALIFYING ACCOUNTS </B></FONT></P>
<P><FONT face="Times New Roman, Times, serif" size=2>The following is a summary of accumulated depreciation and accumulated amortization expenses for the
years ended December 31: </FONT></P>
<TABLE cellSpacing="0" cellPadding="0" width=720 border="0">

<TR vAlign=bottom>
<TH><FONT face="Times New Roman, Times, Serif" size=1>Description</FONT></TH>
<TH width="13%"><FONT face="Times New Roman, Times, serif" size=1>Balance at<BR>beginning<BR>of period </FONT></TH>
<TH width="2%">&nbsp;</TH>
<TH width="2%">&nbsp;</TH>
<TH width="13%"><FONT face="Times New Roman, Times, Serif" size=1>Charged<BR>to cost<BR>and<BR>expenses </FONT></TH>
<TH width="2%">&nbsp;</TH>
<TH width="2%">&nbsp;</TH>
<TH width="13%"><FONT face="Times New Roman, Times, Serif" size=1>Deductions</FONT></TH>
<TH width="2%">&nbsp;</TH>
<TH width="2%">&nbsp;</TH>
<TH width="13%">
<P><FONT face="Times New Roman, Times, Serif" size=1>Balance at<BR>end of<BR>period </FONT></P></TH>
<TH width="2%">&nbsp;</TH></TR>
<TR vAlign=bottom>
<TD align=left>
<HR align=center width=70 noShade SIZE=1>
</TD>
<TD align=right>
<HR noShade SIZE=1>
</TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right>
<HR noShade SIZE=1>
</TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right>
<HR noShade SIZE=1>
</TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right>
<HR noShade SIZE=1>
</TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>Accumulated depreciation: </FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Year ended December 31, 2002 </FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>1,200,000</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>725,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>341,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2><SUP>(a)</SUP></FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>1,584,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Year ended December 31, 2003</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>1,584,000</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>672,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>214,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2><SUP>(a)</SUP></FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>2,042,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Year ended December 31, 2004</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>2,042,000</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>741,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>334,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2><SUP>(a)</SUP></FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>2,449,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>Accumulated amortization : </FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Year ended December 31, 2002 </FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>850,000</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>992,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT size=2>&#151;</FONT></TD>
<TD align=left></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>1,842,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Year ended December 31, 2003</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>1,842,000</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>1,106,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT size=2>&#151;</FONT></TD>
<TD align=left></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>2,948,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Year ended December 31, 2004</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>2,948,000</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>723,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&#151;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>3,671,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR></TABLE>
<P><FONT face="Times New Roman, Times, serif" size=2>(a) Write off of fixed asset desposition against reserve</FONT>. </P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>NOTE M &#150; SUBSEQUENT EVENT</B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>On March 2005, Siebert consented without admitting or denying guilt to a $45,000 fine and censure by
the NYSE due to findings of books-and-records, financial, operational and supervisory deficiencies.
This action was based on technical record keeping and administrative deficiencies.</FONT></P>
<P align=center><FONT face="Times New Roman, Times, serif" size=2>F-16</FONT></P>
<HR noShade SIZE=5>

<P style="PAGE-BREAK-BEFORE: always">
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>SIEBERT FINANCIAL CORP. AND SUBSIDIARIES </B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>NOTES TO CONSOLIDATED FINANCIAL STATEMENTS </B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>NOTE M - SUMMARIZED QUARTERLY FINANCIAL DATA (UNAUDITED) </B></FONT></P>
<TABLE cellSpacing="0" cellPadding="0" width="100%" border="0">

<TR vAlign=bottom>
<TH>&nbsp;</TH>
<TH colSpan=2>&nbsp;</TH>
<TH>&nbsp;</TH>
<TH colSpan=5><FONT face="Times New Roman, Times, serif" size=1>2004</FONT></TH>
<TH>&nbsp;</TH>
<TH colSpan=2>&nbsp;</TH>
<TH>&nbsp;</TH>
<TH colSpan=2>&nbsp;</TH>
<TH>&nbsp;</TH>
<TH colSpan=5><FONT face="Times New Roman, Times, serif" size=1>2003</FONT></TH>
<TH>&nbsp;</TH>
<TH colSpan=2>&nbsp;</TH>
<TH>&nbsp;</TH></TR>
<TR vAlign=bottom>
<TH>&nbsp;</TH>
<TH colSpan=11>
<HR noShade SIZE=1>
</TH>
<TH>&nbsp;</TH>
<TH colSpan=11>
<HR noShade SIZE=1>
</TH>
<TH>&nbsp;</TH></TR>
<TR vAlign=bottom>
<TH><FONT face="Times New Roman, Times, serif" size=1></FONT></TH>
<TH colSpan=2><FONT face="Times New Roman, Times, serif" size=1>FIRST<BR>QUARTER</FONT></TH>
<TH>&nbsp;</TH>
<TH colSpan=2><FONT face="Times New Roman, Times, serif" size=1>SECOND<BR>QUARTER</FONT></TH>
<TH>&nbsp;</TH>
<TH colSpan=2><FONT face="Times New Roman, Times, serif" size=1>THIRD<BR>QUARTER</FONT></TH>
<TH>&nbsp;</TH>
<TH colSpan=2><FONT face="Times New Roman, Times, serif" size=1>FOURTH<BR>QUARTER</FONT></TH>
<TH>&nbsp;</TH>
<TH colSpan=2><FONT face="Times New Roman, Times, serif" size=1>FIRST<BR>QUARTER</FONT></TH>
<TH>&nbsp;</TH>
<TH colSpan=2><FONT face="Times New Roman, Times, serif" size=1>SECOND<BR>QUARTER</FONT></TH>
<TH>&nbsp;</TH>
<TH colSpan=2><FONT face="Times New Roman, Times, serif" size=1>THIRD<BR>QUARTE</FONT></TH>
<TH>&nbsp;</TH>
<TH colSpan=2><FONT face="Times New Roman, Times, serif" size=1>FOURTH<BR>QUARTER</FONT></TH>
<TH>&nbsp;</TH></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>Revenue</FONT></TD>
<TD align=right width="2%"><FONT face="Times New Roman, Times, serif" size=2>$</FONT></TD>
<TD align=right width="7%"><FONT face="Times New Roman, Times, serif" size=2>7,031,000</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="2%"><FONT face="Times New Roman, Times, serif" size=2>$</FONT></TD>
<TD align=right width="7%"><FONT face="Times New Roman, Times, serif" size=2>6,151,000</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="2%"><FONT face="Times New Roman, Times, serif" size=2>$</FONT></TD>
<TD align=right width="7%"><FONT face="Times New Roman, Times, serif" size=2>7,167,000</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="2%"><FONT face="Times New Roman, Times, serif" size=2>$</FONT></TD>
<TD align=right width="7%"><FONT face="Times New Roman, Times, serif" size=2>7,755,000</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="2%"><FONT face="Times New Roman, Times, serif" size=2>$</FONT></TD>
<TD align=right width="7%"><FONT face="Times New Roman, Times, serif" size=2>5,606,000</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="2%"><FONT face="Times New Roman, Times, serif" size=2>$</FONT></TD>
<TD align=right width="7%"><FONT face="Times New Roman, Times, serif" size=2>6,611,000</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="2%"><FONT face="Times New Roman, Times, serif" size=2>$</FONT></TD>
<TD align=right width="7%"><FONT face="Times New Roman, Times, serif" size=2>6,008,000</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="2%"><FONT face="Times New Roman, Times, serif" size=2>$</FONT></TD>
<TD align=right width="7%"><FONT face="Times New Roman, Times, serif" size=2>6,471,000</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>Net income (loss)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>415,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>230,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>422,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>(534,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>(296,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>246,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>115,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>58,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>Earnings per share: </FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>Basic</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>0.02</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>0.01</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>0.02</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>(0.03</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>(0.01</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>0.01</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>0.01</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&#151;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>Diluted</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>0.02</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>0.01</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>0.02</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>(0.03</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>(0.01</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>0.01</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>0.01</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&#151;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR></TABLE>
<P align=center><FONT face="Times New Roman, Times, serif" size=2>F-17</FONT></P>
<HR noShade SIZE=5>

