-----BEGIN PRIVACY-ENHANCED MESSAGE-----
Proc-Type: 2001,MIC-CLEAR
Originator-Name: webmaster@www.sec.gov
Originator-Key-Asymmetric:
 MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen
 TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB
MIC-Info: RSA-MD5,RSA,
 APbLHT/fOPsALTtDes2Fj17a+e//d+K6mx6GfAeTiM84O+Hw/4UvEGYNJzFPPPRa
 tHkaqMpO2nCOGVBMfLbJEQ==

<SEC-DOCUMENT>0001003297-07-000266.txt : 20071022
<SEC-HEADER>0001003297-07-000266.hdr.sgml : 20071022
<ACCEPTANCE-DATETIME>20071022172514
ACCESSION NUMBER:		0001003297-07-000266
CONFORMED SUBMISSION TYPE:	DEF 14A
PUBLIC DOCUMENT COUNT:		2
CONFORMED PERIOD OF REPORT:	20071204
FILED AS OF DATE:		20071022
DATE AS OF CHANGE:		20071022
EFFECTIVENESS DATE:		20071022

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			PRO DEX INC
		CENTRAL INDEX KEY:			0000788920
		STANDARD INDUSTRIAL CLASSIFICATION:	SURGICAL & MEDICAL INSTRUMENTS & APPARATUS [3841]
		IRS NUMBER:				841261240
		STATE OF INCORPORATION:			CO
		FISCAL YEAR END:			0630

	FILING VALUES:
		FORM TYPE:		DEF 14A
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	000-14942
		FILM NUMBER:		071183784

	BUSINESS ADDRESS:	
		STREET 1:		MICRO MOTORS, INC.
		STREET 2:		151 EAST COLUMBINE
		CITY:			SANTA ANA
		STATE:			CA
		ZIP:			92707
		BUSINESS PHONE:		714-241-4411

	MAIL ADDRESS:	
		STREET 1:		MICRO MOTORS INC.
		STREET 2:		151 EAST COLUMBINE
		CITY:			SANTA ANA
		STATE:			CA
		ZIP:			92707
</SEC-HEADER>
<DOCUMENT>
<TYPE>DEF 14A
<SEQUENCE>1
<FILENAME>espdexproxy1.htm
<TEXT>
<html>

<head>
<!-- Document Prepared With EDGARSTAR Software-->
<!-- Copyright 2007 EDGARSTAR TRADEMARK-->
<!-- All rights reserved EDGAR2.com -->





<title>Pro-Dex, Inc. DEF-14A</title>



</head>

<body lang=EN-US link=blue vlink=purple>

<table border="0" style="border-collapse: collapse" width="100%" id="table2">
	<tr>
		<td style="border-left: 1px solid #000000; border-right: 1px solid #000000" colspan="2">
		<div style="border-top: 1px solid #000000">
		<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>
		</div>
		</td>
	</tr>
	<tr>
		<td style="border-left: 1px solid #000000; border-right: 1px solid #000000" colspan="2">
		<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>
		</td>
	</tr>
	<tr>
		<td style="border-left: 1px solid #000000; border-right: 1px solid #000000" colspan="2">
		<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;page-break-after:avoid;text-autospace:none;font-family:"Times New Roman";font-weight:bold'>
		<font size="4">SCHEDULE 14A INFORMATION</font></p></td>
	</tr>
	<tr>
		<td style="border-left: 1px solid #000000; border-right: 1px solid #000000" colspan="2">
		<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;page-break-after:avoid;text-autospace:none;font-family:"Times New Roman";font-weight:bold'>Proxy Statement Pursuant to Section
14(a) of the Securities Exchange Act of 1934 </p></td>
	</tr>
	<tr>
		<td style="border-left: 1px solid #000000; border-right: 1px solid #000000" colspan="2">
		<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman"'>
		Filed by the Registrant <font face="Wingdings">x</font></p>
		</td>
	</tr>
	<tr>
		<td style="border-left: 1px solid #000000; border-right: 1px solid #000000" colspan="2">
		<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:0in'>
		Filed by a Party other than the Registrant
		<font face="Wingdings">o</font></p></td>
	</tr>
	<tr>
		<td style="border-left: 1px solid #000000; border-right: 1px solid #000000" colspan="2">
		<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman"'>Check the appropriate box:</p>
		</td>
	</tr>
	<tr>
		<td style="border-left: 1px solid #000000; border-right: medium none #000000; ; border-top-style:none; border-top-width:medium; border-bottom-style:none; border-bottom-width:medium" width="5%" valign="top" height="22">
		<font face="Wingdings">o</font></td>
		<td style="border-left: medium none #000000; border-right: 1px solid #000000; ; border-top-style:none; border-top-width:medium; border-bottom-style:none; border-bottom-width:medium" width="95%" valign="top" height="22">
		Preliminary Proxy Statement</td>
	</tr>
	<tr>
		<td style="border-left: 1px solid #000000; border-right: medium none #000000; ; border-top-style:none; border-top-width:medium; border-bottom-style:none; border-bottom-width:medium" width="5%" valign="top" height="22">
		<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:0in'>
		<font face="Wingdings">o</font></p></td>
		<td style="border-left: medium none #000000; border-right: 1px solid #000000; ; border-top-style:none; border-top-width:medium; border-bottom-style:none; border-bottom-width:medium" width="95%" valign="top" height="22">
		Confidential, for Use of the Commission Only (as
permitted by Rule 14a-6(e)(2))</td>
	</tr>
	<tr>
		<td style="border-left: 1px solid #000000; border-right: medium none #000000; ; border-top-style:none; border-top-width:medium; border-bottom-style:none; border-bottom-width:medium" width="5%" valign="top">
		<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:0in'>
		<font face="Wingdings">x</font></p>
		</td>
		<td style="border-left: medium none #000000; border-right: 1px solid #000000; ; border-top-style:none; border-top-width:medium; border-bottom-style:none; border-bottom-width:medium" width="95%" valign="top">
		Definitive Proxy Statement</td>
	</tr>
	<tr>
		<td style="border-left: 1px solid #000000; border-right: medium none #000000; ; border-top-style:none; border-top-width:medium; border-bottom-style:none; border-bottom-width:medium" width="5%" valign="top">
		<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:0in'>
		<font face="Wingdings">o</font></p>
		</td>
		<td style="border-left: medium none #000000; border-right: 1px solid #000000; ; border-top-style:none; border-top-width:medium; border-bottom-style:none; border-bottom-width:medium" width="95%" valign="top">
		Definitive Additional Materials</td>
	</tr>
	<tr>
		<td style="border-left: 1px solid #000000; border-right: medium none #000000; ; border-top-style:none; border-top-width:medium; border-bottom-style:none; border-bottom-width:medium" width="5%" valign="top">
		<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:0in'>
		<font face="Wingdings">o</font></p></td>
		<td style="border-left: medium none #000000; border-right: 1px solid #000000; ; border-top-style:none; border-top-width:medium; border-bottom-style:none; border-bottom-width:medium" width="95%" valign="top">
		Soliciting Material Pursuant to &#61479;
240.14a-11(c) or &#61479; 240.14a-12</td>
	</tr>
	<tr>
		<td style="border-left: 1px solid #000000; border-right: 1px solid #000000" colspan="2" height="47">
		<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:.25in;text-align:center'>
		<u>&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; PRO-DEX,
INC.&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;
		</u></p></td>
	</tr>
	<tr>
		<td style="border-left: 1px solid #000000; border-right: 1px solid #000000" colspan="2">
		<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;page-break-after:avoid;text-autospace:none;font-family:"Times New Roman";margin-top:0in'>(Name of
Registrant as Specified In Its Charter)</p></td>
	</tr>
	<tr>
		<td style="border-left: 1px solid #000000; border-right: 1px solid #000000" colspan="2">
		<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman"'>
		<u>&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;&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;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbs
p;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
		</u></p></td>
	</tr>
	<tr>
		<td style="border-left: 1px solid #000000; border-right: 1px solid #000000" colspan="2">
		<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:0in;text-align:center'>(Name of Person(s) Filing Proxy Statement if other than the
Registrant)</p></td>
	</tr>
	<tr>
		<td style="border-left: 1px solid #000000; border-right: 1px solid #000000" colspan="2">
		<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman"'>Payment of Filing Fee (Check the
appropriate box):</p></td>
	</tr>
	<tr>
		<td style="border-left: 1px solid #000000; border-right: 1px solid #000000" colspan="2">
		<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman"'> <font face="Wingdings">x</font>&nbsp;&nbsp;&nbsp;&nbsp;No fee required</p>
		</td>
	</tr>
	<tr>
		<td style="border-left: 1px solid #000000; border-right: 1px solid #000000" colspan="2">
		<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:0in'>
		<font face="Wingdings">o</font>&nbsp;&nbsp;&nbsp;&nbsp; Fee computed on table below per Exchange Act Rules
14a-6(i)(4) and 0-11.</p></td>
	</tr>
	<tr>
		<td style="border-left: 1px solid #000000; border-right: 1px solid #000000" colspan="2">
		<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-left:.75in;text-align:left;
text-indent:-.25in'><a name="_DV_M17"></a>1.&nbsp;&nbsp; Title of each class of
securities to which transaction applies:<br><u>&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;&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;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
		</u></p></td>
	</tr>
	<tr>
		<td style="border-left: 1px solid #000000; border-right: 1px solid #000000" colspan="2">
		<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-left:.75in;text-align:left;
text-indent:-.25in'><a name="_DV_M18"></a>2.&nbsp;&nbsp; Aggregate number of securities
to which transaction applies:<br><u>&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;&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;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
		</u></p></td>
	</tr>
	<tr>
		<td style="border-left: 1px solid #000000; border-right: 1px solid #000000" colspan="2">
		<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-left:.75in;text-align:left;
text-indent:-.25in'><a name="_DV_M19"></a>3.&nbsp;&nbsp; Per unit price or other
underlying value of transaction computed pursuant to Exchange Act
Rule&nbsp;0-11 <br>(set forth the amount on which the filing fee is calculated and state how it
was determined):<br><u>&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;&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;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
		</u></p></td>
	</tr>
	<tr>
		<td style="border-left: 1px solid #000000; border-right: 1px solid #000000" colspan="2">
		<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-left:.75in;text-align:left;
text-indent:-.25in'><a name="_DV_M20"></a>4.&nbsp;&nbsp; Proposed maximum aggregate value
of transaction:<br><u>&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;&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;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
		</u></p></td>
	</tr>
	<tr>
		<td style="border-left: 1px solid #000000; border-right: 1px solid #000000" colspan="2">
		<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-left:.75in;text-align:left;
text-indent:-.25in'><a name="_DV_M21"></a>5.&nbsp;&nbsp; Total fee paid:<br><u>&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;&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;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&n
bsp;&nbsp;&nbsp;&nbsp;
		</u></p></td>
	</tr>
	<tr>
		<td style="border-left: 1px solid #000000; border-right: 1px solid #000000" colspan="2">
		<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-left:.25in;text-indent:-.25in'>
		<font face="Wingdings">o</font>&nbsp; Fees paid previously with
		preliminary materials.</p></td>
	</tr>
	<tr>
		<td style="border-left: 1px solid #000000; border-right: 1px solid #000000" colspan="2">
		<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-left:.25in;text-indent:-.25in'>
		<font face="Wingdings">o</font>&nbsp;&nbsp;Check box if
any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and
identify the filing for which the offsetting fee was paid previously.&nbsp; Identify
the previous filing by registration statement number, or the Form or Schedule
and the date of its filing.</p></td>
	</tr>
	<tr>
		<td style="border-left: 1px solid #000000; border-right: 1px solid #000000" colspan="2">
		<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-left:.5in;text-indent:-.25in'>
		1.&nbsp;&nbsp; Amount
Previously Paid:&nbsp; &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
		</p></td>
	</tr>
	<tr>
		<td style="border-left: 1px solid #000000; border-right: 1px solid #000000" colspan="2">
		<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:0in;margin-right:0in;margin-bottom:0in;
margin-left:.5in;margin-bottom:.0001pt;text-indent:-.25in'>2.&nbsp;&nbsp; Form,
Schedule or Registration Statement No.:&nbsp; &nbsp; </p></td>
	</tr>
	<tr>
		<td style="border-left: 1px solid #000000; border-right: 1px solid #000000" colspan="2">
		<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:0in;margin-right:0in;margin-bottom:0in;
margin-left:.5in;margin-bottom:.0001pt;text-indent:-.25in'>3.&nbsp;&nbsp; Filing
Party:&nbsp; &nbsp;&nbsp;&nbsp;&nbsp; </p></td>
	</tr>
	<tr>
		<td style="border-left: 1px solid #000000; border-right: 1px solid #000000" colspan="2">
		<div style="border-bottom: 1px solid #000000">
		<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman"; margin-left:0in; margin-right:0in; margin-top:0in'>
		&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 4.&nbsp;&nbsp;&nbsp;Date
Filed:</p>
		<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman"; margin-left:0in; margin-right:0in; margin-top:0in'>
		&nbsp;</p></div>
		</td>
	</tr>
</table>
<div style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";margin-top:0in;text-align:center'>
	<p style="text-align: justify; text-autospace: none; font-family: Times New Roman; margin-left: 0in; margin-right: 0in; margin-top: 0in; margin-bottom: .0001pt">&nbsp;</p>
	<hr size=2 width="100%" noshade color=navy align=center></div>
<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<font face="Times New Roman">

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


</font>


<div style='page:Section2;'>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";line-height:12.0pt; margin-left:0in; margin-right:0in; margin-top:0in'><b>&nbsp;</b></p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'><img width=153
height=64 src="image002.jpg"></p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:center'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'>151 E Columbine
Avenue</p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;page-break-after:avoid;text-autospace:none;font-family:"Times New Roman";margin-top:0in;page-break-after:auto'>Santa Ana,
California 92707</p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;page-break-after:avoid;text-autospace:none;font-family:"Times New Roman";font-weight:bold;margin-top:0in;margin-right:0in;margin-bottom:12.0pt;
margin-left:0in;page-break-after:auto'>______________________</p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;page-break-after:avoid;text-autospace:none;font-family:"Times New Roman";font-weight:bold;margin-top:0in;margin-right:0in;margin-bottom:12.0pt;
margin-left:0in;page-break-after:auto'>NOTICE OF ANNUAL MEETING OF SHAREHOLDERS<br>
TO BE HELD DECEMBER 4, 2007</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-bottom:12.0pt; margin-left:0in; margin-right:0in; margin-top:0in'>
To the shareholders of Pro-Dex, Inc.:</p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-indent:.5in;text-autospace:none;font-family:"Times New Roman";margin-top:0in;margin-right:0in;margin-bottom:12.0pt;
margin-left:0in'>The
Annual Meeting of Shareholders of Pro-Dex, Inc. (the &#147;Company&#148;) will be held at
the DoubleTree Hotel Santa Ana, 201 E. MacArthur Blvd, Santa Ana, California,
on Tuesday, December 4, 2007, at 8:00 A.M. Pacific Time, for the following
purposes:</p>

<ol style="font-size: 10pt">
	<li>
	<p style='text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:0in;margin-left:0.35in'>
	<font size="3">To approve the amendment of the
Company&#146;s Articles of Incorporation to declassify the Board by removing the
Class I, Class II and Class III director designations.&nbsp; </font> </p></li>
	<li>
	<p style='text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:0in;margin-left:0.35in'>
	<font size="3">Subject to the approval of
Proposal No. 1, to elect three persons to serve as directors of the Company for
a term of one year each. Alternatively, if Proposal No. 1 is not approved and
the Board is not declassified, then to elect two persons to serve as Class I
directors of the Company and one person to serve as a Class II director of the
Company.&nbsp; The nominees for election to the Board are named in the attached
Proxy Statement, which is part of this Notice.&nbsp; </font></p></li>
	<li>
	<p style='text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:0in;margin-left:0.35in'>
	<font size="3">To ratify the appointment of Moss
Adams, LLP as independent public accountants of the Company for the fiscal year
ending June 30, 2008.</font></p></li>
	<li>
	<p style='text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:0in;margin-left:0.35in'>
	<font size="3">To transact such other business as
may properly come before the Annual Meeting or any adjournments or
postponements thereof.</font></p></li>
</ol>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-bottom:12.0pt;text-indent:.5in; margin-left:0in; margin-right:0in; margin-top:0in'>Only shareholders of record at the close of business
on October 15, 2007, are entitled to notice of and to vote at the Annual
Meeting and at any adjournments or postponements of the Annual Meeting.</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-bottom:12.0pt;text-indent:.5in; margin-left:0in; margin-right:0in; margin-top:0in'>
All shareholders are
cordially invited to attend the Annual Meeting in person. Whether or not you
plan to attend the Annual Meeting, your vote is important.&nbsp; In an effort to
facilitate the voting process we are pleased to take advantage of new Securities
and Exchange Commission rules that allow proxy materials to be furnished to
shareholders on the Internet.&nbsp; You can vote by proxy over the Internet by
following the instructions provided in the Notice of Internet Availability of
Proxy Materials that was previously mailed to you on or about October 24, 2007,
or, if you request printed copies of the proxy materials by mail, you can also
vote by mail or by telephone.&nbsp; Your promptness in voting by proxy will assist
in its expeditious and orderly processing and will assure that you are
represented at the Annual Meeting. If you vote by proxy, you may nevertheless
attend the Annual Meeting and vote your shares in person.</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-bottom:12.0pt;text-indent:.5in; margin-left:0in; margin-right:0in; margin-top:0in'><b>TO ENSURE YOUR REPRESENTATION AT THE
ANNUAL MEETING, YOU ARE URGED TO READ THIS PROXY STATEMENT AND SUBMIT YOUR
PROXY OR VOTING INSTRUCTIONS AS SOON AS POSSIBLE BY FOLLOWING THE INSTRUCTIONS
IN THE NOTICE OF INTERNET AVAILABILITY OF PROXY MATERIALS, WHICH WAS MAILED TO
YOU ON OR ABOUT OCTOBER 24, 2007, OR, IF YOU REQUEST PRINTED COPIES OF THE PROXY
MATERIALS BY MAIL, YOU CAN ALSO VOTE BY MAIL OR BY TELEPHONE.</b></p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:0in;margin-right:0in;
margin-bottom:12.0pt;margin-left:3.0in;text-align:left'>By Order of the Board of Directors,</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:0in;margin-right:0in;
margin-bottom:12.0pt;margin-left:3.0in;text-align:left'>PRO-DEX INC.</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-left:3.0in;text-align:left; margin-right:0in; margin-top:0in'>/s/ Jeffrey J. Ritchey</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:0in;margin-right:0in;margin-bottom:12.0pt;
margin-left:3.0in'>Corporate Secretary</p>
<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";margin-top:0in;margin-right:0in;margin-bottom:12.0pt;
margin-left:3.0in'>&nbsp;</p>
<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";margin-top:0in;margin-right:0in;margin-bottom:12.0pt;
margin-left:3.0in'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>

<div style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:center'>

<hr size=2 width="100%" noshade color=navy align=center>

</div>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<font face="Times New Roman">

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


</font>


<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:left'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'><img width=185
height=76 src="image002.jpg"></p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:center'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'>151 E Columbine
Avenue</p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;page-break-after:avoid;text-autospace:none;font-family:"Times New Roman";margin-top:0in;page-break-after:auto'>Santa Ana,
California 92707</p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;page-break-after:avoid;text-autospace:none;font-family:"Times New Roman";margin-top:0in;page-break-after:auto'><b>______________________</b></p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:center'><b><font style="font-size: 12.0pt">&nbsp;</font></b></p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'><b>ANNUAL MEETING OF
SHAREHOLDERS</b></p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'><b>TO BE HELD DECEMBER
4, 2007</b></p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'>
<b>______________________ </b></p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;page-break-after:avoid;text-autospace:none;font-family:"Times New Roman";font-weight:bold'>PROXY STATEMENT</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'><b>________________________</b></p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;page-break-after:avoid;text-autospace:none;font-family:"Times New Roman";font-weight:bold'>SOLICITATION OF PROXIES</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:12.0pt'>&nbsp;</p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-indent:.5in;text-autospace:none;font-family:"Times New Roman";margin-top:0in'>The Board of
Directors of Pro-Dex, Inc. (the &#147;Company&#148;) has made these materials available
to you on the Internet, or, upon your request, has delivered printed versions
of these materials to you by mail, in connection with the Board&#146;s solicitation
of proxies for use at the Company&#146;s Annual Meeting of Shareholders to be held
at the DoubleTree Hotel Santa Ana, 201 E. MacArthur Blvd, Santa Ana,
California, on Tuesday, December 4, 2007, at 8:00 A.M. Pacific Time, and at any
and all adjournments or postponements thereof. Shareholders are requested to
promptly vote by proxy over the Internet by following the instructions provided
in the Notice of Internet Availability of Proxy Materials, which was previously
mailed to you on or about October 24, 2007.&nbsp; If you request printed copies of
the proxy materials by mail, you can also vote by mail or by telephone.&nbsp; &nbsp;All
shares represented by each properly submitted and unrevoked proxy received in
advance of the Annual Meeting will be voted in the manner specified therein,
and if no direction is indicated, &#147;for&#148; each of the proposals described on the
proxy card.</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:12.0pt;text-indent:.5in; margin-left:0in; margin-right:0in'>Any
shareholder has the power to revoke his or her proxy at any time before it is
voted.&nbsp; A proxy may be revoked by delivering a written notice of revocation to
the Secretary of the Company prior to or at the Annual Meeting, by voting again
on the Internet or by telephone (only your latest Internet or telephone proxy
submitted prior to 11:59 P.M. Eastern Time on December 3, 2007 will be
counted), by submitting prior to or at the Annual Meeting a later dated proxy
card executed by the person executing the prior proxy, or by attendance at the
Annual Meeting and voting in person by the person submitting the prior proxy.</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:12.0pt;text-indent:.5in; margin-left:0in; margin-right:0in'>Any shareholder
who would like to vote in person at the Annual Meeting and owns shares in
street name, should inform his/her broker bank of such plans and request a
legal proxy from the broker. Such shareholders will need to bring the legal
proxy with them to the Annual Meeting and valid picture identification such as
a driver's license or passport in addition to documentation indicating share
ownership. Such shareholders who do not receive the legal proxy in time, should
bring with them to the Annual Meeting their most recent brokerage account
statement showing that they owned Pro-Dex, Inc. stock as of the record date.&nbsp;
Upon submission of proper identification and ownership documentation, the
Company will be able to verify ownership of its Common Stock and admit the
shareholder to the Annual Meeting; however, such shareholder will not be able
to vote his/her shares at the Annual Meeting without a legal proxy.&nbsp;
Shareholders are advised that if they own shares in street name and request a
legal proxy, any previously executed proxy will be revoked, and such
shareholder&#146;s vote will not be counted unless he/she appears at the Annual
Meeting and votes in person.</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'>Page
1</p>

<div style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:center'>

<hr size=2 width="100%" noshade color=navy align=center>

</div>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<font face="Times New Roman">

