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<SEC-DOCUMENT>0000910680-09-000242.txt : 20090511
<SEC-HEADER>0000910680-09-000242.hdr.sgml : 20090511
<ACCEPTANCE-DATETIME>20090511161839
ACCESSION NUMBER:		0000910680-09-000242
CONFORMED SUBMISSION TYPE:	10-Q
PUBLIC DOCUMENT COUNT:		7
CONFORMED PERIOD OF REPORT:	20090331
FILED AS OF DATE:		20090511
DATE AS OF CHANGE:		20090511

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			LIFETIME BRANDS, INC
		CENTRAL INDEX KEY:			0000874396
		STANDARD INDUSTRIAL CLASSIFICATION:	CUTLERY, HANDTOOLS & GENERAL HARDWARE [3420]
		IRS NUMBER:				112682486
		STATE OF INCORPORATION:			DE
		FISCAL YEAR END:			1207

	FILING VALUES:
		FORM TYPE:		10-Q
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	000-19254
		FILM NUMBER:		09815222

	BUSINESS ADDRESS:	
		STREET 1:		1000 STEWART AVENUE
		CITY:			GARDEN CITY
		STATE:			NY
		ZIP:			11530
		BUSINESS PHONE:		5166836000

	MAIL ADDRESS:	
		STREET 1:		1000 STEWART AVENUE
		STREET 2:		1000 STEWART AVENUE
		CITY:			GARDEN CITY
		STATE:			NY
		ZIP:			11530

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	LIFETIME HOAN CORP
		DATE OF NAME CHANGE:	19930328
</SEC-HEADER>
<DOCUMENT>
<TYPE>10-Q
<SEQUENCE>1
<FILENAME>f10q033109.htm
<DESCRIPTION>FORM 10Q
<TEXT>
<html>
    <head>
        <title></title>
    </head>

    <body style="FONT-FAMILY: 'Times New Roman'" bgcolor="#ffffff">
        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <div align="left">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="100%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">UNITED STATES</font></b></p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="100%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">SECURITIES AND EXCHANGE COMMISSION</font></b></p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="100%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">Washington, D.C. 20549</font></b></p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="100%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 236.25pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="100%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="4">FORM 10-Q</font></b></p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="100%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="100%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><b><font size="2">(Mark One)</font></b></p>
                    </td>
                </tr>
            </table>
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <div align="left">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="5%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font face="Wingdings">x</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="94%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><b><font size="2">QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934</font></b></p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="5%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="94%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="5%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="94%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="5%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="94%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font size="2">For the quarterly period ended March 31, 2009</font></p>

                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">OR</font></b></p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="5%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="94%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="5%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="94%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="5%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font face="Wingdings">o</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="94%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><b><font size="2">TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 <br>
                        FOR THE TRANSITION PERIOD FROM ________ TO ________</font></b></p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="5%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="94%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="5%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="94%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>
                </tr>
            </table>
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <div align="left">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="100%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font size="2">Commission file number 0-19254</font></p>

                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="100%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="4">LIFETIME BRANDS, INC.</font></b></p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="100%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font size="2">(Exact name of registrant as specified in its charter)</font></p>
                    </td>
                </tr>
            </table>
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <div align="left">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="58%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">Delaware</font></b></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="41%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">11-2682486</font></b></p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="58%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font size="2">(State or Other Jurisdiction of Incorporation or Organization)</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="41%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font size="2">(I.R.S. Employer Identification No.)</font></p>
                    </td>
                </tr>
            </table>
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <div align="left">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="100%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">1000 Stewart Avenue, Garden City, New York, 11530</font></b></p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="100%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font size="2">(Address of principal executive offices, including Zip Code)</font></p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="100%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="100%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font size="2">(Registrant's telephone number, including area code) (</font><b><font size="2">516) 683-6000</font></b></p>
                    </td>
                </tr>
            </table>
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt"><font size="2">Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.&nbsp;</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt" align="right"></p>

        <table cellspacing="0" cellpadding="0" width="10%" align="right" border="0">
            <tr>
                <td width="2%"><font size="2">Yes</font></td>

                <td width="2%"><font face="Wingdings">x</font> </td>

                <td width="2%">
                </td>

                <td width="2%"><font size="2">No </font></td>

                <td width="2%">
                    <p align="right"><font face="Wingdings">o</font></p>
                </td>
            </tr>
        </table>