<P style="PAGE-BREAK-BEFORE: always">
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><STRONG>REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM</STRONG></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Board of Managers <BR></FONT><FONT face="Times New Roman, Times, Serif" size=2>Siebert, Brandford, Shank &amp; Co., L.L.C. <BR>New York, New York </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>We have audited the accompanying statements of financial condition of Siebert, Brandford, Shank &amp;
Co., L.L.C. as of December 31, 2004 and 2003 and the related statements of operations, changes in
members&#146; capital, and cash flows for each of the years in the three-year period ended December
31, 2004. These financial statements are the responsibility of the Company&#146;s management. Our
responsibility is to express an opinion on these financial statements based on our audits. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>We conducted our audit in accordance with the standards of the Public Company Accounting Oversight
Board&nbsp; (United States).&nbsp;Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material misstatement. An
audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the
financial statements. An audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>In our opinion, the financial statements enumerated above present fairly, in all material respects,
the financial position of Siebert, Brandford, Shank &amp; Co., L.L.C. as of December 31, 2004 and
2003, and the results of its operations and its cash flows for each of the years in the three-year
period ended December 31, 2004 in conformity with U.S. generally accepted accounting principles. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>EISNER LLP </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>New York, New York <BR>February 3, 2005 </FONT></P>
<P align=center><FONT face="Times New Roman, Times, serif" size=2>F-18</FONT></P>
<HR noShade SIZE=5>

<P style="PAGE-BREAK-BEFORE: always">
<P align=center><FONT face="Times New Roman, Times, Serif" size=2><B>SIEBERT, BRANDFORD, SHANK &amp; CO., L.L.C.</B></FONT></P>
<P align=center><FONT face="Times New Roman, Times, Serif" size=2><B><A name=a9></A>STATEMENTS OF FINANCIAL CONDITION</B></FONT></P>
<TABLE cellSpacing="0" cellPadding="0" width="600" border="0">

<TR vAlign=bottom>
<TH>&nbsp;</TH>
<TH colSpan=5><FONT face="Times New Roman, Times, Serif" size=1>DECEMBER 31,</FONT></TH>
<TH>&nbsp;</TH></TR>
<TR vAlign=bottom>
<TH>&nbsp;</TH>
<TH colSpan=5>
<HR noShade SIZE=1>
</TH>
<TH>&nbsp;</TH></TR>
<TR vAlign=bottom>
<TH>&nbsp;</TH>
<TH colSpan=2><FONT face="Times New Roman, Times, Serif" size=1>2004</FONT></TH>
<TH>&nbsp;</TH>
<TH colSpan=2><FONT face="Times New Roman, Times, Serif" size=1>2003</FONT></TH>
<TH>&nbsp;</TH></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>ASSETS</FONT></TD>
<TD align=right colSpan=2><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT> <FONT face="Times New Roman, Times, Serif" size=2></FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right colSpan=2><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT> <FONT face="Times New Roman, Times, Serif" size=2></FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Cash and cash equivalents</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right width="10%"><FONT face="Times New Roman, Times, Serif" size=2>9,053,050</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right width="10%"><FONT face="Times New Roman, Times, Serif" size=2>8,157,676</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Securities owned, at market value</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>10,011</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>15,287</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Accounts receivable</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,507,973</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>388,190</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Receivable from broker</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>7,478</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>7,044</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Secured demand note</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,200,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,200,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Furniture, equipment and leasehold improvements, net</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>203,698</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>128,850</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Other assets</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>343,448</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>275,740</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>12,325,658</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>10,172,787</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT size=2>Committments and Contingency</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>LIABILITIES AND MEMBERS&#146; CAPITAL</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Liabilities:</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Payable to member</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>125,888</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>39,736</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Accounts payable and accrued expenses</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>3,555,380</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>2,470,215</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>3,681,268</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>2,509,951</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Subordinated debt</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,200,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,200,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Members&#146; capital</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>7,444,390</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>6,462,836</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>12,325,658</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>10,172,787</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left>&nbsp;</TD></TR></TABLE>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>See Notes to Financial Statements</FONT></P>
<P align=center><FONT face="Times New Roman, Times, serif" size=2>F-19</FONT></P>
<HR noShade SIZE=5>

<P style="PAGE-BREAK-BEFORE: always">
<P align=center><FONT face="Times New Roman, Times, Serif" size=2><B><A name=a10></A>SIEBERT, BRANDFORD, SHANK &amp; CO., L.L.C.</B></FONT></P>
<P align=center><FONT face="Times New Roman, Times, Serif" size=2><B>STATEMENTS OF OPERATIONS</B></FONT></P>
<P align=center><FONT face="Times New Roman, Times, Serif" size=2><B><U>YEAR ENDED DECEMBER 31,</U></B></FONT></P>
<TABLE cellSpacing="0" cellPadding="0" width="600" border="0">

<TR vAlign=bottom>
<TH><FONT face="Times New Roman, Times, serif" size=1></FONT></TH>
<TH colSpan=2><FONT face="Times New Roman, Times, serif" size=1></FONT></TH>
<TH><FONT face="Times New Roman, Times, serif" size=1></FONT></TH>
<TH colSpan=2><FONT face="Times New Roman, Times, serif" size=1></FONT></TH>
<TH><FONT face="Times New Roman, Times, serif" size=1></FONT></TH>
<TH colSpan=2><FONT face="Times New Roman, Times, serif" size=1></FONT></TH>
<TH><FONT face="Times New Roman, Times, serif" size=1></FONT></TH></TR>
<TR vAlign=bottom>
<TH><FONT face="Times New Roman, Times, Serif" size=1></FONT></TH>
<TH colSpan=2><FONT face="Times New Roman, Times, Serif" size=1>2004</FONT></TH>
<TH>&nbsp;</TH>
<TH colSpan=2><FONT face="Times New Roman, Times, Serif" size=1>2003</FONT></TH>
<TH>&nbsp;</TH>
<TH colSpan=2><FONT face="Times New Roman, Times, Serif" size=1>2002</FONT></TH>
<TH>&nbsp;</TH></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>REVENUES:</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="12%"><FONT face="Times New Roman, Times, Serif" size=2></FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="12%"><FONT face="Times New Roman, Times, Serif" size=2></FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="12%"><FONT face="Times New Roman, Times, Serif" size=2></FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Investment banking</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>15,779,505</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>14,254,693</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>12,809,840</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Trading profits</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,358,959</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>312,657</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>288,834</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Interest and other</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>83,870</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>60,793</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>91,308</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>17,222,334</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>14,628,143</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>13,189,982</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2><B>EXPENSES:</B></FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Employee compensation and benefits</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>9,963,888</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>7,452,723</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>6,563,459</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Clearing fees</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>122,448</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>31,847</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>38,349</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Communications</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>356,939</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>243,327</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>189,414</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Occupancy</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>477,668</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>504,524</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>440,804</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Professional fees</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>744,635</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>641,219</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>398,746</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Interest</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>110,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>120,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>120,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>General and administrative</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,952,983</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,756,607</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,823,022</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>13,728,561</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>10,750,247</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>9,573,794</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Net Income</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>3,493,773</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>3,877,896</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>3,616,188</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left>&nbsp;</TD></TR></TABLE>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>See Notes to Financial Statements </FONT></P>
<P align=center><FONT face="Times New Roman, Times, serif" size=2>F-20</FONT></P>
<HR noShade SIZE=5>

<P style="PAGE-BREAK-BEFORE: always">
<P align=center><FONT face="Times New Roman, Times, Serif" size=2><B><A name=a13></A>SIEBERT, BRANDFORD, SHANK &amp; CO., L.L.C.<A name=a11></A></B></FONT></P>
<P align=center><FONT face="Times New Roman, Times, Serif" size=2><B>STATEMENTS OF CHANGES IN MEMBERS&#146; CAPITAL </B></FONT></P>
<TABLE cellSpacing="0" cellPadding="0" width="600" border="0">

<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>BALANCE - JANUARY 1, 2002</FONT></TD>
<TD align=right width="2%"><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right width="10%"><FONT face="Times New Roman, Times, Serif" size=2>5,359,925</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Distribution to member</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(3,435,540</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Net income</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>3,616,188</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>BALANCE - DECEMBER 31, 2002</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>5,540,573</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Distributions to member</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(2,955,633</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Net income</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>3,877,896</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>BALANCE - DECEMBER 31, 2003</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>6,462,836</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Distributions to members</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(2,512,219</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Net income</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>3,493,773</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>BALANCE - DECEMBER 31, 2004</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>7,444,390</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left>&nbsp;</TD></TR></TABLE>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>See Notes to Financial Statements</FONT></P>
<P align=center><FONT face="Times New Roman, Times, serif" size=2>F-21</FONT></P>
<HR noShade SIZE=5>