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


</font>


<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:left'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-indent:.5in;text-autospace:none;font-family:"Times New Roman"'>The Company&#146;s Board of Directors does not presently intend to
bring any business before the Annual Meeting other than the proposals referred
to in this proxy statement and specified in the Notice of Meeting. So far as is
known to the Company&#146;s Board of Directors, no other matters are to be brought
before the meeting. As to any business that may properly come before the
meeting, however, it is intended that shares represented by proxies held by
management will be voted in accordance with the judgment of the persons voting
the shares.</p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-indent:.5in;text-autospace:none;font-family:"Times New Roman"'>
<b>This proxy statement, the accompanying
proxy card and the Company&#146;s Annual Report are being made available on the
internet at</b>  <font color="#0000FF"><u>www.investoreconnect.com</u></font>
<b>through the notice and access process to the Company&#146;s shareholders
on or about October 24, 2007.</b>&nbsp; The cost of soliciting proxies will be borne
by the Company. The solicitation will be made through the internet and expenses
will include reimbursement paid to brokerage firms and others for their
expenses in forwarding solicitation material regarding the Annual Meeting to
beneficial owners of the Company&#146;s Common Stock.&nbsp; Further solicitation of
proxies may be made by mail upon request, and telephone or oral communications
with some shareholders. The Company&#146;s regular employees, who will not receive
additional compensation for the solicitation, or a compensated proxy
solicitation firm, will make such further solicitations. </p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;page-break-after:avoid;text-autospace:none;font-family:"Times New Roman";font-weight:bold'>OUTSTANDING SHARES AND VOTING RIGHTS</p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-indent:.5in;text-autospace:none;font-family:"Times New Roman"'>Only holders of record of the 9,718,366
shares of the Company&#146;s Common Stock outstanding at the close of business on
October 15, 2007, are entitled to notice of and to vote at the Annual Meeting
or any adjournment or postponement thereof.&nbsp; Under Colorado law, the Company&#146;s
Articles of Incorporation and the Company&#146;s Bylaws, the
holders of shares entitled to cast a
majority of the <a name="_DV_C8">total votes of the outstanding
shares of stock</a> entitled to vote<a
name="_DV_C9"> on each matter, as of the record date</a>, represented in person or by proxy, will constitute a
quorum for the transaction of business at the
Annual Meeting.&nbsp; If a quorum is not present, the Annual Meeting may be
postponed or adjourned to allow additional time for obtaining additional
proxies or votes.&nbsp; At any subsequent reconvening of the Annual Meeting, all
proxies will be voted in the same manner as the proxies would have been voted
at the original convening of the Annual Meeting, except for any proxies that
have been effectively revoked or withdrawn prior to the reconvening of the
Annual Meeting.&nbsp; Shares of the
Company&#146;s Common Stock represented in person or by proxy (regardless of whether
the proxy has authority to vote on all matters), as well as abstentions and
broker non-votes, will be counted for purposes of determining whether a quorum is
present at the meeting.</p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-indent:.5in;text-autospace:none;font-family:"Times New Roman"'>An &#147;abstention&#148; is the voluntary act of
not voting by a shareholder who is present at a meeting and entitled to vote.&nbsp;
&#147;Broker non-votes&#148; are shares of voting stock held in record name by brokers
and nominees concerning which: (i) instructions have not been received from the
beneficial owners or persons entitled to vote; (ii) the broker or nominee does
not have discretionary voting power under applicable rules or the instrument
under which it serves in such capacity; or (iii) the record holder has
indicated on the proxy or has executed a proxy and otherwise notified the
Company that it does not have authority to vote such shares on that matter.</p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-indent:.5in;text-autospace:none;font-family:"Times New Roman"'>Assuming a quorum is present, for
Proposal 2 (the election of directors) the three nominees for director (or in
the event Proposal No. 1 is not approved, the two nominees for director for the
Class I positions and the one person for the Class II position) receiving the
highest number of affirmative votes will be elected; votes withheld and votes
against a nominee have no practical effect.&nbsp; In matters
other than election of directors, assuming that a quorum is present<b>, </b>for each matter, the matter will be approved if the votes
cast in favor of the matter exceed the votes cast opposing the matter.&nbsp; In such matters, abstentions and broker non-votes will not be included in the vote totals and, therefore,
will have no effect on the vote.&nbsp; Each shareholder will be
entitled to one vote, in person or by proxy, for each share of Common Stock
held of record on the record date. Votes cast at the meeting will be tabulated
by the person or persons appointed by the Company to act as inspectors of
election for the meeting.</p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;page-break-after:avoid;text-autospace:none;font-family:"Times New Roman";font-weight:bold;text-align:left'>Recommendation
of the Company&#146;s Board of Directors</p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-indent:.5in;text-autospace:none;font-family:"Times New Roman"'>The Company&#146;s Board of Directors recommends
that the Company&#146;s shareholders vote &#147;for&#148; each of the proposals described in
this proxy statement and the accompanying Notice of Meeting.</p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-indent:.5in;text-autospace:none;font-family:"Times New Roman"'>
<b>THE PROPOSALS TO BE VOTED UPON AT
THE MEETING ARE DISCUSSED IN DETAIL IN THIS PROXY STATEMENT. YOU ARE STRONGLY
URGED TO READ AND CONSIDER CAREFULLY THIS PROXY STATEMENT IN ITS ENTIRETY.</b></p>
<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-indent:.5in;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'>Page 2</p>

<div style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:center'>

<hr size=2 width="100%" noshade color=navy align=center>

</div>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<font face="Times New Roman">

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


</font>


<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:left'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-indent:.5in;text-autospace:none;font-family:"Times New Roman";text-align:center;text-indent:0in'><b>SECURITY
OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT</b></p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-indent:.5in;text-autospace:none;font-family:"Times New Roman";text-indent:0in'>The following table
sets forth certain information with respect to the beneficial ownership of the
Company&#146;s Common Stock as of the record date, October 15, 2007, by (i) each
person known by the Company to beneficially own more than 5% of the outstanding
shares of Common Stock, (ii) each of the Company&#146;s current and nominated
directors, (iii) each of the Named Executive Officers (as hereinafter defined),
and (iv) all current directors and Named Executive Officers of the Company as a
group.</p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-indent:.5in;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-indent:0in'>&nbsp;</p>

<div align="center">

<table class=MsoNormalTable border=0 cellpadding=0
 style='border-collapse:collapse' width="100%">
 <tr>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0 0in;text-align:justify; text-autospace:none; font-family:Times New Roman; line-height:12.0pt; margin-bottom:0'><b>&nbsp;</b></p>
  <p style='margin:0 0in;text-align:justify; text-autospace:none; font-size:11.0pt; font-family:Times New Roman; line-height:12.0pt; margin-bottom:0'><b><u>
	<font size="3">Name of Beneficial Owner</font></u><sup><font size="3">(1)<br>
&nbsp;</font></sup></b></p>
  </td>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in' colspan="2">
  <p style='margin:0 0in;text-autospace:none; font-size:11.0pt; font-family:Times New Roman; text-align:center; line-height:12.0pt; margin-bottom:0'><b>
	<font size="3">Number of Shares of Common <u>
	<br>
	Stock Beneficially
  Owned</u></font><sup><font size="3">(2)<br>
&nbsp;</font></sup></b></p>
  </td>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in' colspan="2">
  <p style='margin:0 0in;text-autospace:none; font-size:11.0pt; font-family:Times New Roman; text-align:center; line-height:12.0pt; margin-bottom:0'><b>
	<font size="3">Percent of Common Stock <u>
	<br>
	Beneficially Owned</u></font><sup><font size="3">(3)<br>
&nbsp;</font></sup></b></p>
  </td>
 </tr>
 <tr>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";line-height:12.0pt; margin-left:0in; margin-right:0in; margin-top:0in'>First Wilshire Securities
  Management Inc.</p>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman"; margin-left:0in; margin-right:0in; margin-top:0in'>1224 East Green Street</p>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";line-height:12.0pt; margin-left:0in; margin-right:0in; margin-top:0in'>Pasadena, CA 91106</p>
  </td>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:left;line-height:12.0pt; margin-left:0in; margin-right:0in'>&nbsp;</p>
  <p style='margin-bottom:.0001pt;text-autospace:none;font-family:"Times New Roman";line-height:12.0pt; margin-left:0in; margin-right:0in; '>&nbsp;&nbsp;&nbsp; 1,609,695</p>
  </td>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in' align="right">
  &nbsp;</td>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:12.0pt; margin-left:0in; margin-right:0in'>&nbsp;</p>
  <p style='margin-bottom:.0001pt;text-autospace:none;font-family:"Times New Roman";line-height:12.0pt; margin-left:0in; margin-right:0in; '>16.6%</p>
  </td>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in' align="right">
  &nbsp;</td>
 </tr>
 <tr>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  &nbsp;</td>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in' align="right">
  &nbsp;</td>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in' align="right">
  &nbsp;</td>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in' align="right">
  &nbsp;</td>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in' align="right">
  &nbsp;</td>
 </tr>
 <tr>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";line-height:12.0pt; margin-left:0in; margin-right:0in; margin-top:0in'>Ronald G. Coss </p>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman"; margin-left:0in; margin-right:0in; margin-top:0in'>3 Overlook Drive</p>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";line-height:12.0pt; margin-left:0in; margin-right:0in; margin-top:0in'>Newport Coast, CA 92657</p>
  </td>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in' align="right">
  <p style='margin-bottom:5pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:center;line-height:12.0pt; margin-left:0in; margin-right:0in'>&nbsp;</p>
  <p style='margin-bottom:5pt;text-autospace:none;font-family:"Times New Roman";line-height:12.0pt; margin-left:0in; margin-right:0in; '>&nbsp;&nbsp;&nbsp; 1,316,879<sup>(4)</sup> </p>
  </td>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in' align="right">
  &nbsp;</td>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:12.0pt; margin-left:0in; margin-right:0in; '>&nbsp;</p>
  <p style='margin-bottom:.0001pt;text-autospace:none;font-family:"Times New Roman";line-height:12.0pt; margin-left:0in; margin-right:0in; '>13.4%</p>
  </td>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in' align="right">
  &nbsp;</td>
 </tr>
 <tr>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:12.0pt'>&nbsp;</p>
  </td>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in' align="right">
  <p style='margin-bottom:5pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:center;line-height:12.0pt; margin-left:0in; margin-right:0in'>&nbsp;</p>
  </td>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in' align="right">
  &nbsp;</td>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:12.0pt; margin-left:0in; margin-right:0in'>&nbsp;</p>
  </td>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in' align="right">
  &nbsp;</td>
 </tr>
 <tr>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";line-height:12.0pt; margin-left:0in; margin-right:0in; margin-top:0in'>George J. Isaac </p>
  </td>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in' align="right">
  <p style='margin-bottom:5pt;text-autospace:none;font-family:"Times New Roman";line-height:12.0pt; margin-left:0in; margin-right:0in; '>164,900<sup>(4)</sup></p>
  </td>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in' align="right">
  &nbsp;</td>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-autospace:none;font-family:"Times New Roman";line-height:12.0pt; margin-left:0in; margin-right:0in; '>&nbsp;1.7% </p>
  </td>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in' align="right">
  &nbsp;</td>
 </tr>
 <tr>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";line-height:12.0pt; margin-left:0in; margin-right:0in; margin-top:0in'>Mark P. Murphy</p>
  </td>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in' align="right">
  <p style='margin-bottom:5pt;text-autospace:none;font-family:"Times New Roman";line-height:12.0pt; margin-left:0in; margin-right:0in; '>163,200<sup>(4)</sup></p>
  </td>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in' align="right">
  &nbsp;</td>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-autospace:none;font-family:"Times New Roman";line-height:12.0pt; margin-left:0in; margin-right:0in; '>&nbsp;1.7%</p>
  </td>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in' align="right">
  &nbsp;</td>
 </tr>
 <tr>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";line-height:12.0pt; margin-left:0in; margin-right:0in; margin-top:0in'>Michael A. Mesenbrink</p>
  </td>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in' align="right">
  <p style='margin-bottom:5pt;text-autospace:none;font-family:"Times New Roman";line-height:12.0pt; margin-left:0in; margin-right:0in; '>80,000<sup>(4)</sup></p>
  </td>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in' align="right">
  &nbsp;</td>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-autospace:none;font-family:"Times New Roman";line-height:12.0pt; margin-left:0in; margin-right:0in; '>&nbsp;*&nbsp;</p>
  </td>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in' align="right">
  &nbsp;</td>
 </tr>
 <tr>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";line-height:12.0pt; margin-left:0in; margin-right:0in; margin-top:0in'>Valerio L. Giannini</p>
  </td>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in' align="right">
  <p style='margin-bottom:5pt;text-autospace:none;font-family:"Times New Roman";line-height:12.0pt; margin-left:0in; margin-right:0in; '>80,000<sup>(4)</sup></p>
  </td>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in' align="right">
  &nbsp;</td>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-autospace:none;font-family:"Times New Roman";line-height:12.0pt; margin-left:0in; margin-right:0in; '>&nbsp;*&nbsp;</p>
  </td>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in' align="right">
  &nbsp;</td>
 </tr>
 <tr>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:12.0pt'>&nbsp;</p>
  </td>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in' align="right">
  <p style='margin-bottom:5pt;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:12.0pt; margin-left:0in; margin-right:0in; '>&nbsp;</p>
  </td>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in' align="right">
  &nbsp;</td>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:12.0pt; margin-left:0in; margin-right:0in'>&nbsp;</p>
  </td>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in' align="right">
  &nbsp;</td>
 </tr>
 <tr>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";line-height:12.0pt; margin-left:0in; margin-right:0in; margin-top:0in'>Patrick Johnson </p>
  </td>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in' align="right">
  <p style='margin-bottom:5pt;text-autospace:none;font-family:"Times New Roman";line-height:12.0pt; margin-left:0in; margin-right:0in; '>534,176<sup>(4)</sup></p>
  </td>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in' align="right">
  &nbsp;</td>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-autospace:none;font-family:"Times New Roman";line-height:12.0pt; margin-left:0in; margin-right:0in; '>5.3% </p>
  </td>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in' align="right">
  &nbsp;</td>
 </tr>
 <tr>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";line-height:12.0pt; margin-left:0in; margin-right:0in; margin-top:0in'>Jeffrey J. Ritchey&nbsp;&nbsp; </p>
  </td>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in' align="right">
  <p style='margin-bottom:5pt;text-autospace:none;font-family:"Times New Roman";line-height:12.0pt; margin-left:0in; margin-right:0in; '>117,000<sup>(4)</sup></p>
  </td>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in' align="right">
  &nbsp;</td>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-autospace:none;font-family:"Times New Roman";line-height:12.0pt; margin-left:0in; margin-right:0in; '>1.2%</p>
  </td>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in' align="right">
  &nbsp;</td>
 </tr>
 <tr>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:12.0pt'>&nbsp;</p>
  </td>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in' align="right">
  <p style='margin-bottom:5pt;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:12.0pt; margin-left:0in; margin-right:0in; '>&nbsp;</p>
  </td>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in' align="right">
  &nbsp;</td>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:12.0pt; margin-left:0in; margin-right:0in'>&nbsp;</p>
  </td>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in' align="right">
  &nbsp;</td>
 </tr>
 <tr>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:left; margin-left:0in; margin-right:0in; margin-top:0in'>All Named Executive
  Officers and directors as a group (6 persons) </p>
  </td>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in' align="right">
  <p style='margin-bottom:5pt;text-autospace:none;font-family:"Times New Roman";line-height:12.0pt; margin-left:0in; margin-right:0in; '><a
  name="_DV_M68"></a>1,139,276<sup>(4)</sup></p>
  </td>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in' align="right">
  &nbsp;</td>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-autospace:none;font-family:"Times New Roman";line-height:12.0pt; margin-left:0in; margin-right:0in; '><a name="_DV_M69"></a>10.9%<b> </b></p>
  </td>
  <td valign=bottom style='padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in' align="right">
  &nbsp;</td>
 </tr>
</table>

</div>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-left:.5in;text-indent:-.5in; margin-right:0in; margin-top:0in'><a name="_DV_M70"></a>__________________________</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:6.0pt;margin-right:0in;margin-bottom:0in;
margin-left:.5in;margin-bottom:.0001pt;text-indent:-.5in'>* Less than 1%.</p>

<ol style="font-size: 10pt">
	<li>
	<p style='text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-left:0.35in'>
	<font size="3">Unless otherwise indicated, the address is c/o
Pro-Dex, Inc., 151 E. Columbine Avenue, Santa Ana, California 92707.</font></p>
	</li>
	<li>
	<p style='text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-left:0.35in'>
	<font size="3">Unless otherwise indicated, to the Company&#146;s
knowledge, the persons named in the table have sole voting and sole investment
power with respect to all shares beneficially owned, subject to community
property and similar laws, where applicable.</font></p></li>
	<li>
	<p style='margin-left:.5in;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";margin-left:0.35in;'>
	<font size="3">Applicable percentage ownership is based on
9,718,366 shares of Common Stock
outstanding as of October 15, 2007.&nbsp; Any securities not outstanding but subject
to <a name="_DV_C25">warrants or</a>
options exercisable as of October 15, 2007 or exercisable within
60 days after such date are deemed to be outstanding for the purpose of
computing the percentage of outstanding Common Stock beneficially owned by the
person holding such warrants or options but are not
deemed to be outstanding for the purpose of computing the percentage of Common
Stock beneficially owned by any other person.<a name="_DV_M75"></a><a
name="_DV_M76"></a></font></p></li>
	<li>
	<p style='text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-left:0.35in'>
	<font size="3">Includes shares of Common Stock
	<a name="_DV_C28">issuable
upon the exercise of</a> warrants
and options which were exercisable as of October 15, 2007 or exercisable within
60 days after October 15, 2007, as follows: Mr. Coss, <a name="_DV_C18">100,000</a><a
name="_DV_M78"></a> shares, Mr. Isaac, 60,000 shares; Mr. Murphy, 30,000
shares; Mr. Mesenbrink, 80,000 shares; Mr. Giannini, 60,000 shares; Mr.
Johnson, 412,500 shares; Mr. Ritchey, 115,000 shares, and all current directors
and Named Executive Officers as a group, <a name="_DV_M79"></a>757,500
shares. </font></p></li>
</ol>
<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";margin-top:6.0pt;margin-right:0in;margin-bottom:0in;
margin-left:16.5pt;margin-bottom:.0001pt;text-indent:-16.5pt'>&nbsp;</p>
<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";margin-top:6.0pt;margin-right:0in;margin-bottom:0in;
margin-left:16.5pt;margin-bottom:.0001pt;text-indent:-16.5pt'>&nbsp;</p>
<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";margin-top:6.0pt;margin-right:0in;margin-bottom:0in;
margin-left:16.5pt;margin-bottom:.0001pt;text-indent:-16.5pt'>&nbsp;</p>
<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";margin-top:6.0pt;margin-right:0in;margin-bottom:0in;
margin-left:16.5pt;margin-bottom:.0001pt;text-indent:-16.5pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:center;line-height:12.0pt;
page-break-after:avoid'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'>Page 3</p>

<div style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:center'>

<hr size=2 width="100%" noshade color=navy align=center>

</div>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<font face="Times New Roman">

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


</font>


<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:left'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:12.0pt;text-align:center;
page-break-after:avoid; margin-left:0in; margin-right:0in'><b>Proposal No. 1</b></p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:12.0pt;text-align:center; margin-left:0in; margin-right:0in'>
<b>Approval of the
Amendment of the Company&#146;s Articles of Incorporation to Remove Class I, Class
II and Class III Board member designations.</b></p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:12.0pt; margin-left:0in; margin-right:0in'>
<b>General</b></p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-indent:.5in;text-autospace:none;font-family:"Times New Roman"'>Article 9 of the Company&#146;s Articles of Incorporation
establish three (3) classes of directors (Class I, Class
II and Class III) with terms of three years each.&nbsp; Generally,
absent earlier resignation of a Class member, the terms of the classes are
staggered and one Class stands for re-election at each annual meeting of
shareholders.&nbsp; On September 20, 2007, the Board of Directors approved
an amendment of the Company&#146;s Articles of Incorporation to remove the class
designations for each of the director&#146;s terms<b>,</b> subject,
in the case of the amendment to the Articles of Incorporation, to shareholder
approval at the Annual Meeting.&nbsp; If approved by the Company&#146;s shareholders, the
amendment shall be filed with the Colorado Secretary of State shortly following
the Annual Meeting and will be in effect upon filing. The amendment to Article
9 will not shorten the current term of any director as of the date of the
Annual Meeting (December 4, 2007).</p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-indent:.5in;text-autospace:none;font-family:"Times New Roman"'>Article VI, Section 6.5 of the Company&#146;s Bylaws permits
the Board to amend the Bylaws by majority vote.&nbsp; Similar to the Articles of
Incorporation, the Bylaws contain provisions concerning the classification of
the Board of Directors.&nbsp; To cause the Bylaws to be consistent with the Articles
of Incorporation, the Board anticipates amending the Company&#146;s Bylaws to remove
its classified Board designation shortly following approval of this Proposal by
the Company&#146;s shareholders.&nbsp; If this Proposal is not approved, the Board will
not amend the Bylaws as described above.</p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-indent:.5in;text-autospace:none;font-family:"Times New Roman"'>The Company&#146;s management believes that current best
practices of corporate governance maintain that the entire board should be
subject to reelection at each annual shareholders&#146; meeting.&nbsp; If this proposal
is approved, the class designation of the Board of Directors in Article 9 will
be eliminated and, following amendment of the Bylaws by the Board (as discussed
above) and upon the expiration of the current terms of the existing Board members,
the entire Board will be subject to reelection at subsequent annual
shareholders&#146; meetings.&nbsp;&nbsp; Mr. Murphy and Mr. Giannini are the two incumbent
directors with current terms that extend beyond the Annual Meeting (Mr.
Giannini&#146;s term expires at the 2008 Annual Shareholders&#146; Meeting and Mr.
Murphy&#146;s term expires at the 2009 Annual Shareholders&#146; Meeting).&nbsp; Accordingly,
if Proposal No. 1 is approved by the Company&#146;s shareholders, all director
positions will be elected annually commencing with the 2009 Annual
Shareholders&#146; Meeting.</p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-indent:.5in;text-autospace:none;font-family:"Times New Roman"'>This proposal would amend Article 9 to read in its
entirety as follows:</p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-indent:.5in;text-autospace:none;font-family:"Times New Roman";margin-top:12.0pt;margin-right:103.5pt;margin-bottom:0in;
margin-left:1.0in;margin-bottom:.0001pt;text-indent:-.5in'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Article
9 :&nbsp; The number of directors of the Corporation shall be fixed in accordance
with the Bylaws of the Corporation.&nbsp; The Board of Directors shall not be split
in to separate classes nor staggered.&nbsp; The adoption of this Article shall not
serve to shorten the current term of any member of the Board of Directors as of
December 4, 2007.</p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman"'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; If this Proposal No. 1 is not
approved by Company&#146;s the shareholders, then the election of Messrs. Isaac and
Mesenbrink as the two Class I director nominees and Mr. Healy as a Class II
director nominee as set forth in Proposal No. 2 shall proceed under the
Company&#146;s Articles of Incorporation as currently in effect.&nbsp;&nbsp; In such case, the
Class I director nominees shall be elected for a term of three years and the
Class II director nominee shall serve the remaining one year term of such
class.</p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman"'>
<b>Required Vote and Board Recommendation</b></p>
<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman"'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Assuming the
holders of shares entitled
to cast a majority of the total
votes of the outstanding shares of stock entitled to vote on this proposal,
represented in person or by proxy, are present at the Annual Meeting, this
proposal will be approved if the votes cast in favor of this proposal exceed
the votes cast opposing this proposal.&nbsp; Abstentions and broker non-votes will
be counted for purposes of determining whether a quorum is present for this
proposal, but will not be included in the vote totals for this proposal and,
therefore, will have no effect on the vote.</p>
<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'>Page 4</p>

<div style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:center'>

<hr size=2 width="100%" noshade color=navy align=center>

</div>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<font face="Times New Roman">

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


</font>


<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:left'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-indent:.5in;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:12.0pt;text-indent:.5in; margin-left:0in; margin-right:0in'>
<b>THE BOARD OF
DIRECTORS RECOMMENDS THAT THE SHAREHOLDERS VOTE &quot;FOR&quot; THE APPROVAL OF
THE AMENDMENT OF THE COMPANY&#146;S ARTICLES OF INCORPORATION.</b></p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:12.0pt;text-indent:.5in; margin-left:0in; margin-right:0in'><b>&nbsp;</b></p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;line-height:12.0pt;
page-break-after:avoid; margin-left:0in; margin-right:0in; margin-top:0in'><b>Proposal No. 2</b></p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:12.0pt;text-align:center;
page-break-after:avoid; margin-left:0in; margin-right:0in'><b>ELECTION OF DIRECTORS</b></p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:12.0pt;text-indent:.5in; margin-left:0in; margin-right:0in'><b>Current Board
Structure and Director Terms</b></p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:12.0pt;text-indent:.5in; margin-left:0in; margin-right:0in'>As discussed in
Proposal No. 1, the Company&#146;s Articles of Incorporation currently provide for
the classification of the Company&#146;s Board of Directors.&nbsp; The Board of
Directors, which currently is composed of four (4) members, is divided into
three (3) classes.&nbsp; Generally, absent earlier resignation of a Class member,
one Class stands for re-election at each annual meeting of shareholders. The
Board of Directors currently is comprised of two Class I directors (George J.
Isaac and Michael A. Mesenbrink), one Class II director (Valerio L. Giannini),
and one Class III director (Mark P. Murphy). &nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:12.0pt;text-indent:.5in; margin-left:0in; margin-right:0in'>The term of the
Class I directors expires in 2007 .&nbsp; The term of the Class II director expires
in 2008.&nbsp; The term of the Class III director expires in 2009.</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:12.0pt;text-indent:.5in; margin-left:0in; margin-right:0in'>On
September 20, 2007, the Board of Directors approved increasing the size of the
Board to five (5) directors effective as of the Annual Meeting by adding an
additional Class II director position.&nbsp; The Class II position has one year
remaining on its term and stands for election again at the 2008 Annual
Shareholders&#146; Meeting.&nbsp; Mr. William L. Healey has been nominated to fill the
new Class II director position.&nbsp; </p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:12.0pt;text-indent:.5in; margin-left:0in; margin-right:0in'>This Proposal No.
2 concerns the election of directors under two alternative scenarios: </p>