        <p align="right"><br>
        <br>
        </p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt" align="right"></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt" align="right">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><font size="2">Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (&sect;232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). </font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt" align="right"></p>

        <table cellspacing="0" cellpadding="0" width="10%" align="right" border="0">
            <tr>
                <td width="2%"><font size="2">Yes</font></td>

                <td width="2%">
                    <p align="right"><font face="Wingdings">o</font></p>
                </td>

                <td width="2%">
                </td>

                <td width="2%"><font size="2">No </font></td>

                <td width="2%">
                    <p align="right"><font face="Wingdings">x</font></p>
                </td>
            </tr>
        </table>
        <br>
        <br>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><font size="2">Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of&nbsp; &ldquo;large accelerated filer&rdquo;, &ldquo;accelerated filer&rdquo; and &ldquo;smaller reporting company&rdquo; in Rule 12b-2 of the Exchange Act. </font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <div align="left">
            <table style="MARGIN-LEFT: 0.4pt; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
                <tr style="HEIGHT: 16.65pt">
                    <td style="PADDING-RIGHT: 0px; PADDING-LEFT: 0px; PADDING-BOTTOM: 0px; MARGIN: 0px; PADDING-TOP: 0px" valign="top" align="left" width="180">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 16pt; TEXT-ALIGN: left"><font size="2">Large accelerated filer&nbsp;</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 0px; PADDING-LEFT: 0px; PADDING-BOTTOM: 0px; MARGIN: 0px; PADDING-TOP: 0px" valign="top" align="left" width="376"><font face="Wingdings">o</font></td>

                    <td style="PADDING-RIGHT: 0px; PADDING-LEFT: 0px; PADDING-BOTTOM: 0px; MARGIN: 0px; PADDING-TOP: 0px" valign="top" align="left" width="186">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Accelerated filer&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </font></p>
                    </td>

                    <td style="PADDING-RIGHT: 0px; PADDING-LEFT: 0px; PADDING-BOTTOM: 0px; MARGIN: 0px; PADDING-TOP: 0px" valign="top" align="left" width="371"><font face="Wingdings">x</font></td>
                </tr>

                <tr style="HEIGHT: 26.1pt">
                    <td style="PADDING-RIGHT: 0px; PADDING-LEFT: 0px; PADDING-BOTTOM: 0px; MARGIN: 0px; PADDING-TOP: 0px" valign="top" align="left" width="180" colspan="1">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 16pt; TEXT-ALIGN: left"><font size="2">Non-accelerated filer&nbsp;&nbsp; </font></p>
                    </td>

                    <td style="PADDING-RIGHT: 0px; PADDING-LEFT: 0px; PADDING-BOTTOM: 0px; MARGIN: 0px; PADDING-TOP: 0px" valign="top" align="left" width="376"><font face="Wingdings">o</font> <font size="2">(Do not check if a smaller reporting company)</font></td>

                    <td style="PADDING-RIGHT: 0px; PADDING-LEFT: 0px; PADDING-BOTTOM: 0px; MARGIN: 0px; PADDING-TOP: 0px" valign="top" align="left" width="186" colspan="1">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Smaller reporting company&nbsp; </font></p>
                    </td>

                    <td style="PADDING-RIGHT: 0px; PADDING-LEFT: 0px; PADDING-BOTTOM: 0px; MARGIN: 0px; PADDING-TOP: 0px" valign="top" align="left" width="371"><font face="Wingdings">o</font></td>
                </tr>
            </table>
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><font size="2">Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes <font face="Wingdings"><font size="2"><font size="3">o</font>&nbsp;</font></font>&nbsp;No </font><font face="Wingdings">x</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><font size="2">The number of shares of the registrant&rsquo;s common stock outstanding as of May 11, 2009 was 11,989,724. </font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <div title="EE+ Page Break" style="FONT-SIZE: 1pt; PAGE-BREAK-AFTER: always; WIDTH: 100%; HEIGHT: 1px">
            <hr align="center" width="100%" noshade size="2">
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><b><font size="3">LIFETIME BRANDS, INC.</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><b><font size="2">FORM 10-Q</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><b><font size="2">FOR THE QUARTER ENDED MARCH 31, 2009</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><b><font size="2">INDEX</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <div align="left">
            <table style="MARGIN-LEFT: 23.4pt; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="14%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><b><font size="2">Part I. </font></b></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="73%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><b><a href="#part1"><font size="2"><b><font size="2">Financial Information</font></b></font></a></b></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="12%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt" align="center"><b><font size="2">Page No.</font></b></p>