<P style="PAGE-BREAK-BEFORE: always">
<P align=center><FONT face="Times New Roman, Times, Serif" size=2><B>SIEBERT, BRANDFORD, SHANK &amp; CO., L.L.C.<A name=a12></A></B></FONT></P>
<P align=center><FONT face="Times New Roman, Times, Serif" size=2><B>STATEMENTS OF CASH FLOWS</B></FONT></P>
<TABLE cellSpacing="0" cellPadding="0" width=800 border="0">

<TR vAlign=bottom>
<TH>&nbsp;</TH>
<TH colSpan=8><FONT face="Times New Roman, Times, Serif" size=1>YEAR ENDED DECEMBER 31,</FONT></TH>
<TH>&nbsp;</TH></TR>
<TR vAlign=bottom>
<TH colSpan=9>
<HR noShade SIZE=1>
</TH>
<TH>&nbsp;</TH></TR>
<TR vAlign=bottom>
<TH>&nbsp;</TH>
<TH colSpan=2><FONT face="Times New Roman, Times, Serif" size=1>2004</FONT></TH>
<TH>&nbsp;</TH>
<TH colSpan=2><FONT face="Times New Roman, Times, Serif" size=1>2003</FONT></TH>
<TH>&nbsp;</TH>
<TH colSpan=2><FONT face="Times New Roman, Times, Serif" size=1>2002</FONT></TH>
<TH>&nbsp;</TH></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>CASH FLOWS FROM OPERATING ACTIVITIES:</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="9%"><FONT face="Times New Roman, Times, Serif" size=2></FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="9%"><FONT face="Times New Roman, Times, Serif" size=2></FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="9%"><FONT face="Times New Roman, Times, Serif" size=2></FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Net income</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>3,493,773</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>3,877,896</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>3,616,188</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Adjustments to reconcile net income to net cash provided by operating
activities:</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Depreciation and amortization</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>46,498</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>52,078</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>45,737</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Changes in:</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Securities owned, at market value</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>5,276</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>763,589</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,286,841</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts receivable</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(1,119,783</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>155,832</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,170,585</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Receivable from broker-dealers</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(434</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(7,044</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other assets</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(67,708</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(119,577</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(32,727</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Receivable to/payable from member</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>86,152</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>6,764</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(43,378</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts payable and accrued expenses</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,085,165</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>545,470</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>216,580</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Payable to broker-dealer&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(246,044</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>239,140</FONT></TD>
<TD align=left>&nbsp;</TD></TR>
<TR>
<TD></TD>
<TD colSpan=3></TD>
<TD colSpan=3></TD>
<TD colSpan=3></TD></TR>
<TR>
<TD></TD>
<TD colSpan=3></TD>
<TD colSpan=3></TD>
<TD colSpan=3></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net cash provided
by operating activities</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>3,528,939</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>5,028,964</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>6,498,966</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR>
<TD></TD>
<TD colSpan=3></TD>
<TD colSpan=3></TD>
<TD colSpan=3></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><B><FONT face="Times New Roman, Times, Serif" size=2>CASH FLOWS FROM INVESTING ACTIVITIES:</FONT></B></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Purchase of property and equipment</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(121,346</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(89,340</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(49,531</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><B><FONT face="Times New Roman, Times, Serif" size=2>CASH FLOWS FROM FINANCING ACTIVITIES:</FONT></B></TD></TR>
<TR>
<TD></TD>
<TD colSpan=3></TD>
<TD colSpan=3></TD>
<TD colSpan=3></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Distributions to members</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(2,512,219</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(2,955,633</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(3,435,540</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>NET INCREASE IN CASH AND CASH EQUIVALENTS</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>895,374</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>1,983,982</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>3,013,895</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Cash and cash equivalents - beginning of year</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>8,157,676</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>6,173,694</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>3,159,799</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>CASH AND CASH EQUIVALENTS - END OF YEAR</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>9,053,050</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>8,157,676</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>6,173,694</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=right>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Taxes paid</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>120,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>117,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>235,297</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Interest paid</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>110,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>120,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>120,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR></TABLE>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>See Notes to Financial Statements</B></FONT></P><B></B>
<P align=center><FONT face="Times New Roman, Times, serif" size=2>F-22</FONT></P>
<HR noShade SIZE=5>

<P style="PAGE-BREAK-BEFORE: always">
<P align=center><FONT face="Times New Roman, Times, Serif" size=2><B>SIEBERT, BRANDFORD, SHANK &amp; CO., L.L.C.</B></FONT></P>
<P align=center><FONT face="Times New Roman, Times, Serif" size=2><B>NOTES TO FINANCIAL STATEMENTS<BR></B></FONT><FONT face="Times New Roman, Times, Serif" size=2><B>DECEMBER 31, 2004</B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>NOTE A - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES </B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>[1]&nbsp; ORGANIZATION AND BASIS OF PRESENTATION: </B></FONT></P>
<TABLE cellSpacing="0" cellPadding="0" width="100%" border="0">

<TR>
<TD vAlign=top width=33>&nbsp;</TD>
<TD vAlign=top><FONT face="Times New Roman, Times, Serif" size=2>Siebert, Brandford, Shank &amp; Co., L.L.C. (&#147;SBS&#148; or the &#147;Company&#148;) was formed
on March 10, 1997 to engage in the business of tax-exempt underwriting and related trading activities.
The Company qualifies as a Minority and Women&#146;s Business Enterprise in certain states. </FONT></TD></TR>
<TR>
<TD vAlign=top></TD>
<TD vAlign=top>&nbsp;</TD></TR>
<TR>
<TD vAlign=top width=33>&nbsp;</TD>
<TD vAlign=top><FONT face="Times New Roman, Times, Serif" size=2>The Company was formed to succeed the tax-exempt underwriting activities business of the Siebert, Brandford,
Shank Division of Muriel Siebert &amp; Co., Inc. (&#147;Siebert&#148;), and commenced operations
on July 1, 1998. Two individuals (the &#147;Principals&#148;) and Siebert are the equity members
of the Company. The business arrangement provides that profits will be shared 51% to the Principals
and 49% to Siebert. </FONT></TD></TR></TABLE>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>[2]&nbsp; SECURITIES TRANSACTIONS: </B></FONT></P>
<TABLE cellSpacing="0" cellPadding="0" width="100%" border="0">

<TR>
<TD vAlign=top width=33>&nbsp;</TD>
<TD vAlign=top><FONT face="Times New Roman, Times, Serif" size=2>Securities transactions, commissions, revenues and expenses are recorded on a trade date basis. Securities
owned are valued at market value. </FONT></TD></TR>
<TR>
<TD vAlign=top></TD>
<TD vAlign=top>&nbsp;</TD></TR>
<TR>
<TD vAlign=top width=33>&nbsp;</TD>
<TD vAlign=top><FONT face="Times New Roman, Times, Serif" size=2>Dividends are recorded on the ex-dividend date, and interest income is recognized on an accrual basis.
</FONT></TD></TR></TABLE>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>[3]&nbsp; INVESTMENT BANKING: </B></FONT></P>
<TABLE cellSpacing="0" cellPadding="0" width="100%" border="0">

<TR>
<TD vAlign=top width=33>&nbsp;</TD>
<TD vAlign=top><FONT face="Times New Roman, Times, Serif" size=2>Investment banking revenues include gains and fees, net of syndicate expenses, arising primarily from
municipal bond offerings in which the Company acts as an underwriter or agent. Investment banking
management fees are recorded on offering date, sales concessions on settlement date, and underwriting
fees at the time the underwriting is completed and the income is reasonably determinable. </FONT></TD></TR></TABLE>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>[4]&nbsp;&nbsp;FURNITURE, EQUIPMENT AND LEASEHOLD IMPROVEMENTS, NET: </B></FONT></P>
<TABLE cellSpacing="0" cellPadding="0" width="100%" border="0">