<ul>
	<li>
	<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:12.0pt;margin-bottom:
0in;margin-left:0.25in;margin-bottom:.0001pt'>if Proposal No. 1 is approved by the Company&#146;s shareholders which
amends the Company&#146;s Articles of Incorporation to remove the class designations
of the Company&#146;s directors; or </p></li>
	<li>
	<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:12.0pt;margin-bottom:
0in;margin-left:0.25in;margin-bottom:.0001pt'>if Proposal No. 1 is not approved by the Company&#146;s
shareholders and the Company retains its Class I, Class II and Class III
director designations.&nbsp; </p></li>
</ul>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:12.0pt;text-indent:.5in; margin-left:0in; margin-right:0in'>
<b>Effect of Vote for
Directors Subject to Proposal No. 1</b></p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:12.0pt;text-indent:.5in; margin-left:0in; margin-right:0in'>
<b><i>If Proposal No.
1 Approved</i></b>.&nbsp;&nbsp;&nbsp; Under Proposal No. 1, the
adoption of the amendment to Article 9 shall not serve to shorten the current
term of any member of the Board of Directors.&nbsp; Following the Annual Meeting and
election of the director nominees set forth in this proxy statement, Mr. Murphy
and Mr. Giannini will be the only two incumbent directors each having a current
term that extends beyond the Annual Meeting (Mr. Giannini&#146;s term expires at the
2008 Annual Shareholders&#146; Meeting and Mr. Murphy&#146;s term expires at the 2009
Annual Shareholders&#146; Meeting).&nbsp; Accordingly, if Proposal No. 1 is approved by
the Company&#146;s shareholders, the classified structure of the Board shall be eliminated,
director nominees Messrs. Isaac, Mesenbrink and Healey will be elected to a one
year term, and Mr. Murphy and Mr. Giannini shall continue to serve the
remainder of their respective current terms.&nbsp; </p>
<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";margin-top:12.0pt;text-indent:.5in'>&nbsp;</p>
<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";margin-top:12.0pt;text-indent:.5in'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'>Page 5</p>

<div style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:center'>

<hr size=2 width="100%" noshade color=navy align=center>

</div>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";line-height:1.0pt; margin-left:0in; margin-right:0in; margin-top:0in'><i>&nbsp;</i></p>

<font face="Times New Roman">

<i><br clear=all style='page-break-before:
always'>
</i>

</font>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";line-height:1.0pt; margin-left:0in; margin-right:0in; margin-top:0in'><i>&nbsp;</i></p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";line-height:1.0pt; margin-left:0in; margin-right:0in; margin-top:0in'><i>&nbsp;</i></p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:left'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";line-height:1.0pt; margin-left:0in; margin-right:0in; margin-top:0in'><i>&nbsp;</i></p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:12.0pt;text-indent:.5in; margin-left:0in; margin-right:0in'><i>
<b>If Proposal No.
1 Not Approved</b>. </i>If Proposal No. 1 is not
approved by the Company&#146;s shareholders, the election of Messrs. Isaac and
Mesenbrink as the two Class I director nominees and Mr. Healy as a Class II
director nominee as set forth in this Proposal No. 2 shall proceed under the
Company&#146;s Articles of Incorporation as currently in effect.&nbsp;&nbsp; In such case, the
Class I director nominees shall be elected for a term of three years and the
Class II director nominee shall serve the remaining one year term allocated to
Class II directors. </p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-indent:.5in;text-autospace:ideograph-numeric ideograph-other; margin-left:0in; margin-right:0in; margin-top:12pt'>Certain
information with respect to each of the nominees who will be presented at the
Annual Meeting by the Board of Directors for election as a director is set
forth below. Although it is anticipated that each nominee will be available to
serve as a director, should that nominee become unavailable to serve, the
proxies will be voted for such other person as may be designated by the
Company&#146;s Board of Directors.</p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-indent:.5in;text-autospace:none;font-family:"Times New Roman"'>Unless the authority to vote for directors has been withheld in
the proxy, the persons named in the accompanying proxy intend to vote at the
Annual Meeting for the election of the nominees presented below. In the
election of directors, assuming a quorum is present, the three nominees for
director (or in the event Proposal No. 1 is not approved, the two Class I nominees
and the one Class II nominee) receiving the highest number of votes cast at the
meeting will be elected as directors of the Company.</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;page-break-after:avoid;text-autospace:none;font-family:"Times New Roman";font-weight:bold;margin-top:0in'>DIRECTORS</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-indent:.5in; margin-left:0in; margin-right:0in; margin-top:0in'>Set forth
below is certain information with respect to the Company&#146;s continuing directors
and director nominees.</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:center;text-indent:.5in'>&nbsp;</p>

<div align="center">

<table class=MsoNormalTable border=0 cellpadding=0 width=656
 style='width:100%;border-collapse:collapse' id="table3">
 <tr style='height:12.25pt'>
  <td width=1 valign=bottom style='width:.8pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:center'>&nbsp;</p>
  </td>
  <td width=146 valign=bottom style='border-left:1px solid #000000; border-right:medium none; border-top:1pt solid #000000; width:109.3pt;border-bottom:
  1.0pt solid windowtext;height:12.25pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:left'><b>Name</b></p>
  </td>
  <td width=59 valign=bottom style='border-left:medium none; border-right:medium none; border-top:1pt solid #000000; width:44.35pt;border-bottom:
  1.0pt solid windowtext;height:12.25pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:left'><b>Age</b></p>
  </td>
  <td width=233 valign=bottom style='border-left:medium none; border-right:medium none; border-top:1pt solid #000000; width:175.0pt;border-bottom:
  1.0pt solid windowtext;height:12.25pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:left'><b>Position with Company</b></p>
  </td>
  <td width=68 valign=bottom style='border-left:medium none; border-right:medium none; border-top:1pt solid #000000; width:50.7pt;border-bottom:
  1.0pt solid windowtext;height:12.25pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:left'><b>Class</b></p>
  </td>
  <td width=147 valign=bottom style='border-left:medium none; border-right:1px solid #000000; border-top:1pt solid #000000; width:110.1pt;border-bottom:
  1.0pt solid windowtext;height:12.25pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:left'><b>Class Expiration Year</b></p>
  </td>
  <td width=2 valign=bottom style='width:1.6pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
 </tr>
 <tr style='height:12.25pt'>
  <td width=1 valign=bottom style='width:.8pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td width=146 valign=bottom style='border-left:1px solid #000000; width:109.3pt;height:12.25pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:left'>Mark P. Murphy</p>
  </td>
  <td width=59 valign=bottom style='width:44.35pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:right'>48&nbsp;</p>
  </td>
  <td width=233 valign=bottom style='width:175.0pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:left'>Director</p>
  </td>
  <td width=68 valign=bottom style='width:50.7pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:left'>Class III</p>
  </td>
  <td width=147 valign=bottom style='border-right:1px solid #000000; width:110.1pt;height:12.25pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in' align="center">
  <p style='margin-bottom:.0001pt;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";margin-left:0in; margin-right:0in; margin-top:0in'>2009</p>
  </td>
  <td width=2 valign=bottom style='width:1.6pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
 </tr>
 <tr style='height:12.25pt'>
  <td width=1 valign=bottom style='width:.8pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td width=146 valign=bottom style='border-left:1px solid #000000; width:109.3pt;height:12.25pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td width=59 valign=bottom style='width:44.35pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td width=233 valign=bottom style='width:175.0pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:left'>Chief Executive Officer and
  President</p>
  </td>
  <td width=68 valign=bottom style='width:50.7pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td width=147 valign=bottom style='border-right:1px solid #000000; width:110.1pt;height:12.25pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in' align="center">
  <p style='margin-bottom:.0001pt;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman"; margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp;</p>
  </td>
  <td width=2 valign=bottom style='width:1.6pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
 </tr>
 <tr style='height:12.25pt'>
  <td width=1 valign=bottom style='width:.8pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td width=146 valign=bottom style='border-left:1px solid #000000; width:109.3pt;height:12.25pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:left'>George J. Isaac</p>
  </td>
  <td width=59 valign=bottom style='width:44.35pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:right'>62&nbsp;</p>
  </td>
  <td width=233 valign=bottom style='width:175.0pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:left'>Director&#185; and Nominee</p>
  </td>
  <td width=68 valign=bottom style='width:50.7pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:left'>Class I</p>
  </td>
  <td width=147 valign=bottom style='border-right:1px solid #000000; width:110.1pt;height:12.25pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in' align="center">
  <p style='margin-bottom:.0001pt;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";margin-left:0in; margin-right:0in; margin-top:0in'>2007</p>
  </td>
  <td width=2 valign=bottom style='width:1.6pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
 </tr>
 <tr style='height:12.25pt'>
  <td width=1 valign=bottom style='width:.8pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td width=146 valign=bottom style='border-left:1px solid #000000; width:109.3pt;height:12.25pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:left'>Michael A. Mesenbrink</p>
  </td>
  <td width=59 valign=bottom style='width:44.35pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:right'>60&nbsp;</p>
  </td>
  <td width=233 valign=bottom style='width:175.0pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:left'>Director&#185; and Nominee</p>
  </td>
  <td width=68 valign=bottom style='width:50.7pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:left'>Class I</p>
  </td>
  <td width=147 valign=bottom style='border-right:1px solid #000000; width:110.1pt;height:12.25pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in' align="center">
  <p style='margin-bottom:.0001pt;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";margin-left:0in; margin-right:0in; margin-top:0in'>2007</p>
  </td>
  <td width=2 valign=bottom style='width:1.6pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
 </tr>
 <tr style='height:12.25pt'>
  <td width=1 valign=bottom style='width:.8pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td width=146 valign=bottom style='border-left:1px solid #000000; width:109.3pt;height:12.25pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:left'>William L. Healey</p>
  </td>
  <td width=59 valign=bottom style='width:44.35pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:right'>62&nbsp;</p>
  </td>
  <td width=233 valign=bottom style='width:175.0pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:left'>Nominee</p>
  </td>
  <td width=68 valign=bottom style='width:50.7pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:left'>Class II</p>
  </td>
  <td width=147 valign=bottom style='border-right:1px solid #000000; width:110.1pt;height:12.25pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in' align="center">
  <p style='margin-bottom:.0001pt;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";margin-left:0in; margin-right:0in; margin-top:0in'>2008</p>
  </td>
  <td width=2 valign=bottom style='width:1.6pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
 </tr>
 <tr style='height:12.25pt'>
  <td width=1 valign=bottom style='width:.8pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td width=146 valign=bottom style='border-left:1px solid #000000; border-bottom:1px solid #000000; width:109.3pt;height:12.25pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:left'>Valerio L. Giannini</p>
  </td>
  <td width=59 valign=bottom style='border-bottom:1px solid #000000; width:44.35pt;height:12.25pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:right'>69&nbsp;</p>
  </td>
  <td width=233 valign=bottom style='border-bottom:1px solid #000000; width:175.0pt;height:12.25pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:left'>Director&#185;</p>
  </td>
  <td width=68 valign=bottom style='border-bottom:1px solid #000000; width:50.7pt;height:12.25pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:left'>Class II</p>
  </td>
  <td width=147 valign=bottom style='border-right:1px solid #000000; border-bottom:1px solid #000000; width:110.1pt;height:12.25pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in' align="center">
  <p style='margin-bottom:.0001pt;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";margin-left:0in; margin-right:0in; margin-top:0in'>2008</p>
  </td>
  <td width=2 valign=bottom style='width:1.6pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
 </tr>
</table>

</div>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman"; margin-left:0in; margin-right:0in; margin-top:0in'><a name="_DV_M96"></a>__________________________</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'><a name="_DV_M97">
<font size="3"></font></a><font size="2">(1)
Member of the Audit and Compensation Committees</font></p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:12.0pt;text-indent:.5in; margin-left:0in; margin-right:0in'><a name="_DV_M98"></a>Messrs.
Giannini, Mesenbrink and Isaac are &#147;independent&#148; directors as such term is
defined in Rule 4200(a)(15) of the Nasdaq Marketplace Rules.&nbsp; </p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:12.0pt;text-indent:.5in; margin-left:0in; margin-right:0in'>The Board of
Directors is of the opinion that the election to the Company&#146;s Board of
Directors of the director nominees identified herein, each of whom has
consented to serve if elected, would be in the Company&#146;s best interests. </p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:12.0pt;text-align:center; margin-left:0in; margin-right:0in'><a
name="_DV_M99"></a><b>THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE &#147;FOR&#148;
ELECTION OF THE NOMINEES NAMED BELOW.<a name="_DV_M100"></a></b></p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";margin-top:12.0pt'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-indent:.5in; margin-left:0in; margin-right:0in; margin-top:0in'>George J. Isaac (62), current Class
I director and nominee,<i> </i>is a Certified Public Accountant and has had his
own certified public accounting firm since 2003.&nbsp; Mr. Isaac has served as a consultant
to the Company and its predecessor from 1978 until 1984, was the Company&#146;s
Chief Financial Officer from August 1995 to July 2002, and Secretary from July
2002 to October 2003.&nbsp; Mr. Isaac was a principal in the certified public
accounting firm of Joseph B. Cohan and Associates, Worcester, Massachusetts
from 1978 to 1995.&nbsp; Mr. Isaac is a director of Professional Sales Associates,
Inc., a dental product sales organization, and Commerce Bank &amp; Trust and is
a trustee of Becker
College.&nbsp; Mr. Isaac received a B.S. degree in
Business Administration from Clark University in Worcester, Massachusetts. Mr.
Isaac has been a director of the Company since 1995.</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-indent:.5in'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'>Page 6</p>

<div style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:center'>

<hr size=2 width="100%" noshade color=navy align=center>

</div>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<font face="Times New Roman">

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


</font>


<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:left'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-indent:.5in; margin-left:0in; margin-right:0in; margin-top:0in'>Michael A. Mesenbrink (60), current
Class I director and nominee, has been an associate with Plethora Businesses,
since 2007, conducting mergers and acquisitions, corporate finance, and
business brokerage activities.&nbsp; Prior to that, from 2004 to 2006, he was
CEO of The Center for Advanced Laparoscopic Surgery, a national bariatric
surgery practice and company, and has been in the medical device and health
care industry for 34 years. From 2001 to 2002, he has served as CEO of a multi
national sports medicine company, Innovation Sports, Inc. Prior to that, he
served as Executive Vice President of a public medical device company, Medstone
International. In 1983 he was co founder of Medical Imaging Centers of America
(MICA), a $225MM market cap public company. &nbsp;Mr.
Mesenbrink was formerly with Johnson &amp; Johnson; Becton-Dickinson and has
founded several companies and held many senior management roles in
cardiovascular, surgery, and radiology product based companies.&nbsp; Mr. Mesenbrink
received a BA degree in zoology from San Jose State University in 1970 and did
postgraduate studies at the Menai Bridge Ocean Science Laboratories, University
of Wales, U.K.&nbsp; Mr. Mesenbrink has been a director of the Company since 2002.&nbsp; </p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-indent:.5in; margin-left:0in; margin-right:0in; margin-top:12pt'>William L. Healey (62), Class II
nominee, has been a a private investor and business
consultant since 2006. From 2002 to 2005, he served as President and Chief
Executive Officer of Cal Quality Electronics, an electronics manufacturing
company. Mr. Healey served as a private investor and consultant from 1999 to
2002. He served as Chairman of the Board of Smartflex Systems, an electronics
manufacturing company, from 1996 to 1999 and as its President and Chief
Executive Officer from 1989 to 1999. Prior to 1989, Mr. Healey served in a
number of senior executive positions with Silicon Systems, including Senior
Vice President of Operations. Mr.&nbsp;Healey also serves as a director of
Microsemi Corporation and Sypris Solutions Inc.</p>

<p style='margin:12.0pt 0in; text-align:center;page-break-after:avoid;text-autospace:none;font-family:"Times New Roman";font-weight:bold;'><a name="_DV_M101"></a>CONTINUING
DIRECTORS</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-indent:.5in; margin-left:0in; margin-right:0in; margin-top:0in'>Valerio L. Giannini (69), Class II
Director, has been a principal of Newcap Partners, a Los Angeles based private
investment banking firm since 1995.&nbsp; He previously served as CEO of a
subsidiary of the Geneva Companies, which was then a subsidiary of Chemical
Bank.&nbsp; Mr. Giannini joined Geneva from Cumberland Investment Group, a New
York based private investment banking partnership. Prior to Cumberland, he held
appointments as Director of White House Operations and as a Deputy Assistant
Secretary of Commerce. Mr. Giannini was also previously with the Corporate
Planning Division of IIT Research Institute (Chicago) and the Corporate Finance
department of Kidder, Peabody &amp; Co., New York.&nbsp; Mr. Giannini holds a
B.S.E. from Princeton University. Mr. Giannini has been a director of the
Company since 2002.</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-indent:.5in'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-indent:.5in; margin-left:0in; margin-right:0in; margin-top:0in'>Mark P. Murphy (48), Class III
Director, was appointed the Company&#146;s Chief Executive Officer and President in
August 2006. From September 1995 to August 2006, Mr. Murphy served in senior
executive roles including Executive Vice President, Chief Financial Officer,
Chief Operating Officer and a director of Kyocera Tycom Corporation, a
manufacturing company that designs and sells precision cutting instruments,
where he managed the firm&#146;s 400 employees worldwide.&nbsp; Prior to Kyocera Tycom,
Mr. Murphy was Chief Operating Officer and a director of Dynamotion Corporation
and was with Arthur Young &amp; Co&#146;s audit and consulting practice.&nbsp; Mr. Murphy
earned a B.A. in Business Administration and an M.B.A. in Finance from
California State University at Fullerton.&nbsp; Mr. Murphy has been a director
of the Company since 2002.</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman"; margin-left:0in; margin-right:0in; margin-top:0in'><a name="_DV_M102"></a><a name="_DV_M106"></a>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:avoid; margin-left:0in; margin-right:0in; margin-top:0in'><a
name="_DV_M107"></a><b>BUSINESS EXPERIENCE OF KEY MANAGEMENT</b></p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-indent:.5in; margin-left:0in; margin-right:0in; margin-top:0in'><a name="_DV_M108"></a>Set forth
below is information concerning other non-director key management personnel of
the Company. </p>
<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-indent:.5in'>&nbsp;</p>
<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-indent:.5in; margin-left:0in; margin-right:0in; margin-top:0in'>Jeffrey J.
Ritchey (44), is the Company&#146;s<i> </i>Treasurer, Chief Financial Officer and
Secretary. Mr. Ritchey joined the Company&#146;s Micro Motors subsidiary as
Controller in August 2001 and became the Company&#146;s Chief Financial Officer in
July 2002 and Secretary in October 2003.&nbsp; Mr. Ritchey served as the interim
Chief Executive Officer of the Company from April 2006 to August 2006.&nbsp; Mr.
Ritchey&#146;s previous experience includes serving as the Controller and Finance
Director of Kyocera Tycom Corporation from 1997 to 2001 and corporate and
operational positions at Hughes Electronics and DIRECTV (subsidiaries of
General Motors) from 1990 to 1997.&nbsp; Mr. Ritchey received B. S. degrees in
Economics and Finance and a M.S. degree in Finance from the University of
Arizona and has been a Chartered Financial Analyst (&#147;CFA&#148;) charterholder since
1992.</p>
<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-indent:.5in'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'><a name="_DV_M110"></a><a
name="_DV_M111"></a>Page 7</p>

<div style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:center'>

<hr size=2 width="100%" noshade color=navy align=center>

</div>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<font face="Times New Roman">

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


</font>


<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:left'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";margin-top:12.0pt;text-indent:.5in'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-indent:.5in; margin-left:0in; margin-right:0in; margin-top:0in'>Patrick L. Johnson (46), is the
Company&#146;s<i> </i>Executive Vice President and Chief Business Development
Officer.&nbsp; He joined the Company&#146;s Micro Motors subsidiary as Vice
President and General Manager in March 2000 and served as the President and CEO
of the Company from September 2002 to April 2006
and as a director of the Company from December 2005 to October 2006.&nbsp;
Prior to joining the Company, Mr. Johnson served as General Manager of Analytic
Endodontics, Inc. (a division of Sybron Dental) from 1997 to 2000 and General
Manager of Tycom Dental, Inc. from 1996 to 1997, both dental related product
manufacturers.&nbsp; Prior to that, Mr. Johnson served as Vice-President and General
Manager of Dabico, Inc., a manufacturing company that specialized in the design
and manufacture of in-ground service equipment for commercial and military
aircraft.&nbsp; Mr. Johnson received B.A. degrees in Legal Studies and Philosophy
from the University of California at Santa Cruz and a M.B.A. degree from
Pepperdine University. </p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;page-break-after:avoid;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";font-weight:bold;margin-top:0in'>&nbsp;</p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;page-break-after:avoid;text-autospace:none;font-family:"Times New Roman";font-weight:bold'>BOARD OF
DIRECTORS MEETINGS AND RELATED MATTERS</p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-indent:.5in;text-autospace:none;font-family:"Times New Roman"'><a name="_DV_M121"></a>During the fiscal year ended June 30,
2007, the Board of Directors held seven meetings and there were two actions by
unanimous written consent.&nbsp; Included in the seven meetings were meetings of the
Independent Members Committee that consists of three Board members, Michael A.
Mesenbrink, George Isaac and Valerio L. Giannini.&nbsp; George Isaac replaced Mark
P. Murphy on the Committee in August 2006.&nbsp; The Independent Members Committee
is comprised entirely of non-employee, &#147;independent&#148; directors (as defined in
Rule 4200(a)(15) of the Nasdaq Marketplace Rules).&nbsp; No director attended less
than 75% of the aggregate of all meetings of the Board of Directors and all
meetings of committees of the Board of Directors upon which he served.<a
name="_DV_M122"></a></p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-indent:.5in;text-autospace:none;font-family:"Times New Roman"'>The Board of Directors has an Audit Committee that consists of
three Board members, Michael A. Mesenbrink, George Isaac and Valerio L.
Giannini.&nbsp; Mark P. Murphy was replaced on the Audit Committee by George Isaac
in August 2006.&nbsp; The Audit Committee is comprised entirely of non-employee,
&#147;independent&#148; directors (as defined in Rule 4200(a)(15) of the Nasdaq
Marketplace Rules ) and operates under a written charter adopted by the Board
of Directors.&nbsp; The duties of the Audit Committee include meeting with the
independent public accountants of the Company to review the scope of the annual
audit and to review the quarterly and annual financial statements of the
Company before the statements are released to the Company's shareholders. The
Audit Committee also evaluates the independent public accountants' performance
and makes recommendations to the Board of Directors as to whether the
independent public accounting firm should be retained by the Company for the
ensuing fiscal year.&nbsp; A copy of the Audit Committee&#146;s current charter may be
found at the Company&#146;s website at  www.pro-dex.com .&nbsp;
The charter may be found as follows:&nbsp; From our main web page, first click on
&#148;Investor Relations,&#148; and then click on &#147;Governance,&#148; and then click on &#147;Audit
Committee Charter.&#148;&nbsp; The Audit Committee and Board of Directors have confirmed
that the Audit Committee does and will continue to include at least three
members and has confirmed that Mr. Isaac meets applicable SEC regulations for
designation as an &#147;Audit Committee Financial Expert&#148; and being &#147;independent&#148;
based upon his experience noted herein.&nbsp; The Audit Committee held four meetings
and there was one action by unanimous written consent during the fiscal year
ended June 30, 2007.&nbsp;&nbsp; </p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-indent:.5in; margin-left:0in; margin-right:0in; margin-top:0in'><a name="_DV_M123"></a>The Board of
Directors has a Compensation Committee that consists of three Board members,
Michael A. Mesenbrink, George Isaac and Valerio L. Giannini.&nbsp; George Isaac
replaced Mark P. Murphy on the Compensation Committee in August 2006.&nbsp; The
Compensation Committee is comprised entirely of non-employee, &#147;independent&#148;
directors (as defined in Rule 4200(a)(15) of the Nasdaq Marketplace Rules) and
operates under a written charter adopted by the Board of Directors, a copy of
which may be found at the Company&#146;s website at www.pro-dex.com.&nbsp; The charter
may be found as follows:&nbsp; From our main web page, first click on &#148;Investor
Relations,&#148; then click on &#147;Governance,&#148; and then click on &#147;Compensation
Committee Charter.&#148;&nbsp; The Compensation Committee establishes compensation
policies applicable to the Company&#146;s executive officers.&nbsp; The Compensation
Committee held one meeting during the fiscal year ended June 30, 2007.</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-indent:.5in'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'><a name="_DV_M124"></a>Page
8</p>