                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="14%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Item 1.</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="73%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><a href="#financialstmts"><font size="2"><font size="2">Financial Statements</font></font></a></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="12%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="14%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="73%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="12%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="14%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="73%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><a href="#balance"><font size="2"><font size="2">Condensed Consolidated Balance Sheets &ndash; March 31, 2009 (unaudited) and December 31, 2008</font></font></a></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="12%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font size="2">2</font></p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="14%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="73%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="12%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="14%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="73%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><a href="#stmtoperations"><font size="2"><font size="2">Unaudited Condensed Consolidated Statements of Operations &ndash; Three Months Ended March 31, 2009 and 2008</font></font></a></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="12%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font size="2">3</font></p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="14%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="73%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="12%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="14%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="73%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><a href="#stmtcashflows"><font size="2"><font size="2">Unaudited Condensed Consolidated Statements of Cash Flows &ndash; Three Months Ended March 31, 2009 and 2008</font></font></a></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="12%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font size="2">4</font></p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="14%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="73%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="12%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="14%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="73%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><a href="#notes"><font size="2"><font size="2">Notes to Unaudited Condensed Consolidated Financial Statements</font></font></a></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="12%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font size="2">5</font></p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="14%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="73%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="12%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="14%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="73%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><a href="#report"><font size="2"><font size="2">Report of Independent Registered Public Accounting Firm</font></font></a></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="12%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font size="2">18</font></p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="14%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="73%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="12%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="14%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Item 2.</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="73%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><a href="#p1item2"><font size="2"><font size="2">Management&rsquo;s Discussion and Analysis of Financial Condition and Results of Operations</font></font></a></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="12%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font size="2">19</font></p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="14%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="73%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="12%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="14%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Item 3.</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="73%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><a href="#p1item3"><font size="2"><font size="2">Quantitative and Qualitative Disclosure About Market Risk</font></font></a></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="12%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font size="2">26</font></p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="14%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="73%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="12%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="14%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Item 4.</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="73%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><a href="#p1item4"><font size="2"><font size="2">Controls and Procedures</font></font></a></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="12%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font size="2">26</font></p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="14%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="73%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="12%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="14%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><b><font size="2">Part II.</font></b></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="73%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><b><a href="#part2"><font size="2"><b><font size="2">Other Information</font></b></font></a></b></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="12%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="14%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="73%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="12%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="14%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Item 1A.</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="73%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><a href="#p2item1a"><font size="2"><font size="2">Risk Factors</font></font></a></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="12%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font size="2">26</font></p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="14%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="73%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="12%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="14%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Item 6.</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="73%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><a href="#p2item6"><font size="2"><font size="2">Exhibits</font></font></a></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="12%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font size="2">26</font></p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="14%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="73%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="12%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="14%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><a href="#signatures"><font size="2"><font size="2">Signatures</font></font></a></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="73%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="12%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font size="2">27</font></p>
                    </td>
                </tr>
            </table>
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <div title="EE+ Page Footer">
            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"></p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"></p>
        </div>

        <div title="EE+ Page Break" style="FONT-SIZE: 1pt; PAGE-BREAK-AFTER: always; WIDTH: 100%; HEIGHT: 1px">
            <hr align="center" width="100%" noshade size="2">
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><font size="2">PART 1. <a name="part1">FINANCIAL INFORMATION</a></font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><b><font size="2">ITEM 1. <a name="financialstmts">FINANCIAL STATEMENTS</a></font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><b><font size="2">LIFETIME BRANDS, INC. </font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><b><font size="2">CONDENSED CONSOLIDATED <a name="balance">BALANCE SHEETS</a></font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><font size="2">(In thousands, except share data)</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center">&nbsp;</p>

        <div align="center">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="95%" border="0">
                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="719">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="30">
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" colspan="3">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="42">
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" colspan="3">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="10">
                    </td>
                </tr>

                <tr bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="719">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="30">
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" colspan="3">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">March 31,</font></b></p>
                    </td>

                    <td valign="bottom" align="left" width="42">
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" colspan="3">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">December 31,</font></b></p>
                    </td>