<TR>
<TD vAlign=top width=33>&nbsp;</TD>
<TD vAlign=top><FONT face="Times New Roman, Times, Serif" size=2>Furniture and equipment is stated at cost and depreciation is calculated using the straight-line method
over the lives of the assets, generally five years. Leasehold improvements are amortized over the
period of the lease. </FONT></TD></TR>
<TR>
<TD>&nbsp;</TD>
<TD>&nbsp;</TD></TR>
<TR>
<TD colSpan=2><STRONG><FONT size=2>[5]&nbsp; CASH EQUIVALENTS: </FONT></STRONG>&nbsp;</TD></TR>
<TR>
<TD>&nbsp;</TD>
<TD>&nbsp;</TD></TR>
<TR>
<TD>&nbsp;</TD>
<TD><FONT face="Times New Roman, Times, Serif" size=2>For purposes of reporting cash flows, cash equivalents include money market funds. </FONT></TD></TR></TABLE>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>[6]&nbsp; USE OF ESTIMATES: </B></FONT></P>
<TABLE cellSpacing="0" cellPadding="0" width="100%" border="0">

<TR>
<TD vAlign=top width=33>&nbsp;</TD>
<TD vAlign=top><FONT face="Times New Roman, Times, Serif" size=2>The preparation of financial statements in conformity with accounting principles generally accepted
in the United States of America requires management to make estimates and assumptions that affect
the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities
at the date of the financial statements and the reported amounts of revenues and expenses during
the reporting period. Actual results could differ from those estimates. </FONT></TD></TR></TABLE>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>[7]&nbsp; INCOME TAXES: </B></FONT></P>
<TABLE cellSpacing="0" cellPadding="0" width="100%" border="0">

<TR>
<TD vAlign=top width=33>&nbsp;</TD>
<TD vAlign=top><FONT face="Times New Roman, Times, Serif" size=2>The Company is not subject to federal income taxes. Instead, the members are required to include in
their income tax returns their respective share of the Company&#146;s income. The Company is subject
to tax in certain state and local jurisdictions. </FONT></TD></TR></TABLE>
<P align=center><FONT face="Times New Roman, Times, serif" size=2>F-23</FONT></P>
<HR noShade SIZE=5>

<P style="PAGE-BREAK-BEFORE: always">
<P align=center><FONT face="Times New Roman, Times, Serif" size=2><B>SIEBERT, BRANDFORD, SHANK &amp; CO., L.L.C.</B></FONT></P>
<P align=center><FONT face="Times New Roman, Times, Serif" size=2><B>NOTES TO FINANCIAL STATEMENTS<BR></B></FONT><FONT face="Times New Roman, Times, Serif" size=2><B>DECEMBER 31, 2004</B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>NOTE B - SUBORDINATED BORROWINGS AND SECURED DEMAND NOTE RECEIVABLE </B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>The subordinated debt at December 31, 2004 and 2003 consist of a Secured Demand Note Collateral Agreement,
as amended, payable to Siebert, in the amount of $1,200,000, bearing interest at 8% and due August
31, 2006. Interest expense paid to Siebert for each of 2004, 2003 and 2002 amounts to $110,000, $120,000
and $120,000, respectively. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>The subordinated borrowings are available in computing net capital under the Securities and Exchange
Commission&#146;s (the &#147;SEC&#148;) Uniform Net Capital Rule. To the extent that such borrowing
is required for the Company&#146;s continued compliance with minimum net capital requirements, it
may not be repaid. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>The secured demand note receivable of $1,200,000 is collateralized by cash equivalents of Siebert of
approximately $1,300,000 at December 31, 2004. Interest earned on the collateral amounted to approximately
$22,000, $18,000 and $31,000 in 2004, 2003 and 2002, respectively. </FONT></P>
<TABLE cellSpacing="0" cellPadding="0" width="100%" border="0">

<TR>
<TD vAlign=top width=6>&nbsp;</TD>
<TD vAlign=top><FONT face="Times New Roman, Times, Serif" size=2><B>NOTE C - FURNITURE, EQUIPMENT AND LEASEHOLD IMPROVEMENTS, NET </B></FONT></TD></TR>
<TR>
<TD vAlign=top></TD>
<TD vAlign=top>&nbsp;</TD></TR>
<TR>
<TD vAlign=top width=6>&nbsp;</TD>
<TD vAlign=top><FONT face="Times New Roman, Times, Serif" size=2>Furniture, equipment and leasehold improvements consist of the following: </FONT></TD></TR></TABLE><BR>
<TABLE cellSpacing="0" cellPadding="0" width="600" border="0">

<TR vAlign=bottom>
<TH><FONT face="Times New Roman, Times, Serif" size=1></FONT></TH>
<TH colSpan=2><FONT face="Times New Roman, Times, Serif" size=1>2004</FONT></TH>
<TH>&nbsp;</TH>
<TH colSpan=2><FONT face="Times New Roman, Times, Serif" size=1>2003</FONT></TH>
<TH>&nbsp;</TH></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Equipment</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right width="12%"><FONT face="Times New Roman, Times, Serif" size=2>360,214</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right width="12%"><FONT face="Times New Roman, Times, Serif" size=2>267,448</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Furniture and fixtures</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>110,600</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>82,020</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR>
<TD></TD>
<TD colSpan=3></TD>
<TD colSpan=3></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>470,814</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>349,468</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Less accumulated depreciation and amortization</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(267,116</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>(220,618</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>)</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>203,698</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>128,850</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left>&nbsp;</TD></TR></TABLE>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>NOTE D - NET CAPITAL </B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>The Company is subject to the SEC&#146;s Uniform Net Capital Rule 15c3-1, which requires the maintenance
of minimum net capital and requires that the ratio of aggregate indebtedness to net capital, both
as defined, shall not exceed 15 to 1. At December 31, 2004 and 2003, the Company had net capital
of $7,916,000 and $7,083,000, respectively, which was $7,671,000 and $6,915,000, respectively, in
excess of its required net capital, and its ratio of aggregate indebtedness to net capital was .35
to 1 and .31 to 1, respectively. The Company claims exemption from the reserve requirements under
Section 15c-3-3(k)(2)(ii). </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Subsequent to December 31, 2003, the Company distributed $800,000 to its members. </FONT></P>
<P align=center><FONT face="Times New Roman, Times, serif" size=2>F-24</FONT></P>
<HR noShade SIZE=5>

<P style="PAGE-BREAK-BEFORE: always">
<P align=center><FONT face="Times New Roman, Times, Serif" size=2><B>SIEBERT, BRANDFORD, SHANK &amp; CO., L.L.C.</B></FONT></P>
<P align=center><FONT face="Times New Roman, Times, Serif" size=2><B>NOTES TO FINANCIAL STATEMENTS<BR></B></FONT><FONT face="Times New Roman, Times, Serif" size=2><B>DECEMBER 31, 2004</B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>NOTE E - COMMITMENTS AND CONTINGENCY </B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>The Company rents office space under long-term operating leases expiring through 2013. These leases
call for base rent plus escalations for taxes and operating expenses. Future minimum base rent under
these operating leases are as follows: </FONT></P>
<TABLE cellSpacing="0" cellPadding="0" width="600" border="0">

<TR vAlign=bottom>
<TH align=left><FONT face="Times New Roman, Times, Serif" size=1><U>YEAR</U></FONT></TH>
<TH colSpan=2><FONT face="Times New Roman, Times, Serif" size=1><U>AMOUNT</U></FONT></TH>
<TH>&nbsp;</TH></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left width=0%><FONT face="Times New Roman, Times, Serif" size=2>2005</FONT></TD>
<TD align=right width="1%"><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right width="10%"><FONT face="Times New Roman, Times, Serif" size=2>447,000</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>2006</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>268,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>2007</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>268,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>2008</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>278,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>2009</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>255,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Thereafter</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>561,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=1>
</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>$</FONT></TD>
<TD align=right><FONT face="Times New Roman, Times, Serif" size=2>2,077,000</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=right colSpan=2>
<HR noShade SIZE=2>
</TD>
<TD align=left>&nbsp;</TD></TR></TABLE>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>Rent expense including taxes and operating expenses for 2004, 2003 and 2002 amounted to $477,668, $504,524
and $440,804, respectively. </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2><B>NOTE F - OTHER </B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>During each of 2004, 2003 and 2002, the Company was charged $240,000 by Siebert for rent and general
and administrative services. </FONT></P>
<P align=center><FONT face="Times New Roman, Times, serif" size=2>F-25</FONT></P>
<HR noShade SIZE=5>