<div style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:center'>

<hr size=2 width="100%" noshade color=navy align=center>

</div>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<font face="Times New Roman">

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


</font>


<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:left'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin-right:0in;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";margin-bottom:.0001pt;text-align:justify;text-indent:.5in; margin-left:0in; margin-right:0in; margin-top:0in'>The entire Board of
Directors performs the functions of a nominating committee.&nbsp; In such capacity,
the Board identifies and reviews the qualifications of candidate nominees to
the Board of Directors.&nbsp; The procedures followed by the Board in the nomination
process are set forth in &#147;Procedures as Governing the Nominating Process&#148; which
serves as the Board&#146;s charter concerning nominating matters.&nbsp; The Procedures
may be found on the Company&#146;s website at
 www.pro-dex.com  as follows:&nbsp;&nbsp;&nbsp; From our
main web page, first click on &#148;Investor Relations,&#148; then click on &#147;Governance,&#148;
and then click on &#147;Procedures
as Governing the Nominating Process.&#148;&nbsp;
&nbsp;</p>

<p style='margin-right:0in;margin-left:0in;font-size:12.0pt;font-family:"Arial Unicode MS";margin:0in;margin-bottom:.0001pt;text-align:justify;text-indent:.5in'>&nbsp;</p>

<p style='margin-right:0in;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";margin-bottom:.0001pt;text-align:justify;text-indent:.5in; margin-left:0in; margin-right:0in; margin-top:0in'>The Board will consider
candidate nominees for election as a director who are recommended by
shareholders.&nbsp; Recommendations should be sent to the Secretary of the Company
and should include the candidate's name and qualifications and a statement from
the candidate that he or she consents to being named in the proxy statement and
will serve as a director if elected. In order for any such candidate to be
considered for nomination and, if nominated, to be included in the proxy
statement, such recommendation must be received by the Secretary not less than
120&nbsp;days prior to the anniversary date of the Company's mailing of its
proxy statement for the most recent annual meeting of shareholders.&nbsp; </p>

<p style='margin-right:0in;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";margin-bottom:.0001pt; margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </p>

<p style='margin-right:0in;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";margin-bottom:.0001pt;text-align:justify;text-indent:.5in; margin-left:0in; margin-right:0in; margin-top:0in'>The Board of Directors
believes that it is desirable that directors possess an understanding of the
Company's business environment and have the requisite knowledge, skills,
expertise and diversity of experience such that the Board's ability to manage
and direct the affairs and business of the Company is enhanced.&nbsp;&nbsp; Additional
considerations may include an individual&#146;s capacity to enhance the ability of
committees of the Board to fulfill their duties and/or satisfy any independence
requirements imposed by law, regulation or listing requirements.&nbsp; The Board of
Directors may receive candidate nomination suggestions from current Board members,
Company executive officers or other sources, which may be either unsolicited or
in response to requests from the Board for such candidates.&nbsp; The Board may
also, from time to time, engage firms that specialize in identifying director
candidates.&nbsp; Once a person has been identified by the Board as a potential
candidate, the Board may collect and review publicly available information
regarding the person to assess whether the person should be considered further.
If the Board determines that the candidate warrants further consideration, a
member of the Board may contact the person. Generally, if the person expresses
a willingness to be considered and to serve on the Board, the Board may request
information from the candidate, review the person's accomplishments and
qualifications and may conduct one or more interviews with the candidate.&nbsp; The
Board may consider all such information in light of information regarding any
other candidates that the Board might be evaluating for nomination to the Board
of Directors.&nbsp; Board members may also contact one or more references provided
by the candidate or may contact other members of the business community or
other persons that may have greater first-hand knowledge of the candidate's
accomplishments.&nbsp; With the nominee&#146;s consent, the Board may also engage an
outside firm to conduct background checks on candidates as part of the nominee
evaluation process.&nbsp; The Board's evaluation process does not vary based on the
source of the recommendation.&nbsp; </p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:12.0pt;text-indent:.5in; margin-left:0in; margin-right:0in'>As of June 30,
2007, three of the four members of the Board were &#147;independent&#148; directors (as
defined in Rule 4200(a)(15) of the Nasdaq Marketplace Rules ).&nbsp; No paid
consultants were engaged by the Company, the Board or any of its committees for
the purposes of identifying qualified, interested Board candidates.&nbsp; A copy of
the Board Procedures Concerning Nominations may be found at the Company&#146;s
website at  www.pro-dex.com .&nbsp; The
Procedures may be found as follows:&nbsp; From our main web page, first click on
&#148;Investor Relations,&#148; and then click on &#147;Governance,&#148; and then click on
&#147;Procedures Governing the Nominating Function&#148;.&nbsp; </p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;page-break-after:avoid;text-autospace:none;font-family:"Times New Roman";font-weight:bold'>COMPENSATION
COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:12.0pt;text-indent:.5in; margin-left:0in; margin-right:0in'>No
director or executive officer of the Company serves as an officer, director or
member of a compensation committee of any other entity for which an executive
officer or director thereof is also a member of the Company&#146;s Board of
Directors.</p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;page-break-after:avoid;text-autospace:none;font-family:"Times New Roman";font-weight:bold'><a name="_DV_C96">FAMILY RELATIONSHIPS</a></p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-indent:.5in;text-autospace:none;font-family:"Times New Roman";margin-top:10.0pt'><a name="_DV_C97">There
are no family relationships among the Company&#146;s executive officers and
directors.</a></p>
<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-indent:.5in;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";margin-top:10.0pt'>&nbsp;</p>
<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-indent:.5in;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";margin-top:10.0pt'>&nbsp;</p>
<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-indent:.5in;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";margin-top:10.0pt'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'><a name="_DV_M131"></a>Page
9</p>

<div style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:center'>

<hr size=2 width="100%" noshade color=navy align=center>

</div>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<font face="Times New Roman">

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


</font>


<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:left'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;page-break-after:avoid;text-autospace:none;font-family:"Times New Roman";font-weight:bold'>COMPENSATION OF EXECUTIVE OFFICERS AND MANAGEMENT</p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-indent:.5in;text-autospace:none;font-family:"Times New Roman"'>The following table sets forth certain
compensation information for the fiscal year ended June 30, 2007, by our
principal executive officer and the other two most highly paid executive
officers of the Company serving as such at the end of the fiscal year ended
2007 whose aggregate total annual salary and bonus for such year exceeded
$100,000 (collectively, the &#147;Named Executive Officers&#148;).<a name="_DV_M133"></a><a
name="_DV_M134"></a><a name="_DV_M135"></a><a name="_DV_M136"></a></p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;page-break-after:avoid;text-autospace:none;font-family:"Times New Roman";font-weight:bold'>Summary Compensation Table &#150; 2007</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>

<div align="center">

<table class=MsoNormalTable border=0 cellpadding=0 width=613
 style='width:100%;margin-left:-2.6pt;border-collapse:collapse'>
 <tr>
  <td width=139 valign=bottom style='width:104.5pt;padding:0in 2.9pt 0in 2.9pt'>
  <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid;border:medium none;padding:0in; margin-left:0in; margin-right:0in; margin-top:0in'><b>
	<font size="2">Name and<br>
  Principal Position</font></b></p>
  </div>
  </td>
  <td width=36 valign=bottom style='width:27.0pt;padding:0in 2.9pt 0in 2.9pt'>
  <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid;border:medium none;padding:0in; margin-left:0in; margin-right:0in; margin-top:0in'><b>
	<font size="2">Year</font></b></p>
  </div>
  </td>
  <td width=54 valign=bottom style='width:40.5pt;padding:0in 2.9pt 0in 2.9pt'>
  <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid;border:medium none;padding:0in; margin-left:0in; margin-right:0in; margin-top:0in'><b>
	<font size="2">Salary<br>
  ($)</font></b></p>
  </div>
  </td>
  <td width=43 valign=bottom style='width:32.5pt;padding:0in 2.9pt 0in 2.9pt'>
  <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid;border:medium none;padding:0in; margin-left:0in; margin-right:0in; margin-top:0in'><b>
	<font size="2">Bonus<br>
  ($)</font></b></p>
  </div>
  </td>
  <td width=59 valign=bottom style='width:44.0pt;padding:0in 2.9pt 0in 2.9pt'>
  <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid;border:medium none;padding:0in; margin-left:0in; margin-right:0in; margin-top:0in'><b>
	<font size="2">Stock<br>
  Awards<br>
  ($)(1)</font></b></p>
  </div>
  </td>
  <td width=48 valign=bottom style='width:.5in;padding:0in 2.9pt 0in 2.9pt'>
  <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid;border:medium none;padding:0in; margin-left:0in; margin-right:0in; margin-top:0in'><b>
	<font size="2">Option Awards<br>
  ($)(2)</font></b></p>
  </div>
  </td>
  <td width=84 valign=bottom style='width:63.0pt;padding:0in 2.9pt 0in 2.9pt'>
  <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid;border:medium none;padding:0in; margin-left:0in; margin-right:0in; margin-top:0in'><b>
	<font size="2">Non-Equity<br>
  Incentive<br>
  Plan Compensation<br>
  ($)(3)</font></b></p>
  </div>
  </td>
  <td width=84 valign=bottom style='width:63.0pt;padding:0in 2.9pt 0in 2.9pt'>
  <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid;border:medium none;padding:0in; margin-left:0in; margin-right:0in; margin-top:0in'><b>
	<font size="2">All Other
  Compensation<br>
  ($)(4)</font></b></p>
  </div>
  </td>
  <td width=66 valign=bottom style='width:49.5pt;padding:0in 2.9pt 0in 2.9pt'>
  <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid;border:medium none;padding:0in; margin-left:0in; margin-right:0in; margin-top:0in'><b>
	<font size="2">Total<br>
  ($)</font></b></p>
  </div>
  </td>
 </tr>
 <tr>
  <td width=139 valign=bottom style='width:104.5pt;padding:0in 2.9pt 0in 2.9pt'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:left;page-break-after:avoid; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">Mark P. Murphy </font> <sup><font size="2">(5)(8)(9)</font></sup></p>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:left; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">Director,&nbsp; President and CEO</font></p>
  </td>
  <td width=36 style='width:27.0pt;padding:0in 2.9pt 0in 2.9pt' valign="bottom">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:6.0pt;text-align:center; margin-left:0in; margin-right:0in'>
	<font size="2">2007</font></p>
  </td>
  <td width=54 style='width:40.5pt;padding:0in 2.9pt 0in 2.9pt' valign="bottom">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:6.0pt;text-align:center; margin-left:0in; margin-right:0in'>
	<font size="2">$226,673</font></p>
  </td>
  <td width=43 style='width:32.5pt;padding:0in 2.9pt 0in 2.9pt' valign="bottom">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";page-break-after:avoid; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">&nbsp;&nbsp; $--</font></p>
  </td>
  <td width=59 style='width:44.0pt;padding:0in 2.9pt 0in 2.9pt' valign="bottom">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:6.0pt;text-align:center; margin-left:0in; margin-right:0in'>
	<font size="2">$156,400</font></p>
  </td>
  <td width=48 style='width:.5in;padding:0in 2.9pt 0in 2.9pt' valign="bottom">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:6.0pt;text-align:center; margin-left:0in; margin-right:0in'>
	<font size="2">&nbsp;&nbsp; $--</font></p>
  </td>
  <td width=84 style='width:63.0pt;padding:0in 2.9pt 0in 2.9pt' valign="bottom">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:6.0pt;text-align:center; margin-left:0in; margin-right:0in'>
	<font size="2">&nbsp;&nbsp; $--</font></p>
  </td>
  <td width=84 style='width:63.0pt;padding:0in 2.9pt 0in 2.9pt' valign="bottom">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:6.0pt;text-align:center; margin-left:0in; margin-right:0in'>
	<font size="2">$7,469</font></p>
  </td>
  <td width=66 style='width:49.5pt;padding:0in 2.9pt 0in 2.9pt' valign="bottom">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:6.0pt;text-align:center; margin-left:0in; margin-right:0in'>
	<font size="2">$390,542</font></p>
  </td>
 </tr>
 <tr>
  <td width=139 valign=bottom style='width:104.5pt;padding:4.3pt 2.9pt 0in 2.9pt'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:left;page-break-after:avoid; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">Jeffrey J. Ritchey </font> <sup><font size="2">(6)</font></sup></p>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:left; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">Treasurer, CFO and Secretary </font> </p>
  </td>
  <td width=36 style='width:27.0pt;padding:4.3pt 2.9pt 0in 2.9pt' valign="bottom">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">2007</font></p>
  </td>
  <td width=54 style='width:40.5pt;padding:4.3pt 2.9pt 0in 2.9pt' valign="bottom">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">$147,194</font></p>
  </td>
  <td width=43 style='width:32.5pt;padding:4.3pt 2.9pt 0in 2.9pt' valign="bottom">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">$5,300</font></p>
  </td>
  <td width=59 style='width:44.0pt;padding:4.3pt 2.9pt 0in 2.9pt' valign="bottom">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">&nbsp;&nbsp; $--</font></p>
  </td>
  <td width=48 style='width:.5in;padding:4.3pt 2.9pt 0in 2.9pt' valign="bottom">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">$8,606</font></p>
  </td>
  <td width=84 style='width:63.0pt;padding:4.3pt 2.9pt 0in 2.9pt' valign="bottom">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">$2,931</font></p>
  </td>
  <td width=84 style='width:63.0pt;padding:4.3pt 2.9pt 0in 2.9pt' valign="bottom">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">$9,641</font></p>
  </td>
  <td width=66 style='width:49.5pt;padding:4.3pt 2.9pt 0in 2.9pt' valign="bottom">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">$173,672</font></p>
  </td>
 </tr>
 <tr>
  <td width=139 valign=bottom style='width:104.5pt;padding:4.3pt 2.9pt 0in 2.9pt'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:left;page-break-after:avoid; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">Patrick Johnson <sup>(7)</sup>
  </font>
  </p>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:left;page-break-after:avoid; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">Executive Vice President and Chief Business
  Development Officer, Former Director</font></p>
  </td>
  <td width=36 style='width:27.0pt;padding:4.3pt 2.9pt 0in 2.9pt' valign="bottom">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">2007</font></p>
  </td>
  <td width=54 style='width:40.5pt;padding:4.3pt 2.9pt 0in 2.9pt' valign="bottom">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">$186,923</font></p>
  </td>
  <td width=43 style='width:32.5pt;padding:4.3pt 2.9pt 0in 2.9pt' valign="bottom">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'><font size="2">$--</font></p>
  </td>
  <td width=59 style='width:44.0pt;padding:4.3pt 2.9pt 0in 2.9pt' valign="bottom">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">&nbsp;&nbsp; $--</font></p>
  </td>
  <td width=48 style='width:.5in;padding:4.3pt 2.9pt 0in 2.9pt' valign="bottom">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">&nbsp;&nbsp; $--</font></p>
  </td>
  <td width=84 style='width:63.0pt;padding:4.3pt 2.9pt 0in 2.9pt' valign="bottom">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'><font size="2">$2,250</font></p>
  </td>
  <td width=84 style='width:63.0pt;padding:4.3pt 2.9pt 0in 2.9pt' valign="bottom">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'><font size="2">$11,639</font></p>
  </td>
  <td width=66 style='width:49.5pt;padding:4.3pt 2.9pt 0in 2.9pt' valign="bottom">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">$200,812</font></p>
  </td>
 </tr>
</table>

</div>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-left:.5in;text-indent:-.5in; margin-right:0in; margin-top:0in'>__________________________</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-left:.5in;text-indent:-35.3pt; margin-right:0in; margin-top:0in'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-left:.5in;text-indent:-35.3pt; margin-right:0in; margin-top:0in'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-left:.5in;text-indent:-.5in; margin-right:0in; margin-top:0in'>
<font size="2">(1)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; This column represents the dollar
amount recognized for financial statement reporting purposes with respect to
the year ended June 30, 2007 for the fair value of stock awards granted to each
of our Named Executive Officers calculated in accordance with SFAS 123R.&nbsp;
Pursuant to SEC rules, the amounts shown exclude the impact of estimated
forfeitures related to service-based vesting conditions.&nbsp; For additional
information on the valuation assumptions with respect to the restricted stock
awards, refer to Note 6 of our financial statements in our Annual Report on Form 10-KSB for the year ended
June 30, 2007, as filed with the SEC.&nbsp; These
amounts reflect only our accounting expense for these stock awards and do not
correspond to the actual value that will be recognized by our Named Executive
Officers.&nbsp; </font>
</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman"; margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-left:.5in;text-indent:-35.3pt; margin-right:0in; margin-top:0in'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-left:.5in;text-indent:-.5in; margin-right:0in; margin-top:0in'>
<font size="2">(2)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; &nbsp;This column represents the dollar
amount recognized for financial statement reporting purposes with respect to
the year ended June 30, 2007 for the fair value of stock options granted to
each of our Named Executive Officers calculated in accordance with SFAS 123R.&nbsp;
Pursuant to SEC rules, the amounts shown exclude the impact of estimated
forfeitures related to service-based vesting conditions.&nbsp; For additional
information on the valuation assumptions with respect to these option grants,
refer to Notes 2 and 6 of our financial statements in our Annual Report on Form 10-KSB for the year ended
June 30, 2007, as filed with the SEC. &nbsp;These
amounts reflect only our accounting expense for these option grants and do not
correspond to the actual value that will be recognized by our Named Executive
Officers.&nbsp; See the Outstanding Equity Awards at June 30, 2007 table below for
more information on options held by the Named Executive Officers.&nbsp; Stock
options awarded have a term of ten years; vest in equal annual installments
over a period of up to five years, and an exercise price equal to the Company&#146;s
closing price for its Common Stock on the Nasdaq Capital Market on the date of
grant.</font></p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman"; margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-left:.7pt; margin-right:0in; margin-top:0in'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-left:.5in;text-indent:-.5in; margin-right:0in; margin-top:0in'>
<font size="2">(3)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Non-equity incentive plan
compensation payments were made in cash in the second quarter for first quarter
performance due to the achievement of the Company&#146;s quarterly internal
operating targets. Operating targets were not met in the remaining three
quarters and, accordingly, no payments were made corresponding to such
quarters.</font></p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-left:.25in; margin-right:0in; margin-top:0in'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-left:.5in;text-indent:-.5in; margin-right:0in; margin-top:0in'>
<font size="2">(4)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;All Other Compensation consists
of:</font></p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-left:71.5pt;text-indent:-44.0pt; margin-right:0in; margin-top:0in'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'>Page 10</p>

<div style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:center'>

<hr size=2 width="100%" noshade color=navy align=center>

</div>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<font face="Times New Roman">

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


</font>


<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:left'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>

<div align="center">

<table class=MsoNormalTable border=0 cellpadding=0 width=468
 style='width:75%;margin-left:67.5pt;border-collapse:collapse'>
 <tr>
  <td valign=bottom style='padding:0in; '>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";page-break-after:avoid; margin-left:0in; margin-right:0in; margin-top:0in'><b>
	<font size="2">&nbsp;</font></b></p>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";page-break-after:avoid; margin-left:0in; margin-right:0in; margin-top:0in'><b>
	<font size="2">&nbsp;</font></b></p>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";page-break-after:avoid; margin-left:0in; margin-right:0in; margin-top:0in'><b>
	<font size="2">&nbsp;</font></b></p>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";page-break-after:avoid; margin-left:0in; margin-right:0in; margin-top:0in'><b><u>
	<font size="2">Name </font> </u></b></p>
  </td>
  <td valign=bottom style='padding:0in; '>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid'>&nbsp;</p>
  </td>
  <td style='padding:0in; ' valign="bottom">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'><b><font size="2">Health insurance and <br>
	related
  payments</font></b></p>
  </td>
  <td style='padding:0in; ' valign="bottom">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'><b><font size="2">Matching contributions to the
  <br>
	Company&#146;s 401(k) plan</font></b></p>
  </td>
 </tr>
 <tr style='height:18.9pt'>
  <td valign=bottom style='padding:0in;
  '>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";page-break-after:avoid; margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp;</p>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";page-break-after:avoid; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">Mark P. Murphy</font></p>
  </td>
  <td valign=bottom style='padding:0in;
  '>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";page-break-after:avoid'>&nbsp;</p>
  </td>
  <td valign=bottom style='padding:0in;
  '>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp;</p>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'><font size="2">$7,065</font></p>
  </td>
  <td valign=bottom style='padding:0in;
  '>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp;</p>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'><font size="2">$404</font></p>
  </td>
 </tr>
 <tr style='height:22.5pt'>
  <td valign=bottom style='padding:0in;
  '>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:left;page-break-after:avoid; margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp;</p>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:left;page-break-after:avoid; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">Jeffrey J. Ritchey </font> </p>
  </td>
  <td valign=bottom style='padding:0in;
  '>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";page-break-after:avoid'>&nbsp;</p>
  </td>
  <td valign=bottom style='padding:0in;
  '>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp;</p>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'><font size="2">$7,699</font></p>
  </td>
  <td valign=bottom style='padding:0in;
  '>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp;</p>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'><font size="2">$1,942</font></p>
  </td>
 </tr>
 <tr style='height:22.5pt'>
  <td valign=bottom style='padding:0in;
  '>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";page-break-after:avoid; margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp;</p>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";page-break-after:avoid; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">Patrick Johnson </font> </p>
  </td>
  <td valign=bottom style='padding:0in;
  '>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";page-break-after:avoid; margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp;</p>
  </td>
  <td valign=bottom style='padding:0in;
  '>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp;</p>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'><font size="2">$9,318</font></p>
  </td>
  <td valign=bottom style='padding:0in;
  '>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp;</p>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'><font size="2">$2,321</font></p>
  </td>
 </tr>
</table>