                    <td valign="bottom" align="left" width="10">
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="719">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="30">
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="top" colspan="3">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">2009</font></b></p>
                    </td>

                    <td valign="bottom" align="left" width="42">
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="top" colspan="3">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">2008</font></b></p>
                    </td>

                    <td valign="bottom" align="left" width="10">
                    </td>
                </tr>

                <tr bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="bottom" width="719">
                        <p style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="30">
                    </td>

                    <td valign="bottom" align="left" width="17">
                    </td>

                    <td valign="top" align="center" colspan="2">
                        <p align="center"><font size="2">(unaudited)</font></p>
                    </td>

                    <td valign="bottom" align="left" width="42">
                    </td>

                    <td valign="bottom" align="left" width="22">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p align="center"><font size="2">(as adjusted <br>
                        see Note F)</font></p>
                    </td>

                    <td valign="bottom" align="left" width="10">
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="bottom" width="719">
                        <p style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><b><font size="2">ASSETS</font></b></p>
                    </td>

                    <td valign="bottom" align="left" width="30">
                    </td>

                    <td valign="bottom" align="left" width="17">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="42">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="22">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="10">
                        <p>&nbsp;</p>
                    </td>
                </tr>

                <tr bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="bottom" width="719">
                        <p style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">CURRENT ASSETS</font></p>
                    </td>

                    <td valign="bottom" align="left" width="30">
                    </td>

                    <td valign="bottom" align="left" width="17">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="42">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="22">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="10">
                        <p>&nbsp;</p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="bottom" width="719">
                        <p style="MARGIN-LEFT: 0.2in; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Cash and cash equivalents</font></p>
                    </td>

                    <td valign="bottom" align="left" width="30">
                    </td>

                    <td valign="bottom" align="left" width="17">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="right" width="34">
                        <p><font size="2">$</font></p>
                    </td>

                    <td valign="bottom" width="89">
                        <p align="right"><font size="2">2,048 </font></p>
                    </td>

                    <td valign="bottom" align="left" width="42">
                    </td>

                    <td valign="bottom" align="left" width="22">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="right" width="40">
                        <p><font size="2">$</font></p>
                    </td>

                    <td valign="bottom" width="57">
                        <p align="right"><font size="2">3,478</font></p>
                    </td>

                    <td valign="bottom" align="left" width="10">
                    </td>
                </tr>

                <tr bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="bottom" width="719">
                        <p style="MARGIN-LEFT: 13.5pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Accounts receivable, less allowances of $14,897 at 2009 and $14,651 at 2008</font></p>
                    </td>

                    <td valign="bottom" align="left" width="30">
                    </td>

                    <td valign="bottom" align="left" width="17">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">59,877</font></p>
                    </td>

                    <td valign="bottom" align="left" width="42">
                    </td>

                    <td valign="bottom" align="left" width="22">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">67,562</font></p>
                    </td>

                    <td valign="bottom" align="left" width="10">
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="bottom" width="719">
                        <p style="MARGIN-LEFT: 0.2in; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Inventory</font></p>
                    </td>

                    <td valign="bottom" align="left" width="30">
                    </td>

                    <td valign="bottom" align="left" width="17">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">131,942</font></p>
                    </td>

                    <td valign="bottom" align="left" width="42">
                    </td>

                    <td valign="bottom" align="left" width="22">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">141,612</font></p>
                    </td>

                    <td valign="bottom" align="left" width="10">
                    </td>
                </tr>

                <tr bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="bottom" width="719">
                        <p style="MARGIN-LEFT: 0.2in; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Income taxes receivable</font></p>
                    </td>

                    <td valign="bottom" align="left" width="30">
                    </td>

                    <td valign="bottom" align="left" width="17">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">11,597</font></p>
                    </td>

                    <td valign="bottom" align="left" width="42">
                    </td>

                    <td valign="bottom" align="left" width="22">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">11,597</font></p>
                    </td>

                    <td valign="bottom" align="left" width="10">
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="bottom" width="719">
                        <p style="MARGIN-LEFT: 0.2in; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Prepaid expenses and other current assets </font></p>
                    </td>

                    <td valign="bottom" align="left" width="30">
                    </td>

                    <td valign="bottom" align="left" width="17">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">6,831</font></p>
                    </td>

                    <td valign="bottom" align="left" width="42">
                    </td>

                    <td valign="bottom" align="left" width="22">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">8,429</font></p>
                    </td>