<P style="PAGE-BREAK-BEFORE: always">
<P align=center><FONT face="Times New Roman, Times, Serif" size=2><B>SIGNATURES</B></FONT></P>
<P><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT face="Times New Roman, Times, Serif" size=2>In accordance with Section 13 or 15(d) of the Exchange Act, the registrant caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized. </FONT></P>
<P align=center><FONT face="Times New Roman, Times, Serif" size=2><B>SIEBERT FINANCIAL CORP.</B></FONT></P>
<TABLE cellSpacing="0" cellPadding="0" width="100%" border="0">

<TR>
<TD width="50%">&nbsp;</TD>
<TD width="4%"><FONT face="Times New Roman, Times, Serif" size=2><U>By:</U></FONT></TD>
<TD><FONT face="Times New Roman, Times, Serif" size=2><U>/s/ MURIEL F. SIEBERT</U></FONT></TD></TR>
<TR>
<TD><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR>
<TD>&nbsp;</TD>
<TD>&nbsp;</TD>
<TD><FONT face="Times New Roman, Times, Serif" size=2>Muriel F. Siebert</FONT></TD></TR>
<TR>
<TD>&nbsp;</TD>
<TD>&nbsp;</TD>
<TD><FONT face="Times New Roman, Times, Serif" size=2>Chair and President</FONT></TD></TR>
<TR>
<TD><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD>
<TD><FONT face="Times New Roman, Times, serif" size=2>&nbsp;</FONT></TD></TR>
<TR>
<TD>&nbsp;</TD>
<TD><FONT face="Times New Roman, Times, Serif" size=2>Date:</FONT></TD>
<TD><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;March 31, 2005</FONT></TD></TR></TABLE>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>In accordance with the Exchange Act, this report has been signed below by the following persons on
behalf of the registrant and in the capacities and on the dates indicated. </FONT></P>
<TABLE cellSpacing="0" cellPadding="0" width="100%" border="0">

<TR vAlign=bottom align=left>
<TH colSpan=2><FONT face="Times New Roman, Times, Serif" size=1>Name</FONT></TH>
<TH colSpan=2><FONT face="Times New Roman, Times, Serif" size=1>Title</FONT></TH>
<TH colSpan=2><FONT face="Times New Roman, Times, Serif" size=1>Date</FONT></TH></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left width="32%"><FONT face="Times New Roman, Times, Serif" size=2>/s/ MURIEL F. SIEBERT</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left width="39%"><FONT face="Times New Roman, Times, Serif" size=2>Chair, President and Director</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left width="19%"><FONT face="Times New Roman, Times, Serif" size=2>March 31, 2005</FONT></TD>
<TD align=left width="2%"><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>(principal executive officer)</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Muriel F. Siebert</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>/s/ NICHOLAS P. DERMIGNY</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Executive Vice President,</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>March 31, 2005</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Chief Operating Officer and</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Nicholas P. Dermigny</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Director</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>/s/ JOSEPH M. RAMOS, JR.</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Chief Financial Officer</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>March 31, 2005</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>and Assistant Secretary</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>JOSEPH M. RAMOS, JR.</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>(principal financial and</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;accounting officer)</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>/s/ PATRICIA L. FRANCY</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Director</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>March 31, 2005</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR>
<TD colSpan=2><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT></TD>
<TD colSpan=2></TD>
<TD align=right>&nbsp;</TD>
<TD></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Patricia L. Francy</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>/s/ LEONARD M. LEIMAN</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Director</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>March 31, 2005</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR>
<TD colSpan=2><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT></TD>
<TD colSpan=2></TD>
<TD align=right>&nbsp;</TD>
<TD></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Leonard M. Leiman</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR>
<TD colSpan=2></TD>
<TD colSpan=2></TD>
<TD align=right>&nbsp;</TD>
<TD></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>/s/ JANE H. MACON</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Director</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>March 31, 2005</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR>
<TD colSpan=2><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT></TD>
<TD colSpan=2></TD>
<TD align=right>&nbsp;</TD>
<TD></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Jane H. Macon</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>/s/ ROBERT P. Mazzarella</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Director</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>March 31, 2005</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR>
<TD colSpan=2><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT></TD>
<TD colSpan=2></TD>
<TD align=right>&nbsp;</TD>
<TD></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Robert P. Mazzarella</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR>
<TD colSpan=2></TD>
<TD colSpan=2></TD>
<TD align=right>&nbsp;</TD>
<TD></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>/s/ NANCY S. PETERSON</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Director</FONT></TD>
<TD align=left>&nbsp;</TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>March 31, 2005</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR>
<TD colSpan=2><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT><FONT face="Times New Roman, Times, Serif" size=2>&#151;</FONT></TD>
<TD colSpan=2></TD>
<TD align=right>&nbsp;</TD>
<TD></TD></TR>
<TR vAlign=bottom>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>Nancy S. Peterson</FONT></TD>
<TD align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;</FONT></TD></TR>
<TR vAlign=bottom>
<TD align=left>&nbsp;</TD>
<TD align=left>&nbsp;</TD></TR></TABLE>
<HR noShade SIZE=5>

<P style="PAGE-BREAK-BEFORE: always">
<P align=center><FONT face="Times New Roman, Times, Serif" size=2><B>EXHIBIT INDEX</B></FONT></P>
<TABLE cellSpacing="0" cellPadding="0" width="100%" border="0">

<TR>
<TD vAlign=top noWrap align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2><B>EXHIBIT NO.</B></FONT></TD>
<TD vAlign=top align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2><B>DESCRIPTION OF DOCUMENT</B></FONT></TD></TR>
<TR>
<TD vAlign=top align="CENTER" width="12%">&nbsp;</TD>
<TD vAlign=top>&nbsp;</TD></TR>
<TR>
<TD vAlign=top align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>2.1</FONT></TD>
<TD vAlign=top><FONT face="Times New Roman, Times, Serif" size=2>Plan and Agreement of Merger between J. Michaels,Inc. (&#147;JMI&#148;) and Muriel Siebert Capital
Markets Group, Inc. (&#147;MSCMG&#148;), dated as of April 24, 1996&nbsp;(&#147;Merger Agreement&#148;)
(incorporated by reference to Siebert Financial Corp.&#146;s Form 10-K for the </FONT><FONT face="Times New Roman, Times, Serif" size=2>fiscal year ended December 31, 1996)</FONT></TD></TR>
<TR>
<TD vAlign=top align="CENTER">&nbsp;</TD>
<TD vAlign=top>&nbsp;</TD></TR>
<TR>
<TD vAlign=top align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>2.2</FONT></TD>
<TD vAlign=top><FONT face="Times New Roman, Times, Serif" size=2>Amendment No. 1 to Merger Agreement, dated as of June 28, 1996 (incorporated by reference to Siebert
Financial Corp.&#146;s Form 10-K for the fiscal year ended December 31, 1996)</FONT></TD></TR>
<TR>
<TD vAlign=top align="CENTER">&nbsp;</TD>
<TD vAlign=top>&nbsp;</TD></TR>
<TR>
<TD vAlign=top align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>2.3</FONT></TD>
<TD vAlign=top><FONT face="Times New Roman, Times, Serif" size=2>Amendment No. 2 to Merger Agreement, dated as of September 30, 1996 (incorporated by reference to Siebert
Financial Corp.&#146;s Form 10-K for the fiscal year ended December 31, 1996)</FONT></TD></TR>
<TR>
<TD vAlign=top align="CENTER">&nbsp;</TD>
<TD vAlign=top>&nbsp;</TD></TR>
<TR>
<TD vAlign=top align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>2.4</FONT></TD>
<TD vAlign=top><FONT face="Times New Roman, Times, Serif" size=2>Amendment No. 3 to Merger Agreement, dated as of November 7, 1996 (incorporated by reference to Siebert
Financial Corp.&#146;s Form 10-K for the fiscal year ended December 31, 1996)</FONT></TD></TR>
<TR>
<TD vAlign=top align="CENTER">&nbsp;</TD>
<TD vAlign=top>&nbsp;</TD></TR>
<TR>
<TD vAlign=top align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>3.1</FONT></TD>
<TD vAlign=top><FONT face="Times New Roman, Times, Serif" size=2>Certificate of Incorporation of Siebert Financial Corp., formerly known as J. Michaels, Inc. originally
filed on April 9, 1934, as amended and restated to date (incorporated by reference to Siebert Financial
Corp.&#146;s Form 10-K for the fiscal year ended December 31, 1997)</FONT></TD></TR>
<TR>
<TD vAlign=top align="CENTER">&nbsp;</TD>
<TD vAlign=top>&nbsp;</TD></TR>
<TR>
<TD vAlign=top align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>3.2</FONT></TD>
<TD vAlign=top><FONT face="Times New Roman, Times, Serif" size=2>By-laws of Siebert Financial Corp. (incorporated by reference to Siebert Financial Corp.&#146;s Registration
Statement on Form S-1 (File No. 333-49843) filed with the&nbsp;Securities and Exchange Commission
on April 10, 1998)</FONT></TD></TR>
<TR>
<TD vAlign=top align="CENTER">&nbsp;</TD>
<TD vAlign=top>&nbsp;</TD></TR>
<TR>
<TD vAlign=top align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>10.1</FONT></TD>
<TD vAlign=top><FONT face="Times New Roman, Times, Serif" size=2>Siebert Financial Corp. 1998 Restricted Stock Award Plan (incorporated by reference to Siebert Financial