</div>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";margin-top:0in;margin-right:.5pt;margin-bottom:0in;
margin-left:71.5pt;margin-bottom:.0001pt;text-indent:-44.0pt'><a name="_DV_M137">
<font size="3"></font></a><font size="3">&nbsp;</font></p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";margin-top:0in;margin-right:.5pt;margin-bottom:0in;
margin-left:.5in;margin-bottom:.0001pt;text-indent:-.5in'><font size="2">(5)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Mr. Murphy was elected a Director of the
Company in August, 2002 and commenced employment with the Company as President and Chief Executive Officer in August 2006.</font></p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:0in;margin-right:.5pt;margin-bottom:0in;
margin-left:71.5pt;margin-bottom:.0001pt;text-indent:-44.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";margin-top:0in;margin-right:.5pt;margin-bottom:0in;
margin-left:.5in;margin-bottom:.0001pt;text-indent:-.5in'><font size="2">(6)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Mr. Ritchey commenced employment with
the Company in August 2001 and was named Treasurer and Chief Financial Officer in July 2002
and Secretary in October 2003.&nbsp; Mr. Ritchey
was appointed interim President and Chief Executive Officer in April 2006 after
the resignation of Mr. Johnson and held those officer positions until the
appointment of the Company&#146;s current President and Chief Executive Officer,
Mark P. Murphy, in August 2006.</font></p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:0in;margin-right:.5pt;margin-bottom:0in;
margin-left:71.5pt;margin-bottom:.0001pt;text-indent:-44.0pt'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:0in;margin-right:.5pt;margin-bottom:0in;
margin-left:.5in;margin-bottom:.0001pt;text-indent:-.5in'><font size="2">(7)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Mr. Johnson commenced employment with
the Company in April&nbsp;2000 and was named President and Chief Executive
Officer in September 2002. Mr. Johnson resigned as President and Chief
Executive Officer in April 2006, at which time he was appointed Executive Vice
President and Chief Business Development Officer. Mr. Johnson resigned as a
Director in October 2006.</font></p>
<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";margin-top:0in;margin-right:.5pt;margin-bottom:0in;
margin-left:.5in;margin-bottom:.0001pt;text-indent:-.5in'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-left:.5in;text-indent:-.5in;text-autospace:
ideograph-numeric ideograph-other; margin-right:0in; margin-top:0in'>
<font size="2">(8)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Under
the terms of his employment agreement, on February 21, 2007, Mr. Murphy
received a grant of 340,000 restricted shares of the Company's Common Stock in
replacement of his stock appreciation rights previously awarded upon execution
of such agreement.&nbsp; The restricted shares vest at the rate of 85,000 shares per
year commencing on the grant date which vesting is subject to acceleration upon
certain liquidity events as described under &#147;Employment Agreement with Mark
Murphy.&#148;&nbsp; </font> </p>
<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";margin-left:.5in;text-indent:-.5in;text-autospace:
ideograph-numeric ideograph-other'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:0in;margin-right:.5pt;margin-bottom:0in;
margin-left:.5in;margin-bottom:.0001pt;text-indent:-.5in'><font size="2">(9)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Included in the Salary and Total for Mr.
Murphy is $3,750 of director fees earned prior to his becoming an employee of
the Company. </font> <a name="_DV_M138"><font size="2"></font></a></p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman"'><b>Employment Agreements and Executive Compensation</b></p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:0in;margin-right:.5pt;margin-bottom:0in;
margin-left:71.5pt;margin-bottom:.0001pt;text-indent:-44.0pt'>&nbsp;</p>

<p style='margin-right:0in;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";text-align:justify;text-indent:.5in'><b>Employment Agreement with Mark Murphy.</b></p>

<p style='margin-right:0in;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";text-align:justify;text-indent:.5in'>Mr. Murphy has an employment agreement (&#147;Murphy
Employment Agreement&#148;) with the Company<font size="3"> </font>dated August 14, 2006,
concerning his employment as the Company's President and Chief Executive
Officer. Under
the terms of the Murphy
Employment Agreement,
Mr. Murphy is to receive an annual salary of $280,000, subject to annual CPI
adjustment, plus health and life insurance benefits available to all Company
employees. </p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-indent:.5in;text-autospace:ideograph-numeric ideograph-other; margin-left:0in; margin-right:0in; margin-top:0in'>In
addition to the foregoing salary and benefits, Mr. Murphy is eligible for
additional compensation if he remains employed by the Company on a full time
basis (&quot;Continuing Employment Status&quot;) including the following: </p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'>Page 11</p>

<div style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:center'>

<hr size=2 width="100%" noshade color=navy align=center>

</div>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<font face="Times New Roman">

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


</font>


<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:left'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-indent:.5in;text-autospace:ideograph-numeric ideograph-other; margin-left:0in; margin-right:0in; margin-top:0in'>An
annual bonus equal to (i) 0.75% of his annual salary, times (ii) each one
percent (or any portion thereof) increases in pre-tax earnings (including
extraordinary gains and losses) per share for fiscal years ending after July 1,
2006 over the prior fiscal year. The annual bonus shall be payable within ten
days after Mr. Murphy has signed and the Company has filed with the Securities
and Exchange Commission (&#147;SEC&#148;)
the required Chief Executive Officer certifications, without qualification, for
Form 10-KSB (or Form 10-K, as the case may be) for the
most recent fiscal year. Such Continuing Employment Status shall not be
required for additional compensation under the &quot;annual bonus&quot;
benefits in the event that during the period (i) following the conclusion of
the Company's fiscal year and (ii) prior to the Company's filing of Form 10-KSB
(or Form 10-K, as the case may be), his employment is terminated by the Company
without &quot;Cause&quot; or he resigns for &quot;Good Reason,&quot; each as
defined below. If his employment has been terminated by the Company without
Cause prior to the time that he has signed such certifications, or by Mr.
Murphy for Good Reason prior to the time that he has signed such
certifications, the annual bonus shall be payable within thirty (30) days
following the termination of his employment.&nbsp; The actual annual bonus for
fiscal year ending June 30, 2007 shall not exceed $25,000; and shall not exceed
$50,000 for fiscal year ending June 30, 2008.&nbsp; The bonus is not limited for
fiscal years ending after June 30, 2008.&nbsp; There was no annual bonus for the
fiscal year ending June 20, 2007 earned or paid.&nbsp; </p>
<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-indent:.5in;text-autospace:ideograph-numeric ideograph-other'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-indent:.5in;text-autospace:ideograph-numeric ideograph-other; margin-left:0in; margin-right:0in; margin-top:0in'>The
agreement also provides for a second bonus equal to the appreciation of an
aggregate of 450,000 shares of the Company's Common Stock over the closing
price of such number of shares on the day preceding the starting date of his
employment with the Company. Entitlement to this second bonus was to vest at
the rate of 33.333% per year commencing with the first anniversary of such
starting date (subject to acceleration in certain events as described below),
and all or any part of each incremental vested portion was to be exercisable
within five years from the date such increment first vested and payable in cash
in installments.</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-indent:.5in;text-autospace:ideograph-numeric ideograph-other; margin-left:0in; margin-right:0in; margin-top:0in'>The
second bonus may be replaced at the Company's sole option on or before February
28, 2007 with a grant of 340,000 restricted shares of the Company's Common
Stock of the Company in accordance with an equity incentive compensation plan
vesting at the rate of 85,000 shares per year commencing January 2, 2007 or the
grant date, whichever is later. If the restricted stock grant is pursuant to
the Company's general equity incentive plan for its key employees as approved
by the Company's Board of Directors and shareholders, then the Company is
obligated to register such shares with the SEC.&nbsp; The Company replaced the stock
appreciation rights with the restricted stock grant in February, 2007 and
registered the shares with the SEC.</p>
<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-indent:.5in;text-autospace:ideograph-numeric ideograph-other'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-indent:.5in;text-autospace:ideograph-numeric ideograph-other; margin-left:0in; margin-right:0in; margin-top:0in'>In
the event of a transaction in which the Company's shareholders receive cash or
marketable securities for their shares of stock of the Company (a
&quot;Liquidity Event&quot;), the vesting of the unvested restricted shares or
portion of the second bonus will accelerate immediately prior to the Liquidity
Event based on the amount received by the Company's shareholders for their
shares: 100% of the unvested&nbsp; restricted shares if the consideration received
by Pro-Dex shareholders is $5 per share or greater; 80% if between $4 and $5;
and 60% if between $3 and $4. </p>
<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-indent:.5in;text-autospace:ideograph-numeric ideograph-other'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-indent:.5in;text-autospace:ideograph-numeric ideograph-other; margin-left:0in; margin-right:0in; margin-top:0in'>In
the event Mr. Murphy is terminated involuntarily by the Company without
&quot;Cause&quot; or resigns with &quot;Good Reason&quot; as defined below, the
Company shall pay him his (i) annual salary up through the date of termination
plus (ii) accrued vacation plus (iii) severance equal to $280,000 and (iv) any
annual bonus or second bonus earned but not yet paid as of the termination
date.&nbsp; With the exception of the earned amount of his annual bonus (to be paid
within thirty (30) days of his termination), the severance payment referred to
above shall be made in equal incremental payments over a period of twelve (12)
months from the termination date. </p>
<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-indent:.5in;text-autospace:ideograph-numeric ideograph-other'>&nbsp;</p>
<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-indent:.5in;text-autospace:ideograph-numeric ideograph-other; margin-left:0in; margin-right:0in; margin-top:0in'>The Murphy
Employment Agreement defines &quot;Cause&quot; as termination due to: (i) Mr.
Murphy's failure or inability to perform his duties with the Company or a
related entity; (ii) his failure to substantially follow and comply with the
specific and lawful directives of the Board or any officer of the Company or a
related entity to whom he reports directly; (iii) the Board's determination on
advice of counsel of his commission of an act of fraud or dishonesty; his
engagement in illegal conduct, gross misconduct or an act of moral turpitude;
or his material violation of any material written policy, guideline, code,
handbook or similar document governing the conduct of directors, officers or
employees of the Company or its related entities; or (iv) a material breach by
Mr. Murphy of the terms of the Murphy Employment Agreement. The Murphy
Employment Agreement defines &quot;Good Reason&quot; as: (i) a reduction in Mr.
Murphy's salary or failure of the Company to pay any amount owing to him under
the Murphy Employment Agreement when due; or a material reduction in benefits
provided to him under the Murphy Employment Agreement; (ii) the Company's
requiring him to be based full time in any office or location outside of a
sixty (60) mile radius from his current residence in Yorba Linda, California;
(iii) his being requested by the Board to execute any documents or take any
action in violation of any laws or regulations applicable to the Company,
commit an act of fraud or dishonesty violation of any material written policy,
guideline, code, handbook or similar document governing the conduct of
directors, officers or employees of the Company or its related entities; (iv) a
Liquidity Event, in which he is not offered an executive position with
substantially comparable compensation, benefits and incentives with any successor
to the Company based in any office or location inside a sixty (60) miles radius
from his current residence in Yorba Linda; California; or (v) a material breach
by the Company of the Murphy Employment Agreement.&nbsp; Both the Company and Mr.
Murphy have a 30 day cure period following a notice of &quot;Cause&quot; or
&quot;Good Reason&quot; as the case may be.</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'>Page 12</p>

<div style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:center'>

<hr size=2 width="100%" noshade color=navy align=center>

</div>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<font face="Times New Roman">

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


</font>


<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:left'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-indent:.5in;text-autospace:none;font-family:"Times New Roman"'>
<b>Employment Agreement with Patrick Johnson</b></p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-indent:.5in;text-autospace:none;font-family:"Times New Roman"'>Mr. Johnson has an employment agreement (&#147;Johnson
Employment Agreement&#148;) with the Company dated April 12, 2006, as amended
October 18, 2006, concerning his employment as the Company&#146;s Executive Vice
President and Chief Business Development Officer.&nbsp; Under the terms of the
Johnson Employment Agreement, Mr. Johnson is to receive an annual salary of
$180,000 and is entitled to severance equal to four months of his annual salary
if he is terminated involuntarily.</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:0in;margin-right:.5pt;margin-bottom:0in;
margin-left:71.5pt;margin-bottom:.0001pt;text-indent:-44.0pt'>&nbsp;</p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman"'><b>Outstanding Equity Awards At Fiscal Year End</b></p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-indent:.5in;text-autospace:none;font-family:"Times New Roman"'>The following table sets forth information about outstanding
equity awards held by our Named Executive Officers as of June 30, 2007.</p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;page-break-after:avoid;text-autospace:none;font-family:"Times New Roman";font-weight:bold'>Outstanding Equity Awards at June 30, 2007</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";page-break-after:avoid'>&nbsp;</p>

<div align="center">

<table class=MsoNormalTable border=0 cellpadding=0 width=473
 style='width:90%;margin-left:0in;border-collapse:collapse'>
 <tr style='page-break-inside:avoid;height:19.35pt'>
  <td valign=bottom style='height:19.35pt; padding-left:.05in; padding-right:.05in; padding-top:0in; padding-bottom:0in'>
  <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid;border:medium none;padding:0in; margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp;</p>
  </div>
  </td>
  <td colspan=4 valign=top style='height:19.35pt; padding-left:5.4pt; padding-right:5.4pt; padding-top:0in; padding-bottom:0in'>
  <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in;
  margin-left:0in;margin-right:-.9pt'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";page-break-after:avoid;border:medium none;padding:0in; margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp;</p>
  <p style='margin-bottom:.0001pt;text-align:center;text-autospace:none;font-family:"Times New Roman";page-break-after:avoid;border:medium none;padding:0in; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">&nbsp;Option Awards</font></p>
  </div>
  </td>
  <td colspan=2 valign=bottom style='height:19.35pt; padding-left:.05in; padding-right:.05in; padding-top:0in; padding-bottom:0in'>
  <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid;border:medium none;padding:0in; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">Stock Awards</font></p>
  </div>
  </td>
 </tr>
 <tr style='page-break-inside:avoid;height:43.0pt'>
  <td rowspan=2 valign=bottom style='height:43.0pt; padding-left:.05in; padding-right:.05in; padding-top:0in; padding-bottom:0in'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp;</p>
  </td>
  <td valign=bottom style='height:43.0pt; padding-left:.05in; padding-right:.05in; padding-top:0in; padding-bottom:0in'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'><font size="2">Number<br>
  of<br>
  Securities</font></p>
  </td>
  <td valign=bottom style='height:43.0pt; padding-left:.05in; padding-right:.05in; padding-top:0in; padding-bottom:0in'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'><font size="2">Number<br>
  of<br>
  Securities</font></p>
  </td>
  <td valign=bottom style='height:43.0pt; padding-left:.05in; padding-right:.05in; padding-top:0in; padding-bottom:0in'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp;</p>
  </td>
  <td valign=bottom style='height:43.0pt; padding-left:.05in; padding-right:.05in; padding-top:0in; padding-bottom:0in'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp;</p>
  </td>
  <td rowspan=2 valign=bottom style='height:43.0pt; padding-left:.05in; padding-right:.05in; padding-top:0in; padding-bottom:0in'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'><font size="2">Number<br>
  of Shares<br>
  or Units<br>
  of Stock<br>
  That Have<br>
  Not<br>
  Vested<br>
  (#)</font></p>
  </td>
  <td rowspan=2 valign=bottom style='height:43.0pt; padding-left:.05in; padding-right:.05in; padding-top:0in; padding-bottom:0in'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'><font size="2">Market<br>
  Value of<br>
  Shares or<br>
  Units of<br>
  Stock<br>
  That Have<br>
  Not<br>
  Vested<br>
  ($)</font></p>
  </td>
 </tr>
 <tr style='page-break-inside:avoid;height:5.85pt'>
  <td valign=bottom style='height:5.85pt; padding-left:.05in; padding-right:.05in; padding-top:0in; padding-bottom:0in'>
  <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid;border:medium none;padding:0in; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">Underlying<br>
  Unexercised<br>
  Options<br>
  (#)<br>
  Exercisable</font></p>
  </div>
  </td>
  <td valign=bottom style='height:5.85pt; padding-left:.05in; padding-right:.05in; padding-top:0in; padding-bottom:0in'>
  <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid;border:medium none;padding:0in; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">Underlying<br>
  Unexercised<br>
  Options<br>
  (#)<br>
  Unexercisable</font></p>
  </div>
  </td>
  <td valign=bottom style='height:5.85pt; padding-left:.05in; padding-right:.05in; padding-top:0in; padding-bottom:0in'>
  <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid;border:medium none;padding:0in; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">Option <br>
  Exercise<br>
  Price<br>
  ($)</font></p>
  </div>
  </td>
  <td valign=bottom style='height:5.85pt; padding-left:.05in; padding-right:.05in; padding-top:0in; padding-bottom:0in'>
  <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid;border:medium none;padding:0in; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">Option<br>
  Expiration<br>
  Date</font></p>
  </div>
  </td>
 </tr>
 <tr>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:0in; padding-bottom:0in'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:6.0pt;page-break-after:avoid; margin-left:0in; margin-right:0in'>
	<font size="2">Mark P. Murphy</font></p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:0in; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-autospace:none;font-family:"Times New Roman";margin-top:6.0pt;page-break-after:avoid; margin-left:0in; margin-right:0in' align="center">
	<font size="2">15,000</font></p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:0in; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:center;text-autospace:none;font-family:"Times New Roman";margin-top:6.0pt;page-break-after:avoid; margin-left:0in; margin-right:0in'>
	<font size="2">--</font></p>
  </td>
  <td style='padding-left:.05in; padding-right:.05in; padding-top:0in; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'><font size="2">$2.67</font></p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:0in; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:6.0pt;text-align:center;
  page-break-after:avoid; margin-left:0in; margin-right:0in'><font size="2">9/29/2014</font></p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:0in; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:6.0pt;text-align:center;
  page-break-after:avoid; margin-left:0in; margin-right:0in'><font size="2">--</font></p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:0in; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:6.0pt;text-align:center;
  page-break-after:avoid; margin-left:0in; margin-right:0in'><font size="2">--</font></p>
  </td>
 </tr>
 <tr>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";page-break-after:avoid; margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp;</p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:center;text-autospace:none;font-family:"Times New Roman";page-break-after:avoid; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">15,000</font></p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:center;text-autospace:none;font-family:"Times New Roman";page-break-after:avoid; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">--</font></p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'><font size="2">$3.24</font></p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'><font size="2">9/28/2015</font></p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'><font size="2">--</font></p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'><font size="2">--</font></p>
  </td>
 </tr>
 <tr>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";page-break-after:avoid; margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp;</p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:center;text-autospace:none;font-family:"Times New Roman";page-break-after:avoid; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">--</font></p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:center;text-autospace:none;font-family:"Times New Roman";page-break-after:avoid; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">--</font></p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'><font size="2">--</font></p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'><font size="2">--</font></p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'><font size="2">226,667</font></p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'><font size="2">$312,800</font></p>
  </td>
 </tr>
 <tr>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";page-break-after:avoid; margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp;</p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:center;text-autospace:none;font-family:"Times New Roman";page-break-after:avoid; margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp;</p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";page-break-after:avoid; margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp;</p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp;</p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp;</p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp;</p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";page-break-after:avoid; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">Jeffrey J. Ritchey</font></p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:center;text-autospace:none;font-family:"Times New Roman";page-break-after:avoid; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">20,000</font></p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:center;text-autospace:none;font-family:"Times New Roman";page-break-after:avoid; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">--</font></p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'><font size="2">$1.12</font></p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'><font size="2">7/31/11</font></p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'><font size="2">--</font></p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'><font size="2">--</font></p>
  </td>
 </tr>
 <tr>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";page-break-after:avoid; margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp;</p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:center;text-autospace:none;font-family:"Times New Roman";page-break-after:avoid; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">20,000</font></p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:center;text-autospace:none;font-family:"Times New Roman";page-break-after:avoid; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">--</font></p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'><font size="2">$0.81</font></p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'><font size="2">12/31/11</font></p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'><font size="2">--</font></p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'><font size="2">--</font></p>
  </td>
 </tr>
 <tr>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";page-break-after:avoid; margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp;</p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:center;text-autospace:none;font-family:"Times New Roman";page-break-after:avoid; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">60,000</font></p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:center;text-autospace:none;font-family:"Times New Roman";page-break-after:avoid; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">--</font></p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'><font size="2">$0.42</font></p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'><font size="2">9/26/12</font></p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'><font size="2">--</font></p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'><font size="2">--</font></p>
  </td>
 </tr>
 <tr>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";page-break-after:avoid; margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp;</p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:center;text-autospace:none;font-family:"Times New Roman";page-break-after:avoid; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">15,000</font></p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:center;text-autospace:none;font-family:"Times New Roman";page-break-after:avoid; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">5,000</font></p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'><font size="2">$2.90</font></p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'><font size="2">5/17/15</font></p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'><font size="2">--</font></p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'><font size="2">--</font></p>
  </td>
 </tr>
 <tr>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";page-break-after:avoid; margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp;</p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:center;text-autospace:none;font-family:"Times New Roman";page-break-after:avoid; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">--</font></p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:center;text-autospace:none;font-family:"Times New Roman";page-break-after:avoid; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">6,000</font></p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'><font size="2">$1.45</font></p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'><font size="2">11/30/16</font></p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'><font size="2">--</font></p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'><font size="2">--</font></p>
  </td>
 </tr>
 <tr>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";page-break-after:avoid; margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp;</p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:center;text-autospace:none;font-family:"Times New Roman";page-break-after:avoid; margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp;</p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:center;text-autospace:none;font-family:"Times New Roman";page-break-after:avoid; margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp;</p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp;</p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp;</p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp;</p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";page-break-after:avoid; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">Patrick Johnson</font></p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:center;text-autospace:none;font-family:"Times New Roman";page-break-after:avoid; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">125,000</font></p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:center;text-autospace:none;font-family:"Times New Roman";page-break-after:avoid; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">--</font></p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'><font size="2">$2.18</font></p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'><font size="2">3/7/10</font></p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'><font size="2">--</font></p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'><font size="2">--</font></p>
  </td>
 </tr>
 <tr>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";page-break-after:avoid; margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp;</p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:center;text-autospace:none;font-family:"Times New Roman";page-break-after:avoid; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">75,000</font></p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:center;text-autospace:none;font-family:"Times New Roman";page-break-after:avoid; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">--</font></p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'><font size="2">$1.08</font></p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'><font size="2">6/29/11</font></p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'><font size="2">--</font></p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'><font size="2">--</font></p>
  </td>
 </tr>
 <tr>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";page-break-after:avoid; margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp;</p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:center;text-autospace:none;font-family:"Times New Roman";page-break-after:avoid; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">112,500</font></p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:center;text-autospace:none;font-family:"Times New Roman";page-break-after:avoid; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">--</font></p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'><font size="2">$0.81</font></p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'><font size="2">12/31/11</font></p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'><font size="2">--</font></p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'><font size="2">--</font></p>
  </td>
 </tr>
 <tr>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";page-break-after:avoid; margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp;</p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:center;text-autospace:none;font-family:"Times New Roman";page-break-after:avoid; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">100,000</font></p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:center;text-autospace:none;font-family:"Times New Roman";page-break-after:avoid; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">--</font></p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'><font size="2">$1.42</font></p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'><font size="2">9/5/12</font></p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'><font size="2">--</font></p>
  </td>
  <td valign=top style='padding-left:.05in; padding-right:.05in; padding-top:2.9pt; padding-bottom:0in' align="right">
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;page-break-after:
  avoid; margin-left:0in; margin-right:0in; margin-top:0in'><font size="2">--</font></p>
  </td>
 </tr>
</table>

</div>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-indent:.5in;text-autospace:none;font-family:"Times New Roman"'><b>&nbsp;</b></p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-left:.5in;text-indent:-35.3pt; margin-right:0in; margin-top:0in'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-left:.5in;text-indent:-35.3pt; margin-right:0in; margin-top:0in'>
<font size="2">(1)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; All of Mr. Murphy&#146;s and Mr. Johnson&#146;s
options have vested.&nbsp;&nbsp; Mr. Ritchey&#146;s options vest through December 2010 as
follows:&nbsp; 5,000 at $2.90 in December 2007, 1,500 at $1.45 in each of December
2007, December 2008, December 2009 and December 2010.&nbsp;&nbsp; </font> </p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-left:.5in;text-indent:-35.3pt; margin-right:0in; margin-top:0in'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-left:.5in;text-indent:-.5in; margin-right:0in; margin-top:0in'>
<font size="2">(2)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Mr. Murphy&#146;s restricted stock grant of
340,000 shares was awarded in February 2007 and 85,000 shares immediately
vested upon grant, leaving 255,000 shares unvested at February 2007.&nbsp; In the
four months from February 2007 through June 2007, an additional 28,333 shares
vested at a rate of 7,083.33 shares per month, leaving 226,667 shares unvested
as of June 30, 2007.</font></p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";margin-top:12.0pt'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'>Page 13</p>

<div style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:center'>

<hr size=2 width="100%" noshade color=navy align=center>

</div>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<font face="Times New Roman">