                    <td valign="bottom" align="left" width="10">
                    </td>
                </tr>

                <tr bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="bottom" width="719">
                        <p style="MARGIN-LEFT: 0pt; TEXT-INDENT: 21.75pt; TEXT-ALIGN: left"><font size="2">TOTAL CURRENT ASSETS</font></p>
                    </td>

                    <td valign="bottom" align="left" width="30">
                    </td>

                    <td valign="bottom" align="left" width="17">
                    </td>

                    <td style="BORDER-TOP: black 1pt solid" valign="bottom" align="right" colspan="2">
                        <p><font size="2">212,295</font></p>
                    </td>

                    <td valign="bottom" align="left" width="42">
                    </td>

                    <td valign="bottom" align="left" width="22">
                    </td>

                    <td style="BORDER-TOP: black 1pt solid" valign="bottom" align="right" colspan="2">
                        <p><font size="2">232,678</font></p>
                    </td>

                    <td valign="bottom" align="left" width="10">
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="bottom" width="719">&nbsp;</td>

                    <td valign="bottom" align="left" width="30">
                    </td>

                    <td valign="bottom" align="left" width="17">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                    </td>

                    <td valign="bottom" align="left" width="42">
                    </td>

                    <td valign="bottom" align="left" width="22">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                    </td>

                    <td valign="bottom" align="left" width="10">
                    </td>
                </tr>

                <tr bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="bottom" width="719">
                        <p style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">PROPERTY AND EQUIPMENT, net</font></p>
                    </td>

                    <td valign="bottom" align="left" width="30">
                    </td>

                    <td valign="bottom" align="left" width="17">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">48,199</font></p>
                    </td>

                    <td valign="bottom" align="left" width="42">
                    </td>

                    <td valign="bottom" align="left" width="22">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">49,908</font></p>
                    </td>

                    <td valign="bottom" align="left" width="10">
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="bottom" width="719">
                        <p style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">INTANGIBLES, net</font></p>
                    </td>

                    <td valign="bottom" align="left" width="30">
                    </td>

                    <td valign="bottom" align="left" width="17">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">38,202</font></p>
                    </td>

                    <td valign="bottom" align="left" width="42">
                    </td>

                    <td valign="bottom" align="left" width="22">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">38,420</font></p>
                    </td>

                    <td valign="bottom" align="left" width="10">
                    </td>
                </tr>

                <tr bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="bottom" width="719">
                        <p style="MARGIN-LEFT: 0.1pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">INVESTMENT IN GRUPO VASCONIA, S.A.B.</font></p>
                    </td>

                    <td valign="bottom" align="left" width="30">
                    </td>

                    <td valign="bottom" align="left" width="17">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">17,443</font></p>
                    </td>

                    <td valign="bottom" align="left" width="42">
                    </td>

                    <td valign="bottom" align="left" width="22">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">17,784</font></p>
                    </td>

                    <td valign="bottom" align="left" width="10">
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="bottom" width="719">
                        <p style="MARGIN-LEFT: 0.1pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">OTHER ASSETS</font></p>
                    </td>

                    <td valign="bottom" align="left" width="30">
                    </td>

                    <td valign="bottom" align="left" width="17">&nbsp;</td>

                    <td style="BORDER-BOTTOM: black 1pt solid" valign="bottom" align="right" colspan="2">
                        <p><font size="2">2,880</font></p>
                    </td>

                    <td style="PADDING-BOTTOM: 1pt" valign="bottom" align="left" width="42">
                    </td>

                    <td valign="bottom" align="left" width="22">&nbsp;</td>

                    <td style="BORDER-BOTTOM: black 1pt solid" valign="bottom" align="right" colspan="2">
                        <p><font size="2">2,991</font></p>
                    </td>

                    <td style="PADDING-BOTTOM: 1pt" valign="bottom" align="left" width="10">
                    </td>
                </tr>

                <tr bgcolor="#cceeff" height="20">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="bottom" width="719">
                        <p style="MARGIN-LEFT: 0in; TEXT-INDENT: 50.25pt; TEXT-ALIGN: left"><b><font size="2">TOTAL ASSETS</font></b></p>
                    </td>

                    <td valign="bottom" align="left" width="30">
                    </td>

                    <td valign="bottom" align="left" width="17">
                        <p>&nbsp;</p>
                    </td>