Corp.&#146;s Form 10-K for the fiscal year ended December 31, 1997)</FONT></TD></TR>
<TR>
<TD vAlign=top align="CENTER">&nbsp;</TD>
<TD vAlign=top>&nbsp;</TD></TR>
<TR>
<TD vAlign=top align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>10.2</FONT></TD>
<TD vAlign=top><FONT face="Times New Roman, Times, Serif" size=2>10(a) Siebert Financial Corp. 1997 Stock Option Plan (incorporated by reference to Siebert Financial
Corp.&#146;s Form 10-K for the fiscal year ended December 31, 1996)</FONT></TD></TR>
<TR>
<TD vAlign=top align="CENTER">&nbsp;</TD>
<TD vAlign=top>&nbsp;</TD></TR>
<TR>
<TD vAlign=top align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>10.4</FONT></TD>
<TD vAlign=top><FONT face="Times New Roman, Times, Serif" size=2>LLC Operating Agreement, among Siebert, Brandford, Shank &amp; Co., LLC, Muriel Siebert &amp; Co.,
Inc., Napoleon Brandford III and Suzanne F. Shank, dated as of March 10, 1997 (incorporated by reference
to Siebert Financial Corp.&#146;s Form 10-K for the fiscal year ended&nbsp;December 31, 1996)</FONT></TD></TR>
<TR>
<TD vAlign=top align="CENTER">&nbsp;</TD>
<TD vAlign=top>&nbsp;</TD></TR>
<TR>
<TD vAlign=top align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>10.5</FONT></TD>
<TD vAlign=top><FONT face="Times New Roman, Times, Serif" size=2>Services Agreement, between Siebert, Brandford, Shank &amp; Co., LLC and Muriel Siebert &amp; Co.,
Inc., dated as of March 10, 1997 (incorporated by reference to Siebert Financial Corp.&#146;s Form
10-K for the fiscal year ended December 31, 1996)</FONT></TD></TR>
<TR>
<TD vAlign=top align="CENTER">&nbsp;</TD>
<TD vAlign=top>&nbsp;</TD></TR>
<TR>
<TD vAlign=top align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>10.6</FONT></TD>
<TD vAlign=top><FONT face="Times New Roman, Times, Serif" size=2>Siebert Financial Corp. 1998 Restricted Stock Award Plan (incorporated by reference to Siebert Financial