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


</font>


<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'><b><font style="font-size: 12.0pt">Compensation
of Directors</font></b></p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:left'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:12.0pt;text-indent:.5in; margin-left:0in; margin-right:0in'>Directors of the
Company who are not also employees receive a fee of $3,000 per quarter plus
$1,000 per board meeting, plus $750 per each day of committee meetings
attended, together with reasonable expenses of attendance at board meetings and
committee meetings. The Company&#146;s shareholders have approved the 2004 Director
Stock Option Plan pursuant to which non-employee directors may be granted
options to purchase shares of the Company&#146;s Common Stock. In accordance with
the 2004 Director Stock Option Plan&#146;s provisions, the Board of Directors
previously adopted a policy to grant each outside director an initial option to
purchase 20,000 shares of Common Stock on the date of his commencement of
service as a director and an option to purchase 15,000 shares on each
anniversary date of such service, exercisable at the closing price of the
Company&#146;s Common Stock on the Nasdaq Capital Market on the date of such grant.
The maximum term of each option is ten years. The options fully vest after 6
months and expire 90 days from the termination of the director&#146;s service on the
Company&#146;s Board of Directors.</p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-indent:.5in;text-autospace:none;font-family:"Times New Roman";text-indent:0in'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; The directors&#146; fees paid in
the fiscal year ended June 30, 2007 are as follows:</p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-indent:.5in;text-autospace:none;font-family:"Times New Roman";text-align:center;text-indent:0in'><b>Director
Compensation</b></p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman"; margin-left:0in; margin-right:0in; margin-top:0in'><b>&nbsp;</b></p>

<div align="left">

<table class=MsoNormalTable border=0 cellpadding=0
 style='margin-left:35.8pt;border-collapse:collapse' width="50%">
 <tr style='height:45.9pt'>
  <td width=132 valign=bottom style='width:98.8pt;padding:0in 4.3pt 0in 4.3pt;
  height:45.9pt'>
  <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;border:medium none;
  padding:0in; margin-left:0in; margin-right:0in; margin-top:0in'><b>
	<font size="2">Name</font></b></p>
  </div>
  </td>
  <td width=72 valign=bottom style='width:.75in;padding:0in 4.3pt 0in 4.3pt;
  height:45.9pt'>
  <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;border:medium none;
  padding:0in; margin-left:0in; margin-right:0in; margin-top:0in'><b>
	<font size="2">Fees Earned<br>
  or Paid<br>
  in Cash<br>
  ($)</font></b></p>
  </div>
  </td>
  <td width=64 valign=bottom style='width:48.05pt;padding:0in 4.3pt 0in 4.3pt;
  height:45.9pt'>
  <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:center;border:none;
  padding:0in'><b><font size="2">Option Awards<br>
  ($)</font><sup><font size="2">(1)</font></sup></b></p>
  </div>
  </td>
  <td width=63 valign=bottom style='width:47.4pt;padding:0in 4.3pt 0in 4.3pt;
  height:45.9pt'>
  <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center;border:medium none;
  padding:0in; margin-left:0in; margin-right:0in; margin-top:0in'><b>
	<font size="2">Total<br>
  ($)</font></b></p>
  </div>
  </td>
 </tr>
 <tr>
  <td width=132 valign=top style='width:98.8pt;padding:0in 4.3pt 0in 4.3pt'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:6.0pt; margin-left:0in; margin-right:0in'>
	<font size="2">George
  J. Isaac(2)</font></p>
  </td>
  <td width=72 valign=top style='width:.75in;padding:0in 4.3pt 0in 4.3pt'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:6.0pt;text-align:center; margin-left:0in; margin-right:0in'>
	<font size="2">18,500</font></p>
  </td>
  <td width=64 valign=top style='width:48.05pt;padding:0in 4.3pt 0in 4.3pt'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:6.0pt;text-align:center; margin-left:0in; margin-right:0in'>
	<font size="2">15,389</font></p>
  </td>
  <td width=63 valign=top style='width:47.4pt;padding:0in 4.3pt 0in 4.3pt'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:6.0pt;text-align:center; margin-left:0in; margin-right:0in'>
	<font size="2">33,889</font></p>
  </td>
 </tr>
 <tr>
  <td width=132 valign=top style='width:98.8pt;padding:2.9pt 4.3pt 0in 4.3pt'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman"; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">Mark P. Murphy(3)</font></p>
  </td>
  <td width=72 valign=top style='width:.75in;padding:2.9pt 4.3pt 0in 4.3pt'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">3,750</font></p>
  </td>
  <td width=64 valign=top style='width:48.05pt;padding:2.9pt 4.3pt 0in 4.3pt'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">-</font></p>
  </td>
  <td width=63 valign=top style='width:47.4pt;padding:2.9pt 4.3pt 0in 4.3pt'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">3,750</font></p>
  </td>
 </tr>
 <tr>
  <td width=132 valign=top style='width:98.8pt;padding:2.9pt 4.3pt 0in 4.3pt'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman"; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">Michael Mesenbrink(4)</font></p>
  </td>
  <td width=72 valign=top style='width:.75in;padding:2.9pt 4.3pt 0in 4.3pt'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">18,500</font></p>
  </td>
  <td width=64 valign=top style='width:48.05pt;padding:2.9pt 4.3pt 0in 4.3pt'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">13,355</font></p>
  </td>
  <td width=63 valign=top style='width:47.4pt;padding:2.9pt 4.3pt 0in 4.3pt'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">31,855</font></p>
  </td>
 </tr>
 <tr>
  <td width=132 valign=top style='width:98.8pt;padding:2.9pt 4.3pt 0in 4.3pt'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman"; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">Valerio Giannini(5)</font></p>
  </td>
  <td width=72 valign=top style='width:.75in;padding:2.9pt 4.3pt 0in 4.3pt'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">18,500</font></p>
  </td>
  <td width=64 valign=top style='width:48.05pt;padding:2.9pt 4.3pt 0in 4.3pt'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">10,795</font></p>
  </td>
  <td width=63 valign=top style='width:47.4pt;padding:2.9pt 4.3pt 0in 4.3pt'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'>
	<font size="2">29,295</font></p>
  </td>
 </tr>
</table>

</div>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-left:31.5pt;text-indent:2.5pt; margin-right:0in; margin-top:0in'>___________________</p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-indent:.5in;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";margin-left:27.0pt;text-indent:-27.0pt'>
<font size="2">(1)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; This
column represents the dollar amount recognized for financial statement
reporting purposes with respect to the year ended June 30, 2007 for the fair
value of stock options granted to each of our directors calculated in
accordance with SFAS 123R.&nbsp; Pursuant to SEC rules, the amounts shown exclude
the impact of estimated forfeitures related to service-based vesting
conditions.&nbsp; For additional information on the valuation assumptions with
respect to these option grants, refer to Notes 1 and 6 of our financial
statements.&nbsp; These amounts reflect only our accounting expense for these option
grants and do not correspond to the actual value that will be recognized by our
directors.&nbsp; During the fiscal year ended June 30, 2007, the Company&#146;s
non-employee Directors, Messrs. Isaac, Mesenbrink, and Giannini, were each
granted options to purchase 15,000 shares of Common Stock, exercisable at share
prices of $1.74, $1.52 and $1.29 per share, respectively. </font></p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-indent:.5in;text-autospace:none;font-family:"Times New Roman";text-indent:0in'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-left:27.35pt;text-indent:-27.35pt; margin-right:0in; margin-top:0in'>
<font size="2">(2)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; At June 30, 2007, Mr. Isaac held options to
purchase an aggregate of 60,000 shares of Common Stock at a weighted average exercise
price of $2.08 per share, of which 60,000 options were vested.</font></p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-left:27.35pt;text-indent:-27.35pt; margin-right:0in; margin-top:0in'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-left:27.35pt;text-indent:-27.35pt; margin-right:0in; margin-top:0in'>
<font size="2">(3)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; At June 30, 2007, Mr. Murphy held options to
purchase an aggregate of 30,000 shares of Common Stock at a weighted average
exercise price of $2.96 per share, of which 30,000 options were vested.</font></p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-left:27.35pt;text-indent:-27.35pt; margin-right:0in; margin-top:0in'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-left:27.35pt;text-indent:-27.35pt; margin-right:0in; margin-top:0in'>
<font size="2">(4)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; At June 30, 2007, Mr. Mesenbrink held
options to purchase an aggregate of 80,000 shares of Common Stock at a weighted
average exercise price of $1.78 per share, of which 80,000 options were vested.</font></p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-left:24.5pt;text-indent:-24.5pt; margin-right:0in; margin-top:0in'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";margin-left:27.0pt;text-indent:-27.0pt'>
<font size="2">(5)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; At June 30, 2007, Mr. Giannini held options to
purchase an aggregate of 60,000 shares of Common Stock at a weighted average
exercise price of $2.18 per share, of which 60,000 options were vested.</font></p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman"; margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'>
<b>EQUITY
COMPENSATION PLAN INFORMATION</b></p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:center'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>
<font size="3">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; The following table sets forth information about
the Company&#146;s Common Stock that may be
issued upon the exercise of options under all of the Company&#146;s equity
compensation plans as of June 30, 2007.</font></p>
<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>
<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'>Page 14</p>

<div style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:center'>

<hr size=2 width="100%" noshade color=navy align=center>

</div>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<font face="Times New Roman">

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


</font>


<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:left'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<div align="center">

<table class=MsoNormalTable border=0 cellpadding=0 width=662
 style='width:100%;border-collapse:collapse' id="table4">
 <tr style='height:12.25pt'>
  <td width=15 valign=bottom style='border-left:1px solid #000000; border-top:1px solid #000000; width:11.1pt;height:12.25pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td width=182 valign=bottom style='border-top:1px solid #000000; width:136.2pt;height:12.25pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td width=150 valign=bottom style='border-top:1px solid #000000; width:112.45pt;height:12.25pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td width=10 valign=bottom style='border-top:1px solid #000000; width:7.15pt;height:12.25pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td width=139 valign=bottom style='border-top:1px solid #000000; width:104.55pt;height:12.25pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td width=166 valign=bottom style='border-right:1px solid #000000; border-top:1px solid #000000; width:124.35pt;height:12.25pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:center'><b>Number of Securities</b></p>
  </td>
 </tr>
 <tr style='height:12.25pt'>
  <td width=15 valign=bottom style='border-left:1px solid #000000; width:11.1pt;height:12.25pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td width=182 valign=bottom style='width:136.2pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td width=150 valign=bottom style='width:112.45pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:right'><b>Number of Securities</b></p>
  </td>
  <td width=10 valign=bottom style='width:7.15pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td width=139 valign=bottom style='width:104.55pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td width=166 valign=bottom style='border-right:1px solid #000000; width:124.35pt;height:12.25pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:center'><b>Available for Issuance</b></p>
  </td>
 </tr>
 <tr style='height:12.25pt'>
  <td width=15 valign=bottom style='border-left:1px solid #000000; width:11.1pt;height:12.25pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td width=182 valign=bottom style='width:136.2pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td width=150 valign=bottom style='width:112.45pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:center'><b>to be Issued Upon</b></p>
  </td>
  <td width=149 colspan=2 valign=bottom style='width:111.7pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:center'><b>Weighted Average</b></p>
  </td>
  <td width=166 valign=bottom style='border-right:1px solid #000000; width:124.35pt;height:12.25pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:center'><b>Under Equity</b></p>
  </td>
 </tr>
 <tr style='height:12.25pt'>
  <td width=15 valign=bottom style='border-left:1px solid #000000; width:11.1pt;height:12.25pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td width=182 valign=bottom style='width:136.2pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td width=150 valign=bottom style='width:112.45pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:center'><b>Exercise of</b></p>
  </td>
  <td width=149 colspan=2 valign=bottom style='width:111.7pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:center'><b>Exercise Price of</b></p>
  </td>
  <td width=166 valign=bottom style='border-right:1px solid #000000; width:124.35pt;height:12.25pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:center'><b>Compensation Plans</b></p>
  </td>
 </tr>
 <tr style='height:12.25pt'>
  <td width=15 valign=bottom style='border-left:1px solid #000000; width:11.1pt;height:12.25pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td width=182 valign=bottom style='width:136.2pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td width=150 valign=bottom style='width:112.45pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:right'><b>Outstanding Options,</b></p>
  </td>
  <td width=149 colspan=2 valign=bottom style='width:111.7pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:left'><b>Outstanding Options,</b></p>
  </td>
  <td width=166 valign=bottom style='border-right:1px solid #000000; width:124.35pt;height:12.25pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:center'><b>(excluding services</b></p>
  </td>
 </tr>
 <tr style='height:12.25pt'>
  <td width=15 valign=bottom style='border-left:1px solid #000000; border-right:medium none; border-top:medium none; width:11.1pt;border-bottom:
  1.0pt solid windowtext;height:12.25pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td width=182 valign=bottom style='width:136.2pt;border:none;border-bottom:
  solid windowtext 1.0pt;padding:0in 1.45pt 0in 1.45pt;height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:left'><b>Plan Category</b></p>
  </td>
  <td width=150 valign=bottom style='width:112.45pt;border:none;border-bottom:
  solid windowtext 1.0pt;padding:0in 1.45pt 0in 1.45pt;height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:center'><b>Warrants and Rights</b></p>
  </td>
  <td width=149 colspan=2 valign=bottom style='width:111.7pt;border:none;
  border-bottom:solid windowtext 1.0pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:left'><b>Warrants, and Rights</b></p>
  </td>
  <td width=166 valign=bottom style='border-left:medium none; border-right:1px solid #000000; border-top:medium none; width:124.35pt;border-bottom:
  1.0pt solid windowtext;height:12.25pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:center'><b>reflected in column (a))</b></p>
  </td>
 </tr>
 <tr style='height:12.25pt'>
  <td width=15 valign=bottom style='border-left:1px solid #000000; border-right:medium none; border-top:medium none; width:11.1pt;border-bottom:
  1.0pt solid windowtext;height:12.25pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td width=182 valign=bottom style='width:136.2pt;border:none;border-bottom:
  solid windowtext 1.0pt;padding:0in 1.45pt 0in 1.45pt;height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td width=150 valign=bottom style='width:112.45pt;border:none;border-bottom:
  solid windowtext 1.0pt;padding:0in 1.45pt 0in 1.45pt;height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:center'>(a)</p>
  </td>
  <td width=149 colspan=2 valign=bottom style='width:111.7pt;border:none;
  border-bottom:solid windowtext 1.0pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:center'>(b)</p>
  </td>
  <td width=166 valign=bottom style='border-left:medium none; border-right:1px solid #000000; border-top:medium none; width:124.35pt;border-bottom:
  1.0pt solid windowtext;height:12.25pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:center'>(c)</p>
  </td>
 </tr>
 <tr style='height:12.25pt'>
  <td width=196 colspan=2 valign=bottom style='border-left:1px solid #000000; width:147.3pt;height:12.25pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:left'>Plans Approved by</p>
  </td>
  <td width=150 valign=bottom style='width:112.45pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td width=10 valign=bottom style='width:7.15pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td width=139 valign=bottom style='width:104.55pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td width=166 valign=bottom style='border-right:1px solid #000000; width:124.35pt;height:12.25pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
 </tr>
 <tr style='height:12.25pt'>
  <td width=196 colspan=2 valign=bottom style='border-left:1px solid #000000; width:147.3pt;height:12.25pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:left'>Stockholders:</p>
  </td>
  <td width=150 valign=bottom style='width:112.45pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td width=10 valign=bottom style='width:7.15pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td width=139 valign=bottom style='width:104.55pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td width=166 valign=bottom style='border-right:1px solid #000000; width:124.35pt;height:12.25pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
 </tr>
 <tr style='height:12.25pt'>
  <td width=15 valign=bottom style='border-left:1px solid #000000; width:11.1pt;height:12.25pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td width=182 valign=bottom style='width:136.2pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:left'>1994 Employee Option Plan</p>
  </td>
  <td width=150 valign=bottom style='width:112.45pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:right'>585,000&nbsp;</p>
  </td>
  <td width=10 valign=bottom style='width:7.15pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:right'>&nbsp;</p>
  </td>
  <td width=139 valign=bottom style='width:104.55pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:right'>$1.27&nbsp;</p>
  </td>
  <td width=166 valign=bottom style='border-right:1px solid #000000; width:124.35pt;height:12.25pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:right'>-&nbsp;</p>
  </td>
 </tr>
 <tr style='height:12.25pt'>
  <td width=15 valign=bottom style='border-left:1px solid #000000; width:11.1pt;height:12.25pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td width=182 valign=bottom style='width:136.2pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:left'>2004 Employee Option Plan</p>
  </td>
  <td width=150 valign=bottom style='width:112.45pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:right'>478,500&nbsp;</p>
  </td>
  <td width=10 valign=bottom style='width:7.15pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:right'>&nbsp;</p>
  </td>
  <td width=139 valign=bottom style='width:104.55pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:right'>$1.64&nbsp;</p>
  </td>
  <td width=166 valign=bottom style='border-right:1px solid #000000; width:124.35pt;height:12.25pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:right'>352,045&nbsp;</p>
  </td>
 </tr>
 <tr style='height:12.25pt'>
  <td width=15 valign=bottom style='border-left:1px solid #000000; width:11.1pt;height:12.25pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td width=182 valign=bottom style='width:136.2pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:left'>1994 Director Option Plan</p>
  </td>
  <td width=150 valign=bottom style='width:112.45pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:right'>65,000&nbsp;</p>
  </td>
  <td width=10 valign=bottom style='width:7.15pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:right'>&nbsp;</p>
  </td>
  <td width=139 valign=bottom style='width:104.55pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:right'>$1.40&nbsp;</p>
  </td>
  <td width=166 valign=bottom style='border-right:1px solid #000000; width:124.35pt;height:12.25pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:right'>-&nbsp;</p>
  </td>
 </tr>
 <tr style='height:12.25pt'>
  <td width=15 valign=bottom style='border-left:1px solid #000000; border-right:medium none; border-top:medium none; width:11.1pt;border-bottom:
  1.0pt solid windowtext;height:12.25pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td width=182 valign=bottom style='width:136.2pt;border:none;border-bottom:
  solid windowtext 1.0pt;padding:0in 1.45pt 0in 1.45pt;height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:left'>2004 Director Option Plan</p>
  </td>
  <td width=150 valign=bottom style='width:112.45pt;border:none;border-bottom:
  solid windowtext 1.0pt;padding:0in 1.45pt 0in 1.45pt;height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:right'>165,000&nbsp;</p>
  </td>
  <td width=10 valign=bottom style='width:7.15pt;border:none;border-bottom:
  solid windowtext 1.0pt;padding:0in 1.45pt 0in 1.45pt;height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:right'>&nbsp;</p>
  </td>
  <td width=139 valign=bottom style='width:104.55pt;border:none;border-bottom:
  solid windowtext 1.0pt;padding:0in 1.45pt 0in 1.45pt;height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:right'>$2.40&nbsp;</p>
  </td>
  <td width=166 valign=bottom style='border-left:medium none; border-right:1px solid #000000; border-top:medium none; width:124.35pt;border-bottom:
  1.0pt solid windowtext;height:12.25pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:right'>195,000&nbsp;</p>
  </td>
 </tr>
 <tr style='height:12.25pt'>
  <td width=196 colspan=2 valign=bottom style='border-left:1px solid #000000; width:147.3pt;height:12.25pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:left'>Plans Not Approved by</p>
  </td>
  <td width=150 valign=bottom style='width:112.45pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td width=10 valign=bottom style='width:7.15pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td width=139 valign=bottom style='width:104.55pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td width=166 valign=bottom style='border-right:1px solid #000000; width:124.35pt;height:12.25pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
 </tr>
 <tr style='height:12.25pt'>
  <td width=196 colspan=2 valign=bottom style='border-left:1px solid #000000; width:147.3pt;height:12.25pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:left'>Stockholders</p>
  </td>
  <td width=150 valign=bottom style='width:112.45pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td width=10 valign=bottom style='width:7.15pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td width=139 valign=bottom style='width:104.55pt;padding:0in 1.45pt 0in 1.45pt;
  height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td width=166 valign=bottom style='border-right:1px solid #000000; width:124.35pt;height:12.25pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
 </tr>
 <tr style='height:12.25pt'>
  <td width=15 valign=bottom style='border-left:1px solid #000000; border-right:medium none; border-top:medium none; width:11.1pt;border-bottom:
  1.0pt solid windowtext;height:12.25pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td width=182 valign=bottom style='width:136.2pt;border:none;border-bottom:
  solid windowtext 1.0pt;padding:0in 1.45pt 0in 1.45pt;height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:left'>Warrants (1)</p>
  </td>
  <td width=150 valign=bottom style='width:112.45pt;border:none;border-bottom:
  solid windowtext 1.0pt;padding:0in 1.45pt 0in 1.45pt;height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:right'>100,000&nbsp;</p>
  </td>
  <td width=10 valign=bottom style='width:7.15pt;border:none;border-bottom:
  solid windowtext 1.0pt;padding:0in 1.45pt 0in 1.45pt;height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:right'>&nbsp;</p>
  </td>
  <td width=139 valign=bottom style='width:104.55pt;border:none;border-bottom:
  solid windowtext 1.0pt;padding:0in 1.45pt 0in 1.45pt;height:12.25pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:right'>$1.25&nbsp;</p>
  </td>
  <td width=166 valign=bottom style='border-left:medium none; border-right:1px solid #000000; border-top:medium none; width:124.35pt;border-bottom:
  1.0pt solid windowtext;height:12.25pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:right'>-&nbsp;</p>
  </td>
 </tr>
 <tr style='height:24.5pt'>
  <td width=15 valign=bottom style='border-left:1px solid #000000; border-right:medium none; border-top:medium none; width:11.1pt;border-bottom:
  1.0pt solid windowtext;height:24.5pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td width=182 valign=bottom style='width:136.2pt;border:none;border-bottom:
  solid windowtext 1.0pt;padding:0in 1.45pt 0in 1.45pt;height:24.5pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:left'>Total</p>
  </td>
  <td width=150 valign=bottom style='width:112.45pt;border:none;border-bottom:
  solid windowtext 1.0pt;padding:0in 1.45pt 0in 1.45pt;height:24.5pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:right'>1,138,500&nbsp;</p>
  </td>
  <td width=10 valign=bottom style='width:7.15pt;border:none;border-bottom:
  solid windowtext 1.0pt;padding:0in 1.45pt 0in 1.45pt;height:24.5pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:right'>&nbsp;</p>
  </td>
  <td width=139 valign=bottom style='width:104.55pt;border:none;border-bottom:
  solid windowtext 1.0pt;padding:0in 1.45pt 0in 1.45pt;height:24.5pt'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:right'>$1.65&nbsp;</p>
  </td>
  <td width=166 valign=bottom style='border-left:medium none; border-right:1px solid #000000; border-top:medium none; width:124.35pt;border-bottom:
  1.0pt solid windowtext;height:24.5pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:right'>547,045&nbsp;</p>
  </td>
 </tr>
</table>

</div>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-left:.5in;text-indent:-.5in;text-autospace:
ideograph-numeric ideograph-other; margin-right:0in; margin-top:0in'>
<font size="2">&nbsp;</font></p>
<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-left:.5in;text-indent:-.5in;text-autospace:
ideograph-numeric ideograph-other; margin-right:0in; margin-top:0in'>
<font size="2">(1)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; At
June 30, 2007, warrants to acquire 100,000 shares of Common Stock were outstanding.
These warrants are fully vested, have a weighted-average exercise price of
$1.25 and a weighted-average remaining life of 2.0 years.</font></p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-indent:.5in;text-autospace:none;font-family:"Times New Roman"'><a name="_DV_C233">Options and Warrants Generally</a></p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-indent:.5in;text-autospace:none;font-family:"Times New Roman"'>For
options and warrants other than those discussed above, the Board of Directors,
as the administrator of the Company&#146;s 1994 and 2004 Employee Stock Option Plans
and the 1994 and 2004 Director Stock Option Plans, has the discretion to
accelerate any outstanding options held by the employees and directors in the
event of an acquisition of the Company by a merger or asset sale in which the
outstanding options under each such plan are not to be assumed by the successor
corporation or substituted with options to purchase shares of such corporation.</p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-indent:.5in;text-autospace:none;font-family:"Times New Roman";text-align:left;text-indent:0in;page-break-after:
avoid'><b>Compensation Philosophy</b> </p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-indent:.5in;text-autospace:none;font-family:"Times New Roman"'>The Company applies a consistent
philosophy to compensation for all employees, including senior management. This
philosophy is based on the premise that the achievements of the Company result
from the coordinated efforts of all individuals working toward common
objectives. The Company strives to achieve those objectives through teamwork
that is focused on meeting the expectations of customers and shareholders.&nbsp; The
Compensation Committee has the authority to set all executive officer
compensation.&nbsp; This authority historically has not been delegated to others,
except the Board of Directors has also made such determinations.&nbsp; The
Compensation Committee receives input from the Chief Executive Officer
concerning his recommendations for executive compensation.&nbsp; The final deliberations
and vote are made outside the presence of the Chief Executive Officer.&nbsp; To
date, the Company has not engaged compensation consultants or persons
performing similar functions.</p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-indent:.5in;text-autospace:none;font-family:"Times New Roman"'>The goals of the compensation program are
to align compensation with business objectives and performance, and to enable
the Company to attract, retain and reward executive officers that contribute to
the long-term success of the Company. The Company&#146;s compensation program for
executive officers is based on the same four principles applicable to
compensation decisions for all employees of the Company:</p>