Corp.&#146;s Form 10-K for the fiscal year ended December 31, 1997)</FONT></TD></TR>
<TR>
<TD vAlign=top align="CENTER">&nbsp;</TD>
<TD vAlign=top>&nbsp;</TD></TR>
<TR>
<TD vAlign=top align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>10.7</FONT></TD>
<TD vAlign=top><FONT face="Times New Roman, Times, Serif" size=2>Stock Option Agreement, dated March 11, 1997, between the Company and Patricia L. Francy (incorporated
by reference to Siebert Financial Corp.&#146;s Registration Statement on Form S-8 (File No. 333-72939)
filed with the Securities and Exchange Commission on February 25, 1999)</FONT></TD></TR>
<TR>
<TD vAlign=top align="CENTER">&nbsp;</TD>
<TD vAlign=top>&nbsp;</TD></TR>
<TR>
<TD vAlign=top align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>10.8</FONT></TD>
<TD vAlign=top><FONT face="Times New Roman, Times, Serif" size=2>Stock Option Agreement, dated March 11, 1997, between the Company and Jane H. Macon (incorporated by
reference to Siebert Financial Corp.&#146;s Registration Statement on Form S-8 (File No. 333-72939)
filed with the Securities and Exchange Commission on February 25, 1999)</FONT></TD></TR>
<TR>
<TD vAlign=top align="CENTER">&nbsp;</TD>
<TD vAlign=top>&nbsp;</TD></TR>
<TR>
<TD vAlign=top align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>10.9</FONT></TD>
<TD vAlign=top><FONT face="Times New Roman, Times, Serif" size=2>Stock Option Agreement, dated March 11, 1997, between the Company and Monte E. Wetzler (incorporated
by reference to Siebert Financial Corp.&#146;s Registration Statement on Form S-8 (File No. 333-72939)
filed with the Securities and Exchange Commission on February 25, 1999)</FONT></TD></TR>
<TR>
<TD vAlign=top align="CENTER">&nbsp;</TD>
<TD vAlign=top>&nbsp;</TD></TR>
<TR>
<TD vAlign=top align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>10.10</FONT></TD>
<TD vAlign=top><FONT face="Times New Roman, Times, Serif" size=2>Employment Agreement, dated as of April 9, 1999, between the Company and Daniel Jacobson</FONT> <FONT face="Times New Roman, Times, Serif" size=2>(incorporated by reference to Siebert FinancialCorp.&#146;s Form 10-Q for the quarter ended September</FONT> <FONT face="Times New Roman, Times, Serif" size=2>30, 1999)</FONT></TD></TR>
<TR>
<TD vAlign=top align="CENTER">&nbsp;</TD>
<TD vAlign=top>&nbsp;</TD></TR>
<TR>
<TD vAlign=top align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>10.11</FONT></TD>
<TD vAlign=top><FONT face="Times New Roman, Times, Serif" size=2>Strategic Alliance Agreement, dated as of April 29, 2002, by and between Intuit Inc, Muriel</FONT> <FONT face="Times New Roman, Times, Serif" size=2>Siebert &amp; Co., Inc. and Investment Solutions, Inc. (incorporated by reference to Siebert</FONT> <FONT face="Times New Roman, Times, Serif" size=2>Financial Corp.&#146;s Form 10-Q for the quarter ended June 30, 2002.)</FONT></TD></TR>
<TR>
<TD vAlign=top align="CENTER">&nbsp;</TD>
<TD vAlign=top>&nbsp;</TD></TR>
<TR>
<TD vAlign=top align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>10.12</FONT></TD>
<TD vAlign=top><FONT face="Times New Roman, Times, Serif" size=2>Fully Disclosed Clearing Agreement, dated April 30, 2002, by and between the&nbsp;Pershing Division
of Donaldson, Lufkin and Jenrette Securities Corporation and Muriel Siebert &amp; Co., Inc. (incorporated
by reference to Siebert Financial Corp.&#146;s Form 10-Q for the quarter ended June 30, 2002.)</FONT></TD></TR>
<TR>
<TD vAlign=top align="CENTER">&nbsp;</TD>
<TD vAlign=top>&nbsp;</TD></TR>
<TR>
<TD vAlign=top align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>21</FONT></TD>
<TD vAlign=top><FONT face="Times New Roman, Times, Serif" size=2>Subsidiaries of the registrant (incorporated by reference to Siebert Financial Corp.&#146;s Annual
Report on Form 10-K for the year ended December 31, 2001)</FONT></TD></TR>
<TR>
<TD vAlign=top align="CENTER">&nbsp;</TD>
<TD vAlign=top>&nbsp;</TD></TR>
<TR>
<TD vAlign=top align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>23</FONT></TD>
<TD vAlign=top><FONT face="Times New Roman, Times, Serif" size=2>Consent of Independent Auditors</FONT></TD></TR>
<TR>
<TD vAlign=top align="CENTER">&nbsp;</TD>
<TD vAlign=top>&nbsp;</TD></TR>
<TR>
<TD vAlign=top align="CENTER"><FONT face="Times New Roman, Times, Serif" size=2>31.1<FONT face="Times New Roman, Times, Serif" size=2></FONT></FONT></TD>
<TD vAlign=top><FONT face="Times New Roman, Times, Serif" size=2><FONT face="Times New Roman, Times, Serif" size=2></FONT>Certification of Muriel F. Siebert pursuant to Securities Exchange Act Rules 13a-14 and 15d-14, as
adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002</FONT></TD></TR>
<TR>
<TD vAlign=top align="CENTER">&nbsp;</TD>
<TD vAlign=top>&nbsp;</TD></TR></TABLE>
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<TR>
<TD vAlign=top width="4%"></TD>
<TD vAlign=top width="12%"><FONT face="Times New Roman, Times, Serif" size=2>31.2</FONT></TD>
<TD vAlign=top><FONT face="Times New Roman, Times, Serif" size=2>Certification of Joseph M. Ramos, Jr. pursuant to Securities Exchange Act Rules 13a-14 and 15d-14,
as adopted pursuant to Section 302 of the Sarbanes-Oxley act of 2002.</FONT></TD></TR>
<TR>
<TD vAlign=top></TD>
<TD vAlign=top>&nbsp;</TD>
<TD vAlign=top>&nbsp;</TD></TR>
<TR>
<TD vAlign=top></TD>
<TD vAlign=top><FONT face="Times New Roman, Times, Serif" size=2>32.1</FONT></TD>
<TD vAlign=top><FONT face="Times New Roman, Times, Serif" size=2>Certification of Muriel F. Siebert of Periodic Financial Report under Section 906 of the Sarbanes-Oxley
Act of 2002</FONT></TD></TR>
<TR>
<TD vAlign=top></TD>
<TD vAlign=top>&nbsp;</TD>
<TD vAlign=top>&nbsp;</TD></TR>
<TR>
<TD vAlign=top></TD>
<TD vAlign=top><FONT face="Times New Roman, Times, Serif" size=2>32.2</FONT></TD>
<TD vAlign=top><FONT face="Times New Roman, Times, Serif" size=2>Certification of Joseph M. Ramos, Jr. of Periodic Financial Report under Section 906 of the Sarbanes-Oxley
Act of 2002 </FONT></TD></TR>
<TR>
<TD vAlign=top></TD>
<TD vAlign=top>&nbsp;</TD>
<TD vAlign=top>&nbsp;</TD></TR></TABLE>
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<DOCUMENT>
<TYPE>EX-31
<SEQUENCE>2
<FILENAME>ex_31-1.htm
<DESCRIPTION>EXHIBIT 31.1
<TEXT>
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<P align=right><FONT face="Times New Roman, Times, Serif" size=2><B>Exhibit 31.1</B></FONT></P>
<P align=center><FONT face="Times New Roman, Times, Serif" size=2><B>CERTIFICATION<br>
  </B></FONT><FONT face="Times New Roman, Times, Serif" size=2><B>PURSUANT TO EXCHANGE ACT RULE 13A-14 AND 15D-14, <br>
</B></FONT><FONT face="Times New Roman, Times, Serif" size=2><B>AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002</B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>I, Muriel F. Siebert certify that: </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>1. &nbsp;I have reviewed this report on Form 10-K of Siebert Financial Corp.; </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>2. &nbsp;&nbsp;Based on my knowledge, this annual 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 annual report; </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>3. &nbsp;&nbsp;Based on my knowledge, the financial statements, and other financial information included in this annual 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 annual report; </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>4. &nbsp;The registrant&#146;s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have: </FONT></P>
<TABLE cellspacing="0" cellpadding="0" width="100%" border="0">
  <TR>
    <TD valign=top width=33>&nbsp;</TD>
    <TD valign=top><FONT face="Times New Roman, Times, Serif" size=2>(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 annual report is being prepared;</FONT></TD>
  </TR>
  <TR>
    <TD valign=top></TD>
    <TD valign=top>&nbsp;</TD>
  </TR>
  <TR>
    <TD valign=top width=33>&nbsp;</TD>
    <TD valign=top><FONT face="Times New Roman, Times, Serif" size=2>(b) Evaluated the effectiveness of the registrant&#146;s disclosure controls and procedures and presented in this annual report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and</FONT></TD>
  </TR>
  <TR>
    <TD valign=top></TD>
    <TD valign=top>&nbsp;</TD>
  </TR>
  <TR>
    <TD valign=top width=33>&nbsp;</TD>
    <TD valign=top><FONT face="Times New Roman, Times, Serif" size=2>(c)&nbsp;&nbsp;Disclosed in this annual report any change in the registrant&#146;s internal control over financial reporting that occurred during the registrant&#146;s most recent fiscal quarter (the registrant&#146;s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrants internal control over financial reporting;</FONT></TD>
  </TR>
</TABLE>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>5. &nbsp;The registrant&#146;s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant&#146;s auditors and the audit committee of the registrant&#146;s board of directors (or persons performing the equivalent functions): </FONT></P>
<TABLE cellspacing="0" cellpadding="0" width="100%" border="0">
  <TR>
    <TD valign=top width=33>&nbsp;</TD>
    <TD valign=top><FONT face="Times New Roman, Times, Serif" size=2>(a)&nbsp;&nbsp;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&#146;s ability to record, process, summarize and report financial information; and </FONT></TD>
  </TR>
  <TR>
    <TD valign=top></TD>
    <TD valign=top>&nbsp;</TD>
  </TR>
  <TR>
    <TD valign=top width=33>&nbsp;</TD>
    <TD valign=top><FONT face="Times New Roman, Times, Serif" size=2>(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant&#146;s internal control over financial reporting. </FONT></TD>
  </TR>
</TABLE>
<br>
<table width="100%"  border="0" cellspacing="0" cellpadding="0">
  <tr>
    <td width="50%"><FONT face="Times New Roman, Times, Serif" size=2>/s/ Muriel F. Siebert</FONT></td>
    <td width="8%" align="left">&nbsp;</td>
    <td align="left"><FONT face="Times New Roman, Times, Serif" size=2>Date: March 31, 2005</FONT></td>
  </tr>
  <tr>
    <td><FONT face="Times New Roman, Times, Serif" size=2>Muriel F. Siebert</FONT></td>
    <td colspan="2">&nbsp;</td>
  </tr>
  <tr>
    <td><FONT face="Times New Roman, Times, Serif" size=2>Chair and President</FONT></td>
    <td colspan="2">&nbsp;</td>
  </tr>
  <tr>
    <td><FONT face="Times New Roman, Times, Serif" size=2>(principal executive officer)</FONT></td>
    <td colspan="2">&nbsp;</td>
  </tr>
  <tr>
    <td>&nbsp;</td>
    <td colspan="2">&nbsp;</td>
  </tr>
</table>
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<TYPE>EX-31
<SEQUENCE>3
<FILENAME>ex_31-2.htm
<DESCRIPTION>EXHIBIT 31.2
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<P align=right><FONT face="Times New Roman, Times, Serif" size=2><B>Exhibit 31.2</B></FONT></P>
<P align=center><FONT face="Times New Roman, Times, Serif" size=2><B>CERTIFICATION<br>
  </B></FONT><FONT face="Times New Roman, Times, Serif" size=2><B>PURSUANT TO EXCHANGE ACT RULE 13A-14 AND 15D-14, <br>
</B></FONT><FONT face="Times New Roman, Times, Serif" size=2><B>AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002</B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>I, Joseph M. Ramos, Jr. certify that: </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>1. &nbsp;I have reviewed this report on Form 10-K of Siebert Financial Corp.; </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>2. &nbsp;&nbsp;Based on my knowledge, this annual 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 annual report; </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>3. &nbsp;&nbsp;Based on my knowledge, the financial statements, and other financial information included in this annual 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 annual report; </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>4. &nbsp;The registrant&#146;s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have: </FONT></P>
<TABLE cellspacing="0" cellpadding="0" width="100%" border="0">
  <TR>
    <TD valign=top width=33>&nbsp;</TD>
    <TD valign=top><FONT face="Times New Roman, Times, Serif" size=2>(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 annual report is being prepared;</FONT></TD>
  </TR>
  <TR>
    <TD valign=top></TD>
    <TD valign=top>&nbsp;</TD>
  </TR>
  <TR>
    <TD valign=top width=33>&nbsp;</TD>
    <TD valign=top><FONT face="Times New Roman, Times, Serif" size=2>(b) Evaluated the effectiveness of the registrant&#146;s disclosure controls and procedures and presented in this annual report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and</FONT></TD>
  </TR>
  <TR>
    <TD valign=top></TD>
    <TD valign=top>&nbsp;</TD>
  </TR>
  <TR>
    <TD valign=top width=33>&nbsp;</TD>
    <TD valign=top><FONT face="Times New Roman, Times, Serif" size=2>(c)&nbsp;&nbsp;Disclosed in this annual report any change in the registrant&#146;s internal control over financial reporting that occurred during the registrant&#146;s most recent fiscal quarter (the registrant&#146;s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrants internal control over financial reporting;</FONT></TD>
  </TR>
</TABLE>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>5. &nbsp;The registrant&#146;s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant&#146;s auditors and the audit committee of the registrant&#146;s board of directors (or persons performing the equivalent functions): </FONT></P>
<TABLE cellspacing="0" cellpadding="0" width="100%" border="0">
  <TR>
    <TD valign=top width=33>&nbsp;</TD>
    <TD valign=top><FONT face="Times New Roman, Times, Serif" size=2>(a)&nbsp;&nbsp;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&#146;s ability to record, process, summarize and report financial information; and </FONT></TD>
  </TR>
  <TR>
    <TD valign=top></TD>
    <TD valign=top>&nbsp;</TD>
  </TR>
  <TR>
    <TD valign=top width=33>&nbsp;</TD>
    <TD valign=top><FONT face="Times New Roman, Times, Serif" size=2>(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant&#146;s internal control over financial reporting. </FONT></TD>
  </TR>
</TABLE>
<br>
<table width="100%"  border="0" cellspacing="0" cellpadding="0">
  <tr>
    <td width="50%"><FONT face="Times New Roman, Times, Serif" size=2>/s/ Joseph M. Ramos, Jr.</FONT></td>
    <td width="8%" align="left">&nbsp;</td>
    <td align="left"><FONT face="Times New Roman, Times, Serif" size=2>Date: March 31, 2005</FONT></td>
  </tr>
  <tr>
    <td><FONT face="Times New Roman, Times, Serif" size=2>Joseph M. Ramos, Jr.</FONT></td>
    <td colspan="2">&nbsp;</td>
  </tr>
  <tr>
    <td><FONT face="Times New Roman, Times, Serif" size=2>Chief Financial Officer</FONT></td>
    <td colspan="2">&nbsp;</td>
  </tr>
  <tr>
    <td><FONT face="Times New Roman, Times, Serif" size=2>(principal financial and accounting officer)</FONT></td>
    <td colspan="2">&nbsp;</td>
  </tr>
  <tr>
    <td>&nbsp;</td>
    <td colspan="2">&nbsp;</td>
  </tr>
</table>

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<TYPE>EX-32
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<FILENAME>ex_32-1.htm
<DESCRIPTION>EXHIBIT 32.1
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<P align=right><FONT face="Times New Roman, Times, Serif" size=2>Exhibit 32.1</FONT></P>
<P align=center><FONT face="Times New Roman, Times, Serif" size=2><B>CERTIFICATION PURSUANT TO<br>
  </B></FONT><FONT face="Times New Roman, Times, Serif" size=2><B>18 U.S.C. SECTION 1350,<br>
  </B></FONT><FONT face="Times New Roman, Times, Serif" size=2><B>AS ADOPTED PURSUANT TO<br>
</B></FONT><FONT face="Times New Roman, Times, Serif" size=2><B>SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002</B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>In connection with the Annual Report of Siebert Financial Corp. (the &#147;Company&#148;) on Form 10-K for the year ended December 31, 2004, as filed with the Securities and Exchange Commission (the &#147;Report&#148;), I, Muriel F. Siebert, in my capacity as Chair and President of the Company, hereby certify, pursuant to 18 U.S.C. ss. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge: </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>(1)&nbsp;&nbsp;&nbsp;&nbsp;the Report filed by the Company with the Securities and Exchange Commission fully complies with the requirements of Section 13(a) of the Securities and Exchange Act of 1934; and </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>(2)&nbsp;&nbsp;&nbsp;&nbsp;the information&nbsp;contained in the Report fairly&nbsp;presents,&nbsp;in all material respects, the financial condition and results of operations of the Company for the period covered by the report. </FONT></P>
<table width="100%"  border="0" cellspacing="0" cellpadding="0">
  <tr>
    <td width="50%"><FONT face="Times New Roman, Times, Serif" size=2>/s/ Muriel F. Siebert</FONT></td>
    <td width="8%" align="left">&nbsp;</td>
    <td align="left"><FONT face="Times New Roman, Times, Serif" size=2>Date: March 31, 2005</FONT></td>
  </tr>
  <tr>
    <td><FONT face="Times New Roman, Times, Serif" size=2>Muriel F. Siebert</FONT></td>
    <td colspan="2">&nbsp;</td>
  </tr>
  <tr>
    <td><FONT face="Times New Roman, Times, Serif" size=2>Chair and President</FONT></td>
    <td colspan="2">&nbsp;</td>
  </tr>
</table>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>&nbsp;A signed original of this written statement required by Section 906, or other documents authenticating, acknowledging, or otherwise adopting the signature that appears in typed form within the electronic version of this written statement required by section 906, has been provided to Siebert Financial Corp. and will be retained by Siebert Financial Corp. and furnished to the Securities and Exchange Commission or its staff upon request.</FONT></P>
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<DOCUMENT>
<TYPE>EX-32
<SEQUENCE>5
<FILENAME>ex_32-2.htm
<DESCRIPTION>EXHIBIT 32.2
<TEXT>
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<P align=right><FONT face="Times New Roman, Times, Serif" size=2><B>Exhibit 32.2</B></FONT></P>
<P align=center><FONT face="Times New Roman, Times, Serif" size=2><B>CERTIFICATION PURSUANT TO<br>
  </B></FONT><FONT face="Times New Roman, Times, Serif" size=2><B>18 U.S.C. SECTION 1350,<br>
  </B></FONT><FONT face="Times New Roman, Times, Serif" size=2><B>AS ADOPTED PURSUANT TO<br>
</B></FONT><FONT face="Times New Roman, Times, Serif" size=2><B>SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002</B></FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>In connection with the Annual Report of Siebert Financial Corp. (the &#147;Company&#148;) on Form 10-K for the year ended December 31, 2004, as filed with the Securities and Exchange Commission (the &#147;Report&#148;), I, Joseph M. Ramos, Jr., in my capacity as Chief Financial Officer of the Company, hereby certify, pursuant to 18 U.S.C. ss. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge: </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>(1)&nbsp;&nbsp;&nbsp;&nbsp;the Report filed by the Company with the Securities and Exchange Commission fully complies with the requirements of Section 13(a) of the Securities and Exchange Act of 1934; and </FONT></P>
<P align=left><FONT face="Times New Roman, Times, Serif" size=2>(2)&nbsp;&nbsp;&nbsp;&nbsp;the information&nbsp;contained in the Report fairly&nbsp;presents,&nbsp;in all material respects, the financial condition and results of operations of the Company for the period covered by the report. </FONT></P>
<table width="100%"  border="0" cellspacing="0" cellpadding="0">
  <tr>
    <td width="50%"><FONT face="Times New Roman, Times, Serif" size=2>/s/ Joseph M. Ramos, Jr.</FONT></td>
    <td width="8%" align="left">&nbsp;</td>
    <td align="left"><FONT face="Times New Roman, Times, Serif" size=2>Date: March 31, 2005</FONT></td>
  </tr>
  <tr>
    <td><FONT face="Times New Roman, Times, Serif" size=2>Joseph M. Ramos, Jr.</FONT></td>
    <td colspan="2">&nbsp;</td>
  </tr>
  <tr>
    <td><FONT face="Times New Roman, Times, Serif" size=2>Chief Financial Officer</FONT></td>
    <td colspan="2">&nbsp;</td>
  </tr>
</table>
<P><FONT face="Times New Roman, Times, Serif" size=2>A signed original of this written statement required by Section 906, or other documents authenticating, acknowledging, or otherwise adopting the signature that appears in typed form within the electronic version of this written statement required by section 906, has been provided to Siebert Financial Corp. and will be retained by Siebert Fiancial Corp. and furnished to the Securities and Exchange Commission or its staff upon request.</FONT></P>
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