<ul>
	<li>
	<p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:0.25in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:12.0pt'>The Company pays competitively. The Company is committed to
providing a pay program that helps attract and retain highly qualified people
in the industry.&nbsp; To ensure that pay is competitive, the Company compares its
pay practices with those of other leading companies of similar size and sets
its pay parameters based on this review.</p></li>
</ul>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'><a name="_DV_M159"></a>Page
15</p>

<div style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:center'>&nbsp;<hr size=2 width="100%" noshade color=navy align=center>

</div>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";line-height:1.0pt; margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp;</p>

<font face="Times New Roman">

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


</font>

<ul>
	<li>
	<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:12.0pt;margin-right:0in;margin-bottom:
0in;margin-left:0.25in;margin-bottom:.0001pt;'>The Company pays for sustained performance. Executive officers
are rewarded based upon corporate performance and individual performance.
Corporate performance is evaluated by the Board of Directors by reviewing the
extent to which strategic and business plan goals are met, including such
factors as revenues, operating profit and cash flow. </p></li>
	<li>
	<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:12.0pt;margin-right:0in;margin-bottom:
0in;margin-left:0.25in;margin-bottom:.0001pt;'>The Company strives for fairness in the administration of pay and
to achieve a balance of the compensation paid to a particular individual with
the compensation paid to other executives both inside the Company and at
comparable companies.</p></li>
	<li>
	<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:12.0pt;margin-right:0in;margin-bottom:
0in;margin-left:0.25in;margin-bottom:.0001pt;'>The Company believes that employees should understand the
performance evaluation and pay administration process. </p></li>
</ul>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:12.0pt;page-break-after:avoid; margin-left:0in; margin-right:0in'><a
name="_DV_M168"></a><b>Compensation Vehicles</b></p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-indent:.5in;text-autospace:none;font-family:"Times New Roman"'><a name="_DV_M169"></a>The Company has historically used a
compensation program that consists of cash and equity based compensation. The
vehicles are:</p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:.5in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman"'><a name="_DV_M170"></a><u>Salary</u>.  The Company sets base
salary for its employees by reviewing the base salary for competitive positions
in the market in order to attract, retain, and motivate highly talented
individuals at all levels in the organization. </p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:.5in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman"'><a name="_DV_M171"></a><u>Bonus</u>.&nbsp; The Company utilizes
incentive compensation plans for all employees to reward achievement of key
objectives and goals.</p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:.5in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman"'><a name="_DV_M172"></a><u>Employee Stock Option Program</u>.
The purpose of this program is to provide additional incentives to selected
employees to work to maximize shareholder value.&nbsp; The Compensation Committee of
the Board of Directors makes all stock option grants.&nbsp; Stock options generally
are granted with an exercise price equal to the fair market value of the
underlying Common Stock on the date of grant and vest in equal annual
installments over a four-year period. </p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:.5in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman"'><u>Stock Appreciation Rights</u>. The purpose of this program
is to provide additional incentives to the Chief Executive Officer to work to
maximize shareholder value.&nbsp; The Compensation Committee of the Board of
Directors makes all grants of Stock Appreciation Rights.&nbsp; Stock Appreciation
Rights generally are granted with a base price equal to the fair market value
of the underlying Common Stock on the date of grant and vest in equal annual
installments over a three-year period. </p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:.5in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman"'><u>Restricted Stock</u>.&nbsp; The Company utilizes restricted stock
grants to provide an incentive vehicle to key management personnel.&nbsp; The
Compensation Committee of the Board of Directors makes all grants of restricted
stock under the terms of one of the Company&#146;s existing equity plans previously
approved by the Company&#146;s shareholders.&nbsp; Restricted stock grants generally vest
over a period of years as determined by the Compensation Committee.</p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:.5in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-indent:.5in;text-autospace:none;font-family:"Times New Roman";text-align:center;text-indent:0in;page-break-after:
avoid'><b>AUDIT
COMMITTEE REPORT</b></p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-indent:.5in;text-autospace:none;font-family:"Times New Roman"'><a name="_DV_M176"></a>The Audit Committee reports to and acts on
behalf of the Board of Directors in providing oversight to the financial
management, independent auditors, and financial reporting procedures of the
Company.&nbsp; The Company&#146;s management is responsible for preparing the Company&#146;s
financial statements and the independent auditors are responsible for auditing
those statements.&nbsp; In this context, the Audit Committee has reviewed and
discussed the audited financial statements contained in the 2007 Annual Report
on Form 10-KSB with management and the independent auditors.</p>
<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-indent:.5in;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>
<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-indent:.5in;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'><a name="_DV_M177"></a>Page
16</p>

<div style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:center'>

<hr size=2 width="100%" noshade color=navy align=center>

</div>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<font face="Times New Roman">

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


</font>


<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:left'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-indent:.5in;text-autospace:none;font-family:"Times New Roman"'>The Audit Committee has discussed with the independent auditors
the matters required to be discussed by the Statement on Auditing Standards No.
61 (&#147;Communication with Audit Committees&#148;), as amended.&nbsp; The Audit Committee
has received the written disclosures and the letter from the independent
auditors required by Independence Standards Board Standard No. 1 (Independence
Discussions with Audit Committees), as amended, and has discussed with the
independent auditors their independence.&nbsp; In concluding that the auditors are
independent, the Audit Committee considered, among other factors, whether the
non-audit services provided by Moss Adams, LLP were compatible with maintaining
their independence.&nbsp; </p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-indent:.5in;text-autospace:none;font-family:"Times New Roman"'><a name="_DV_M178"></a>In reliance on the reviews and discussions
referred to above, the Audit Committee recommended to the Board of Directors
that the audited financial statements be included in the Company&#146;s Annual
Report on Form 10-KSB for the fiscal year ended June 30, 2007, for filing with
the Securities and Exchange Commission.&nbsp; </p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-indent:.5in;text-autospace:none;font-family:"Times New Roman";page-break-after:avoid'><a name="_DV_M179"></a>The Audit
Committee has retained Moss Adams, LLP to serve as the Company&#146;s independent
auditors for the fiscal year ending June 30, 2008.</p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-indent:.5in;text-autospace:none;font-family:"Times New Roman";text-align:center;text-indent:0in;page-break-after:
avoid'><b>AUDIT COMMITTEE</b></p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-indent:.5in;text-autospace:none;font-family:"Times New Roman";text-align:center;text-indent:0in'>Valerio L. Giannini &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Michael A. Mesenbrink&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; George Isaac</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";margin-top:12.0pt'>&nbsp;</p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;page-break-after:avoid;text-autospace:none;font-family:"Times New Roman";font-weight:bold'>CODE OF BUSINESS CONDUCT AND ETHICS</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:12.0pt;text-indent:.5in; margin-left:0in; margin-right:0in'>Our code of business
conduct and ethics, as approved by our board of directors, can be obtained from
our Internet site at http://www.pro-dex.com/code_of_ethics.php.</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:12.0pt;text-indent:.5in; margin-left:0in; margin-right:0in'>We intend to
satisfy the disclosure requirement under Item 5.05 of Form 8-K relating to
amendments to or waivers from provisions of the code that relate to one of more
of the items set forth in Item 406(b) of Regulation S-B, by describing on our
Internet site, within four business days following the date of a waiver or a
substantive amendment, the date of the waiver or amendment, the nature of the
amendment or waiver, and the name of the person to whom the waiver was granted.</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:12.0pt;text-indent:.5in; margin-left:0in; margin-right:0in'>Information on
our Internet site is not, and shall not be deemed to be, a part of this proxy
statement or incorporated into any other filings we make with the Securities
and Exchange Commission. </p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;page-break-after:avoid;text-autospace:none;font-family:"Times New Roman";font-weight:bold'>SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:12.0pt;text-indent:.5in; margin-left:0in; margin-right:0in'><a name="_DV_M188"></a>Under
Section 16(a) of the Securities Exchange Act of 1934, as amended, the directors
and officers of the Company and any person who owns more than ten percent of
the Company&#146;s Common Stock are required to report their initial ownership of
the Company&#146;s Common Stock and any subsequent changes in that ownership to the
Securities and Exchange Commission (&#147;SEC&#148;) and the Nasdaq Capital Market. Officers,
directors and greater than 10% shareholders are required by SEC regulations to
furnish the Company with copies of all forms they file in accordance with
Section 16(a).&nbsp; Based solely on its review of the copies of such forms received
by it, or written representations from certain reporting persons that no other
reports were required for those persons, the Company believes that, during the
fiscal year ended June 30, 2007, its officers, directors and greater than 10%
shareholders complied with all filing requirements applicable to such persons.</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";margin-top:12.0pt;text-indent:.5in'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'><b>COMMUNICATIONS
WITH DIRECTORS</b></p>
<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:center'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman"; margin-left:0in; margin-right:0in; margin-top:0in'><b>&nbsp;</b>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Board
has established a process to receive communications from shareholders.
Shareholders and other interested parties may contact any member (or all
members) of the Board, or the independent directors as a group, any Board
committee or any Chair of any such committee by mail or electronically. To
communicate with the Board of Directors, any individual directors or any group
or committee of directors, correspondence should be addressed to the Board of
Directors or any such individual directors or group or committee of directors
by either name or title. All such correspondence should be sent &quot;c/o
Corporate Secretary&quot; at 151 E. Columbine Avenue, Santa Ana, California
92707.&nbsp; To communicate with any of our directors electronically, a shareholder
should send an email to the Company&#146;s Secretary: jeff.ritchey@pro-dex.com. </p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'>Page 17</p>

<div style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:center'>

<hr size=2 width="100%" noshade color=navy align=center>

</div>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<font face="Times New Roman">

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


</font>


<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman"; margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;All
communications received as set forth in the preceding paragraph will be opened
by the Company&#146;s Secretary for the sole purpose of determining whether the
contents represent a message to one or more of the directors.&nbsp; Any contents
that are not in the nature of advertising, promotions of a product or service,
patently offensive material or matters deemed inappropriate for the Board of
Directors will be forwarded promptly to the addressee. In the case of
communications to the Board or any group or committee of directors, the
Company&#146;s Secretary will make sufficient copies (or forward such information in
the case of e-mail) of the contents to send to each director who is a member of
the group or committee to which the envelope or e-mail is addressed. </p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-indent:.5in; margin-left:0in; margin-right:0in; margin-top:0in'>It is the Company's policy that its
directors are invited and encouraged to attend all of the Company&#146;s annual
meetings of shareholders.&nbsp; All of the directors were in attendance at the 2006
Annual Meeting.</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:12.0pt;text-align:center;
page-break-after:avoid; margin-left:0in; margin-right:0in'>Proposal No. 3</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:12.0pt;text-align:center;
page-break-after:avoid; margin-left:0in; margin-right:0in'><b>RATIFICATION OF APPOINTMENT OF INDEPENDENT PUBLIC
ACCOUNTANTS</b></p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:12.0pt;text-indent:.5in; margin-left:0in; margin-right:0in'>The Audit Committee of the Company has appointed the firm
of Moss Adams, LLP as the Company&#146;s independent certified public accountants
for the fiscal year ending June 30, 2008, and requests the shareholders to
ratify this appointment.&nbsp; In the event that the shareholders do not ratify the
selection of Moss Adams, LLP as the Company&#146;s independent public accountants,
the Board of Directors will consider the selection of another independent
public accounting firm. </p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-indent:.5in; margin-left:0in; margin-right:0in; margin-top:0in'>A
representative of Moss Adams, LLP is expected to be present at the Annual
Meeting, will have the opportunity to make a statement if such representative
desires to do so, and will be available to respond to appropriate questions. </p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-indent:.5in;text-autospace:none;font-family:"Times New Roman";text-align:center;text-indent:0in;page-break-after:
avoid'><b>ACCOUNTING FEES</b></p>

<pre style='margin-bottom:.0001pt;text-autospace:none;font-size:10.0pt;font-family:"Times New Roman";margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp;</pre>
<p
style='text-align:justify'><font face="Times New Roman"> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; The Audit Committee's policy is to pre-approve all auditing services and permitted non-audit services (including the fees and terms thereof) to be performed for the Company by its independent auditor, subject to the de minimis exceptions for non-audit services described in Section 10A(i)(1)(B) of the Exchange Act which are approved by the Audit Committee prior to the completion of the audit.&nbsp; The Audit Committee considers whether the performance of any service by the Company&#146;s independent auditors is compatible with maintaining such auditor&#146;s independence.</font></p>

<p style='margin-right:0in;margin-left:0in;font-size:12.0pt;font-family:"Arial Unicode MS";margin:0in;margin-bottom:.0001pt;text-indent:24.5pt'>&nbsp;</p>

<p style='margin-right:0in;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";margin-bottom:.0001pt;text-align:justify;text-indent:24.5pt; margin-left:0in; margin-right:0in; margin-top:0in'>The following table sets
forth the aggregate fees billed to the Company for the fiscal years ended June
30, 2007 and June 30, 2006 by the Company&#146;s auditors, all of which were
preapproved by the Audit Committee:</p>
<p style='margin-right:0in;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";margin-bottom:.0001pt;text-align:justify;text-indent:24.5pt; margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp;</p>

<div align="center">

<table class=MsoNormalTable border=0 cellpadding=0 width=459
 style='width:75%;border-collapse:collapse' id="table5">
 <tr style='height:11.5pt'>
  <td width="44%" valign=bottom style='border-left:1px solid #000000; border-top:1px solid #000000; height:11.5pt; border-bottom-style:none; border-bottom-width:medium; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:center'>&nbsp;</p>
  </td>
  <td colspan=2 valign=bottom style='border-top:1px solid #000000; height:11.5pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'>
	<u><b>Fiscal 2007</b></u></p>
  </td>
  <td colspan=3 valign=bottom style='border-right:1px solid #000000; border-top:1px solid #000000; height:11.5pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'>
	<u><b>Fiscal 2006</b></u></p>
  </td>
 </tr>
 <tr style='height:12.25pt'>
  <td width="44%" valign=bottom style='border-left:1px solid #000000; border-top:medium none #000000; height:12.25pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:left'>Audit Fees&#185;</p>
  </td>
  <td width="2%" valign=bottom style='border-top:medium none #000000; height:12.25pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:right'>&nbsp;</p>
  </td>
  <td width="23%" valign=bottom style='border-top:medium none #000000; height:12.25pt; border-right-style:none; border-right-width:medium; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in' align="right">
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:right'>$131,000&nbsp;</p>
  </td>
  <td width="4%" valign=bottom style='border-right:medium none #000000; border-top:medium none #000000; height:12.25pt; border-left-style:none; border-left-width:medium; border-bottom-style:none; border-bottom-width:medium; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in' align="right">
  &nbsp;</td>
  <td width="1%" valign=bottom style='border-right:medium none #000000; border-top:medium none #000000; height:12.25pt; border-left-style:none; border-left-width:medium; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in' align="right">
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:right'>&nbsp;</p>
  </td>
  <td width="23%" valign=bottom style='border-right:1px solid #000000; border-top:medium none #000000; height:12.25pt; border-left-style:none; border-left-width:medium; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in' align="right">
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:right'>$126,406&nbsp;</p>
  </td>
 </tr>
 <tr style='height:12.25pt'>
  <td width="44%" valign=bottom style='border-left:1px solid #000000; height:12.25pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:left'>
	Audit-Related Fees&#178;</p>
  </td>
  <td width="2%" valign=bottom style='height:12.25pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:right'>&nbsp;</p>
  </td>
  <td width="23%" valign=bottom style='height:12.25pt; border-right-style:none; border-right-width:medium; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in' align="right">
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:right'>$2,725&nbsp;</p>
  </td>
  <td width="4%" valign=bottom style='border-right:medium none #000000; height:12.25pt; border-left-style:none; border-left-width:medium; border-top-style:none; border-top-width:medium; border-bottom-style:none; border-bottom-width:medium; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in' align="right">
  &nbsp;</td>
  <td width="1%" valign=bottom style='border-right:medium none #000000; height:12.25pt; border-left-style:none; border-left-width:medium; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in' align="right">
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:right'>&nbsp;</p>
  </td>
  <td width="23%" valign=bottom style='border-right:1px solid #000000; height:12.25pt; border-left-style:none; border-left-width:medium; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in' align="right">
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:right'>$86,131&nbsp;</p>
  </td>
 </tr>
 <tr style='height:12.25pt'>
  <td width="44%" valign=bottom style='border-left:1px solid #000000; height:12.25pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:left'>Tax Fees&#179;</p>
  </td>
  <td width="2%" valign=bottom style='height:12.25pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:right'>&nbsp;</p>
  </td>
  <td width="23%" valign=bottom style='height:12.25pt; border-right-style:none; border-right-width:medium; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in' align="right">
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:right'>$30,570&nbsp;</p>
  </td>
  <td width="4%" valign=bottom style='border-right:medium none #000000; height:12.25pt; border-left-style:none; border-left-width:medium; border-top-style:none; border-top-width:medium; border-bottom-style:none; border-bottom-width:medium; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in' align="right">
  &nbsp;</td>
  <td width="1%" valign=bottom style='border-right:medium none #000000; height:12.25pt; border-left-style:none; border-left-width:medium; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in' align="right">
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:right'>&nbsp;</p>
  </td>
  <td width="23%" valign=bottom style='border-right:1px solid #000000; height:12.25pt; border-left-style:none; border-left-width:medium; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in' align="right">
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:right'>$31,951&nbsp;</p>
  </td>
 </tr>
 <tr style='height:11.5pt'>
  <td width="44%" valign=bottom style='border-left:1px solid #000000; height:11.5pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:left; margin-left:0in; margin-right:0in; margin-top:0in'>All Other Fees&nbsp;</p>
  </td>
  <td width="2%" valign=bottom style='border-bottom:1px solid #000000; height:11.5pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:right'>$</p>
  </td>
  <td width="23%" valign=bottom style='border-bottom:1px solid #000000; height:11.5pt; border-right-style:none; border-right-width:medium; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in' align="right">
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:right'>-&nbsp;</p>
  </td>
  <td width="4%" valign=bottom style='border-right:medium none #000000; border-bottom:medium none #000000; height:11.5pt; border-left-style:none; border-left-width:medium; border-top-style:none; border-top-width:medium; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in' align="right">
  &nbsp;</td>
  <td width="1%" valign=bottom style='border-right:medium none #000000; border-bottom:1px solid #000000; height:11.5pt; border-left-style:none; border-left-width:medium; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in' align="right">
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:right'>$</p>
  </td>
  <td width="23%" valign=bottom style='border-right:1px solid #000000; border-bottom:1px solid #000000; height:11.5pt; border-left-style:none; border-left-width:medium; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in' align="right">
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:right'>-&nbsp;</p>
  </td>
 </tr>
 <tr style='height:16.55pt'>
  <td width="44%" valign=bottom style='border-left:1px solid #000000; border-bottom:1px solid #000000; height:16.55pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:left'>Total</p>
  </td>
  <td width="2%" valign=bottom style='border-bottom:1px solid #000000; height:16.55pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in'>
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:right'>&nbsp;</p>
  </td>
  <td width="23%" valign=bottom style='border-bottom:1px solid #000000; height:16.55pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in' align="right">
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:right'>$164,295&nbsp;</p>
  </td>
  <td width="4%" valign=bottom style='border-right:medium none #000000; border-bottom:1px solid #000000; height:16.55pt; border-top-style:none; border-top-width:medium; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in' align="right">
  &nbsp;</td>
  <td width="1%" valign=bottom style='border-right:medium none #000000; border-bottom:1px solid #000000; height:16.55pt; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in' align="right">
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:right'>&nbsp;</p>
  </td>
  <td width="23%" valign=bottom style='border-right:1px solid #000000; border-bottom:1px solid #000000; height:16.55pt; border-left-style:none; border-left-width:medium; padding-left:1.45pt; padding-right:1.45pt; padding-top:0in; padding-bottom:0in' align="right">
  <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:right'>$244,488&nbsp;</p>
  </td>
 </tr>
</table>

</div>

<div style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:left'>

<hr size=1 width="18%" noshade color=black align=left>

</div>

<p style='margin-right:0in;margin-left:0in;font-family:"Times New Roman";margin-bottom:.0001pt;text-align:justify; margin-left:0in; margin-right:0in; margin-top:0in'>(1) <i>Audit Fees</i>
consist of fees billed for professional services rendered for the audit of the
Company&#146;s consolidated annual financial statements and review of the interim
consolidated financial statements included in quarterly reports and services
that are normally provided by Moss Adams LLP, in connection with statutory and
regulatory filings or engagements. </p>
<p style='margin-right:0in;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";margin-bottom:.0001pt;text-align:justify; margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'>Page 18</p>

<div style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:center'>

<hr size=2 width="100%" noshade color=navy align=center>

</div>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<font face="Times New Roman">

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


</font>


<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:left'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin-right:0in;margin-left:0in;font-family:"Times New Roman";margin-bottom:.0001pt; margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp;</p>

<p style='margin-right:0in;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";margin-bottom:.0001pt;text-align:justify; margin-left:0in; margin-right:0in; margin-top:0in'>(2) <i>Audit-Related
Fees</i> consist of fees billed for assurance and related services that are
reasonably related to the performance of the audit or review of the Company&#146;s
consolidated financial statements and are not reported under &#147;Audit Fees.&#148; This
category includes fees related to the filing of the S-8 registration statement
for the 2004 Restated Stock Option Plan; and consultation regarding accounting
or disclosure treatment of transactions or events and/or the actual or
potential impact of final or proposed rules, standards or interpretation by the
SEC, FASB or other regulatory or standard-setting bodies as well as general
assistance with implementation of the requirements of SEC rules or listing
standards promulgated pursuant to the Sarbanes&#150;Oxley Act of 2002. </p>

<p style='margin-right:0in;margin-left:0in;font-family:"Times New Roman";margin-bottom:.0001pt; margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp;</p>

<p style='margin-right:0in;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";margin-bottom:.0001pt;text-align:justify; margin-left:0in; margin-right:0in; margin-top:0in'>(3) <i>Tax Fees</i>
consist of fees billed for professional services rendered for tax compliance,
tax advice and tax planning. These services include assistance regarding
federal state and local tax compliance, planning and advice. </p>

<p style='margin-right:0in;margin-left:0in;font-family:"Times New Roman";margin-bottom:.0001pt; margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp;</p>

<p style='margin-right:0in;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";margin-bottom:.0001pt;text-align:justify; margin-left:0in; margin-right:0in; margin-top:0in'>(4) <i>All Other Fees</i>
consist of fees for products and services other than the services reported
above.</p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-indent:.5in;text-autospace:none;font-family:"Times New Roman";text-align:left;text-indent:0in;page-break-after:
avoid'><b>Required Vote and Board
Recommendation</b></p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-indent:.5in;text-autospace:none;font-family:"Times New Roman";page-break-after:avoid'>Although shareholder ratification is not required
for the appointment of Moss Adams, LLP as the Company&#146;s independent public
accountants for the fiscal year ending June
30, 2008, the Board of Directors has directed that this appointment be
submitted to the Company&#146;s shareholders for ratification at the Annual Meeting.&nbsp; Assuming
the holders of shares entitled to cast
a majority of the total votes of the outstanding
shares of stock entitled to vote on this proposal, represented in person or by
proxy, are present at the Annual Meeting, this proposal will be ratified and
approved if the votes cast in favor of this proposal exceed the votes cast
opposing this proposal.&nbsp; Abstentions and broker non-votes will be counted for
purposes of determining whether a quorum is present for this proposal, but will
not be included in the vote totals for this proposal and, therefore, will have no
effect on the vote.</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman"; margin-left:0in; margin-right:0in; margin-top:0in'><b>&nbsp;</b></p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-indent:.5in; margin-left:0in; margin-right:0in; margin-top:0in'><a name="_DV_M273"></a><b>THE BOARD
OF DIRECTORS RECOMMENDS THAT THE SHAREHOLDERS VOTE &#147;FOR&#148; THE RATIFICATION OF
THE APPOINTMENT OF MOSS ADAMS, LLP TO SERVE AS THE COMPANY&#146;S INDEPENDENT PUBLIC
ACCOUNTANTS FOR THE FISCAL YEAR ENDING JUNE&nbsp;30,&nbsp;2008.</b><a
name="_DV_M274"></a></p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-indent:.5in'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'><b>ANNUAL REPORT</b></p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-indent:.5in;text-autospace:none;font-family:"Times New Roman"'><a name="_DV_M275"></a>The Company&#146;s Annual Report containing
audited financial statements for the fiscal year ended June 30, 2007
accompanies this proxy statement.&nbsp; Such report is not incorporated herein and
is not deemed to be a part of this proxy solicitation material.</p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;page-break-after:avoid;text-autospace:none;font-family:"Times New Roman";font-weight:bold'>PROPOSALS OF SHAREHOLDERS</p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-indent:.5in;text-autospace:none;font-family:"Times New Roman"'>Pursuant to Rule 14a-8 of the Securities
and Exchange Commission, proposals by shareholders which are intended for
inclusion in the Company&#146;s proxy statement and proxy card and to be presented
at the Company&#146;s next annual meeting must be received by the Company by July 2,
2008, in order to be considered for inclusion in the Company&#146;s proxy materials.
Such proposals should be addressed to the Company&#146;s Secretary and may be
included in next year&#146;s proxy materials if they comply with certain rules and
regulations of the Securities and Exchange Commission governing shareholder
proposals.<u> </u>Proposals
by shareholders at the Company&#146;s 2008 Annual Shareholders&#146; Meeting that are not
intended for inclusion in the Company&#146;s proxy materials must also be received
by the Company&#146;s Secretary no later than July 2, 2008.&nbsp; Every shareholder
notice must also comply with certain other requirements set forth
in the Company&#146;s Bylaws, a copy of which may be obtained by written request
delivered to the Company&#146;s Secretary.</p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;page-break-after:avoid;text-autospace:none;font-family:"Times New Roman";font-weight:bold'><a name="_DV_M278"></a>OTHER MATTERS</p>
<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;page-break-after:avoid;text-autospace:none;font-family:"Times New Roman";'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; The Board of Directors knows of no other matters which will be
acted upon at the Annual Meeting. If any other matters are presented properly
for action at the Annual Meeting or at any adjournment or postponement thereof,
it is intended that the proxy will be voted with respect thereto in accordance
with the best judgment and in the discretion of the proxy holder.</p>
<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;page-break-after:avoid;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";font-weight:bold;'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'><a name="_DV_M279"></a>Page
19</p>

<div style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:center'>

<hr size=2 width="100%" noshade color=navy align=center>

</div>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<font face="Times New Roman">

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


</font>


<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:left'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-indent:.5in;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>

<p style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-indent:.5in;text-autospace:none;font-family:"Times New Roman"'><a name="_DV_M280"></a><b>THE COMPANY&#146;S SHAREHOLDERS ARE URGED TO
PROMPTLY SUBMIT THEIR PROXY OR VOTING
INSTRUCTIONS AS SOON AS POSSIBLE BY FOLLOWING THE INSTRUCTIONS IN THE NOTICE OF
INTERNET AVAILABILITY OF PROXY MATERIALS, WHICH WAS MAILED TO YOU ON OR ABOUT
OCTOBER 24, 2007.&nbsp; IF YOU REQUEST PRINTED COPIES OF THE PROXY MATERIALS BY
MAIL, YOU CAN ALSO VOTE BY MAIL OR BY TELEPHONE.</b></p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:12.0pt;margin-right:0in;
margin-bottom:0in;margin-left:3in;margin-bottom:.0001pt;text-align:left;
'>By
Order of the Board of Directors,<br>
<br>
PRO-DEX, INC.<br>
<br>
/s/ Jeffrey J. Ritchey<br>
Corporate Secretary</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:12.0pt;margin-right:0in;
margin-bottom:0in;margin-left:3in;margin-bottom:.0001pt;text-align:left;
'>Santa
Ana, California<br>
October 19, 2007</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-top:12.0pt; margin-left:0in; margin-right:0in'>SHAREHOLDERS
MAY OBTAIN FREE OF CHARGE A PAPER COPY OF THE COMPANY&#146;S ANNUAL REPORT ON FORM
10-KSB FOR THE FISCAL YEAR ENDED <a name="_DV_C330">JUNE</a>
30, 2007, (WITHOUT EXHIBITS) AS FILED WITH THE SECURITIES AND EXCHANGE
COMMISSION BY WRITING TO:&nbsp; INVESTOR RELATIONS, PRO-DEX, INC., 151 E. COLUMBINE
AVE, SANTA ANA, CALIFORNIA 92707 OR CALLING (714) 241-4411.</p>
<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:10.0pt;font-family:"Times New Roman";margin-top:12.0pt; margin-left:0in; margin-right:0in'>&nbsp;</p>
<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:10.0pt;font-family:"Times New Roman";margin-top:12.0pt; margin-left:0in; margin-right:0in'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'>Page 20</p>

<div style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:center'>

<hr size=2 width="100%" noshade color=navy align=center>

</div>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";line-height:1.0pt; margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp;</p>

</div>

<font face="Times New Roman">

<u><br clear=all style='page-break-before:always'>
</u>

</font>

<div style='page:Section3;'>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";line-height:1.0pt; margin-left:0in; margin-right:0in; margin-top:0in'><a name="_DV_M361"></a>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:left'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'><b>THIS PROXY IS
SOLICITED BY THE BOARD OF DIRECTORS</b></p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'><b>ANNUAL MEETING OF
SHAREHOLDERS </b></p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'><b>TO BE HELD
DECEMBER 4, 2007 </b></p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:center'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman"; margin-left:0in; margin-right:0in; margin-top:0in'>The undersigned hereby appoints Valerio Giannini and Mark P.
Murphy, and each of them, individually, as attorneys and proxies, with full
power of substitution, to represent and vote, as designated below, all shares
of Common Stock of Pro-Dex, Inc. held of record by the undersigned on October
15,&nbsp;2007, at the Annual Meeting of Shareholders to be held at the
DoubleTree Hotel Santa Ana, 201 E. MacArthur Blvd, Santa Ana, California 92707
on December 4, 2007, at 8:00&nbsp;a.m., local time, and at any and all
adjournments or postponements thereof.</p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-left:81.0pt;text-indent:-81.0pt; margin-right:0in; margin-top:0in'>Proposal No.
2.&nbsp;&nbsp;&nbsp; To elect three persons to serve as directors of the Company and, if
Proposal No. 1 is not approved, then to elect such persons as directors to the
classes as indicated beneath their names as follows (check one box):</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-left:35.0pt;text-indent:-17.0pt; margin-right:0in; margin-top:0in'>&nbsp;</p>

<table class=MsoNormalTable border=0 cellpadding=0
 style='border-collapse:collapse' width="100%">
 <tr>
  <td width=330 valign=top style='width:247.5pt;padding:0in 0in 0in 0in'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman"; margin-left:0in; margin-right:0in; margin-top:0in'>FOR [___]</p>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:left; margin-left:0in; margin-right:0in; margin-top:0in'>approval of the
  election of the nominees listed below (except as marked to the contrary
  below). </p>
  </td>
  <td width=292 valign=top style='width:218.75pt;padding:0in 0in 0in 0in'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman"; margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp;&nbsp;&nbsp;&nbsp; WITHHOLD AUTHORITY [____]</p>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:right; margin-left:0in; margin-right:0in; margin-top:0in'>to vote for the
  nominees listed below. </p>
  </td>
  <td width=2 valign=top style='width:1.75pt;padding:0in 0in 0in 0in'>
  <p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman"; margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp;</p>
  </td>
 </tr>
</table>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>

<table border="0" style="border-collapse: collapse" width="100%" id="table1">
	<tr>
		<td width="28%" valign="top">

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-left:35.0pt;text-indent:-18.5pt; margin-right:0in; margin-top:0in'>
George J. Isaac</p></td>
		<td width="38%" valign="top">Michael A. Mesenbrink</td>
		<td width="34%" valign="top">William F. Healey</td>
	</tr>
	<tr>
		<td width="28%" valign="top">

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-left:35.0pt;text-indent:-18.5pt; margin-right:0in; margin-top:0in'>(Class I)</p>
		</td>
		<td width="38%" valign="top">(Class I)</td>
		<td width="34%" valign="top">(Class II)&nbsp; </td>
	</tr>
	<tr>
		<td width="28%" valign="top">

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>

		</td>
		<td width="38%" valign="top">&nbsp;</td>
		<td width="34%" valign="top">&nbsp;</td>
	</tr>
	<tr>
		<td width="28%" valign="top">

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>

		</td>
		<td width="38%" valign="top">&nbsp;</td>
		<td width="34%" valign="top">&nbsp;</td>
	</tr>
	<tr>
		<td valign="top" colspan="3">

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-left:81.0pt;text-indent:-81.0pt; margin-right:0in; margin-top:0in'>
Proposal No. 1.&nbsp;&nbsp;To approve the amendment of the Company&#146;s
		Articles of Incorporation (circle one).</p>

		</td>
	</tr>
	<tr>
		<td width="28%" valign="top">

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>

		</td>
		<td width="38%" valign="top">&nbsp;</td>
		<td width="34%" valign="top">&nbsp;</td>
	</tr>
	<tr>
		<td width="28%" valign="top">

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'>
FOR</p></td>
		<td width="38%" valign="top">
		<p align="center">AGAINST</td>
		<td width="34%" valign="top">
		<p align="center">ABSTAIN</td>
	</tr>
	<tr>
		<td width="28%" valign="top">

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>

		</td>
		<td width="38%" valign="top">&nbsp;</td>
		<td width="34%" valign="top">&nbsp;</td>
	</tr>
	<tr>
		<td width="28%" valign="top">

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";margin-left:35.0pt;text-indent:-18.5pt'>&nbsp;</p>

		</td>
		<td width="38%" valign="top">&nbsp;</td>
		<td width="34%" valign="top">&nbsp;</td>
	</tr>
	<tr>
		<td width="100%" valign="top" colspan="3">

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-left:81.0pt;text-indent:-81.0pt; margin-right:0in; margin-top:0in'>
Proposal No. 3.&nbsp;To ratify the appointment of
		Moss Adams, LLP as the Company&#146;s independent
auditors for the fiscal year ending June 30, 2008 (circle one). </p>

		</td>
	</tr>
	<tr>
		<td width="28%" valign="top">

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp;</p>

		</td>
		<td width="38%" valign="top">&nbsp;</td>
		<td width="34%" valign="top">&nbsp;</td>
	</tr>
	<tr>
		<td width="28%" valign="top">

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:center'>
<font size="3">FOR &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></p>

		</td>
		<td width="38%" valign="top">
		<p align="center">AGAINST</td>
		<td width="34%" valign="top">
		<p align="center">ABSTAIN</td>
	</tr>
	<tr>
		<td width="28%" valign="top">

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>

		</td>
		<td width="38%" valign="top">&nbsp;</td>
		<td width="34%" valign="top">&nbsp;</td>
	</tr>
	<tr>
		<td width="100%" valign="top" colspan="3">

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-left:81.0pt;text-indent:-81.0pt; margin-right:0in; margin-top:0in'>
Proposal No. 4.&nbsp;In their discretion, the
		proxies are authorized to vote upon such other business as may properly
		come before the meeting or any adjournment or postponement thereof. </p>

		</td>
	</tr>
</table>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";'>&nbsp;</p>

<div style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";text-align:center'>

&nbsp;</div>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'>This proxy when
properly executed will be voted in the manner directed herein by the
undersigned shareholder. If no direction is made, this proxy will be voted
&#147;FOR&#148; all Proposals. </p>
<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp;</p>
<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp;</p>
<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp;</p>
<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:center; margin-left:0in; margin-right:0in; margin-top:0in'>
Page 1</p>

<div style='margin-top:12.0pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";margin-top:0in;text-align:center'>
	<hr size=2 width="100%" noshade color=navy align=center></div>
<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>



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



<p><b>PLEASE MARK, SIGN, DATE
AND RETURN THIS PROXY PROMPTLY USING THE ENCLOSED ENVELOPE. </b></p>
<p>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-left:3.5in;text-align:justify; margin-right:0in; margin-top:0in'>&nbsp;</p>
<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-left:3.5in;text-align:justify; margin-right:0in; margin-top:0in'>&nbsp;</p>
<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-left:3.5in;text-align:justify; margin-right:0in; margin-top:0in'>&nbsp;</p>
<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-left:3.5in;text-align:justify; margin-right:0in; margin-top:0in'>&nbsp;</p>
<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-left:3.5in;text-align:justify; margin-right:0in; margin-top:0in'>Dated:_______________,
2007 <br>
<br>
</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-left:3.5in; margin-right:0in; margin-top:0in'>Name: <u>&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; </u><br>
<br>
</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-left:3.5in; margin-right:0in; margin-top:0in'>Common Shares: <u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </u>&nbsp;<br>
&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-left:3.5in; margin-right:0in; margin-top:0in'><u>&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;</u></p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-left:3.5in; margin-right:0in; margin-top:0in'>Signature </p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";margin-left:3.5in'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-left:3.5in; margin-right:0in; margin-top:0in'><u>&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;</u></p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";margin-left:3.5in; margin-right:0in; margin-top:0in'>Signature (if jointly held) </p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-size:11.0pt;font-family:"Times New Roman";margin-left:3.5in;text-indent:-9.0pt; margin-right:0in; margin-top:0in'>&nbsp;</p>

<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:justify; margin-left:3.5in; margin-right:0.5in; margin-top:0in'>Please sign exactly
as name appears in the records of Pro-Dex, Inc. When shares are held by joint
tenants, both should sign. When signing as attorney, as executor,
administrator, trustee or guardian, please give full title as such. If a
corporation, please sign in full corporate name by President or other
authorized officer. If a partnership, please sign in partnership name by
authorized person. </p>
<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:justify; margin-left:3.5in; margin-right:0.5in; margin-top:0in'>&nbsp;</p>
<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:justify; margin-left:3.5in; margin-right:0.5in; margin-top:0in'>&nbsp;</p>
<p style='margin-bottom:.0001pt;text-align:justify;text-autospace:none;font-family:"Times New Roman";text-align:justify; margin-left:3.5in; margin-right:0.5in; margin-top:0in'>&nbsp;</p>

</div>

</body>

</html>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>GRAPHIC
<SEQUENCE>2
<FILENAME>image002.jpg
<TEXT>
begin 644 image002.jpg
M_]C_X``02D9)1@`!`0$`8`!@``#_VP!#``H'!P@'!@H("`@+"@H+#A@0#@T-
M#AT5%A$8(Q\E)"(?(B$F*S<O)BDT*2$B,$$Q-#D[/CX^)2Y$24,\2#<]/CO_
MVP!#`0H+"PX-#AP0$!P[*"(H.SL[.SL[.SL[.SL[.SL[.SL[.SL[.SL[.SL[
M.SL[.SL[.SL[.SL[.SL[.SL[.SL[.SO_P``1"`!``)D#`2(``A$!`Q$!_\0`
M'P```04!`0$!`0$```````````$"`P0%!@<("0H+_\0`M1```@$#`P($`P4%
M!`0```%]`0(#``01!1(A,4$&$U%A!R)Q%#*!D:$((T*QP152T?`D,V)R@@D*
M%A<8&1HE)B<H*2HT-38W.#DZ0T1%1D=(24I35%565UA96F-D969G:&EJ<W1U
M=G=X>7J#A(6&AXB)BI*3E)66EYB9FJ*CI*6FIZBIJK*SM+6VM[BYNL+#Q,7&
MQ\C)RM+3U-76U]C9VN'BX^3EYN?HZ>KQ\O/T]?;W^/GZ_\0`'P$``P$!`0$!
M`0$!`0````````$"`P0%!@<("0H+_\0`M1$``@$"!`0#!`<%!`0``0)W``$"
M`Q$$!2$Q!A)!40=A<1,B,H$(%$*1H;'!"2,S4O`58G+1"A8D-.$E\1<8&1HF
M)R@I*C4V-S@Y.D-$149'2$E*4U155E=865IC9&5F9VAI:G-T=79W>'EZ@H.$
MA8:'B(F*DI.4E9:7F)F:HJ.DI::GJ*FJLK.TM;:WN+FZPL/$Q<;'R,G*TM/4
MU=;7V-G:XN/DY>;GZ.GJ\O/T]?;W^/GZ_]H`#`,!``(1`Q$`/P#V6BBB@`HH
MHH`****`"H9Y_+1MB^8X!PN<9/IFB67'RK^)J&F,S?[:N;^V=]/*1SQ-B2"4
M?,I[J?3V-4!XAOI0_ER^7+&<20R(-R'W]O>J?B*=-&\26.H*2BSJ5N`O\:@X
MR1WX/Z4[6H6ELTU:WB>&XB7=M8<LG=6'TYK9)&B2'?\`"=7%C<+'?6BRH1]Z
M([6'X'@UTNDZYI^M0F2RG#E?OQGAT^HKS352EU-$\7(:$N/:L<3W=C.E]I\S
M0W,7(9>X]".X]JT]E&7D5R)GN=%<_P"#_%4'BC3#)A8[R'"W$(/0_P!X>QKH
M*Y91<79F+33LPHHHI""BBB@`HHHH`S?$>HRZ1X;U'4H2GFVML\J>8,J2HR`:
M\>L_CCXHO)EM[?0K*YF;HD22%C^`-=]\7=0%A\.K\;L-<E(%]\L"?T!KSOX#
M:;Y_B6^U%ER+6VV*?1G/^`-`%N?XW>)].N%CU+PW;P9YV.LD;$>V3_2O5/"G
MBBR\7:''JED&0$E)(F^]&XZJ?7KUKRKX\:WI]Y=:;I5M(DMS:[Y)F0@[-V`%
M)]>"<?2L_1;C5_"OP<GU:SNY;&:\U)?)90,LFW!ZCH<'\J`/?Z;(VQ":^;?#
MWC+QU?ZC<+IMU?:E?S0F-,DN(5)!+!?N@\8R?6O2?ACHOB6VDOK[Q-+??:[A
MQ'''<REOE');&<=3C\*`._HI+RX:V\N&VC1YY<XWGA0.K'\QQ[U+;F26(BX$
M>\'&4S@_G3&8NIZ,NI:M974Q4P6JL2AZLV1C\*DO0&5@>01@U<:4;3Z@E3^!
MQ67>S`*>:M79:*.B^#;:?3EN)YYTDD!4KD84!CC''XU4M_#?A2[G%O;^(/,F
M)P%65,D^W'-=1>SG3?"<TX^]':DC_>(X_4UXY+>16_#Y^7H0*U@ISO9E14I7
MU.LE\-7OP_UV'Q!:71N-,9Q%>*5PT<;'&3V(!P<UZ:""`0<@]#7/ZZXN?AW>
MR7'/F:8SMN]?+S_.N`\8?$RZT?P9HMCIDNS4[VR226;&3$F,9'^T2#],?2HF
MW*-WNM"9-R5V>O,Z(0&=5STR<4ZOGM?AWJ&H>"KCQAKNNR12F!IXDFRY<?PY
M8G@MV^HKH?@;KFIZB=2TB]GDN;**%7C$K%O+)."H)[$=O:L3,]CHKYG\?66K
M^$?%L]C%J%X+1B)[3,[$;">!U[$$?A6UXV^)%YXRM]+T70DG5W$;W!CR&>?'
MW![`]^_X4`>_45R/P_\`!T_AG3?.U*[FN]3N%'G-)*7$8_N+D_K774`>0_'[
M40NG:3IH;F25YV'^Z,#_`-"-<CX-^&&M>)]"&JV.K1644LC)L8N"VWC/%=?X
MX^&'B?Q=XGN=2^VV,=OPEO&SME4`QSQU/4UZ#X,T.7PWX3L=)G*&:!#YAC.5
M+$DG'YT`>>:)\!H8;Q9];U;[5&IR88$*A_8L><?2D^.T\%CH.BZ+;*L4?F-(
ML2#`547:/_0J]@KS#XD_#G7O&FOQ7=I=6<5K!;B.-968-G))/`]Q^5`#_@7I
M26OA&?42@$MY<$;L<[%X`_/->CL#]J0X&W8W.>^163X-T27P[X3L-*G*&:WC
M(D,9RI8DDX_.KVKBX73WFM#B>']X@QD-CJ#]130%:]EV:HQ;C$2A?S.?Z5=2
M5+6Q:XF.U%4NQ/85Q?\`PL-^!<Z&KRCH5F&/PRM5;[Q>^I$?:%9(E(9;>-3@
MGL6)Z_H*T]G+:Q?*]CI(-;>S@"O823,Y+NP=0`2<XY/:L_5-;.JR6UK%:2V_
M[WYMS*=Q/`'!]ZY]M9GF<LR>5$!P&ZDTW2]7LX-<MY[Z<101,79MI;D#@8'/
M6M%2MJ6H6U.O\?7(M/",R`X\UXXQ^8/\A7D%I93:WK%MIUN"7N)`O^Z.Y/L!
MDUZCK7B?P/K=H+/4]1.Q7#@;)$(./I[FLW3_`!1X'\/F1?#UK+>73C#,B-DC
MW=^@^GY55*3A%Z.XX2<8[:FK\2+V/3?!4UC&<-<IY2#/1`,L?R`'XU\]^(3/
M)K"P2@AHH8HE![#8,?S_`%KTS4I[_P`8^(+:RG;,U[($V)]V"$'+8_#OW-2_
M%3X8ZC?ZF-;T"V^T!XU2>V3&Y2HVAAZC`''M6<URP47UU(DK12,H^`?B3XH@
MMK/5[KR;&$*$269=B`#`^1>O%>J>"/!5EX*TIK6W<SSS$-/.PP7/H!V`KR[3
M?$WQ:M+2/3H=,N)?*4(CS667`'3GH?QKI9;WX@Z?X'2UCT^]O==U!WDFN#MQ
M:H3@`<XW8'`'`K`S.<^.6OZ1J&H6FEVJB:^L2WG3J>$!_P"6?N<X)]/SJ+X$
MMI1\1WD=S`#J'D[[61NRC[X`]>1^&:V?AC\,)8I+G5O%-DPG;='%;S\GD?,Y
M]SGBN5L_!'C+PMXQ%]I6C74\5C=$Q2+C$T8./7NO\Z`/HJBHX)?/@CE\MX]Z
MAMCC#+GL1ZU)0`4444`%%%%`!1110!YGXVT631[DWT"%K&=LG`XB;T^A[5RO
M]H[1PYQZ9KW.:&*XA>&:-9(W&UD89!%>;^(_A;(SO<>'YU`)S]EF;`'^ZW]#
M^==E*K%Z2.B$UM(Y$7_G2K'U+'N:9>73V^%AA+R-T(&0*I7NB>(=)GS<Z3=Q
ME#G>(BZ_F,BI8M6N7^3^R[IY/2.,G/Z5TN/5:HVMV(DTVYO)/-NW*`]1_%_]
M:KKM:Z7;`*F,G"HO+2'T]S5VPT'Q=K38M-'-E&?^6UW\@'X'D_@*[_PM\.[+
M0IUU"_F.HZD.1+(/EB/^P/Z_RK.=1+XG\D1*:6Y'\/\`PK-I4#ZQJ:8U*\4`
D1G_EA'U"_7N:[2BBN"4G)W9RR;;NPHHHJ1!1110`4444`?_9
`
end
</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
-----END PRIVACY-ENHANCED MESSAGE-----