                    <td style="BORDER-BOTTOM: black 2.25pt double" valign="bottom" align="right" width="34" colspan="1">
                        <p><font size="2">$</font></p>
                    </td>

                    <td style="BORDER-BOTTOM: black 2.25pt double" valign="bottom" width="89">
                        <p align="right"><font size="2">319,019</font></p>
                    </td>

                    <td style="PADDING-BOTTOM: 2.25pt" valign="bottom" align="left" width="42">
                    </td>

                    <td valign="bottom" align="left" width="22">
                        <p>&nbsp;</p>
                    </td>

                    <td style="BORDER-BOTTOM: black 2.25pt double" valign="bottom" align="right" width="40" colspan="1">
                        <p><font size="2">$</font></p>
                    </td>

                    <td style="BORDER-BOTTOM: black 2.25pt double" valign="bottom" width="57">
                        <p align="right"><font size="2">341,781</font></p>
                    </td>

                    <td style="PADDING-BOTTOM: 2.25pt" valign="bottom" align="left" width="10">
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="bottom" width="719">
                        <p style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="30">
                    </td>

                    <td valign="bottom" align="left" width="17">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="42">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="22">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="10">
                        <p>&nbsp;</p>
                    </td>
                </tr>

                <tr bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="bottom" width="719">
                        <p style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><b><font size="2">LIABILITIES AND STOCKHOLDERS' EQUITY</font></b></p>
                    </td>

                    <td valign="bottom" align="left" width="30">
                    </td>

                    <td valign="bottom" align="left" width="17">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="42">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="22">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="10">
                        <p>&nbsp;</p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="bottom" width="719">
                        <p style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">CURRENT LIABILITIES</font></p>
                    </td>

                    <td valign="bottom" align="left" width="30">
                    </td>

                    <td valign="bottom" align="left" width="17">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="42">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="22">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="10">
                        <p>&nbsp;</p>
                    </td>
                </tr>

                <tr bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="bottom" width="719">
                        <p style="MARGIN-LEFT: 0.2in; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Short-term borrowings</font></p>
                    </td>

                    <td valign="bottom" align="left" width="30">
                    </td>

                    <td valign="bottom" align="left" width="17">
                    </td>

                    <td valign="bottom" align="right" width="34" colspan="1">
                        <p><font size="2">$</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 0px; PADDING-LEFT: 0px; MARGIN-LEFT: 0px; MARGIN-RIGHT: 0px" valign="bottom" width="89">
                        <p style="PADDING-RIGHT: 0px; MARGIN-RIGHT: 0px" align="right"><font size="2">79,700 </font></p>
                    </td>

                    <td valign="bottom" align="left" width="42">&nbsp;</td>

                    <td valign="bottom" align="left" width="22">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="right" width="40" colspan="1">
                        <p><font size="2">$</font></p>
                    </td>

                    <td valign="bottom" width="57">
                        <p align="right"><font size="2">89,300 </font></p>
                    </td>

                    <td valign="bottom" align="left" width="10">
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="bottom" width="719">
                        <p style="MARGIN-LEFT: 0.2in; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Accounts payable</font></p>
                    </td>

                    <td valign="bottom" align="left" width="30">
                    </td>

                    <td valign="bottom" align="left" width="17">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">23,054</font></p>
                    </td>

                    <td valign="bottom" align="left" width="42">
                    </td>

                    <td valign="bottom" align="left" width="22">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">24,151</font></p>
                    </td>

                    <td valign="bottom" align="left" width="10">
                    </td>
                </tr>

                <tr bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="bottom" width="719">
                        <p style="MARGIN-LEFT: 0.2in; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Accrued expenses</font></p>
                    </td>

                    <td valign="bottom" align="left" width="30">
                    </td>

                    <td valign="bottom" align="left" width="17">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">29,451</font></p>
                    </td>

                    <td valign="bottom" align="left" width="42">
                    </td>

                    <td valign="bottom" align="left" width="22">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">35,902</font></p>
                    </td>

                    <td valign="bottom" align="left" width="10">
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="bottom" width="719">
                        <p style="MARGIN-LEFT: 0.2in; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Deferred income tax liabilities</font></p>
                    </td>

                    <td valign="bottom" align="left" width="30">
                    </td>

                    <td valign="bottom" align="left" width="17">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">403</font></p>
                    </td>

                    <td valign="bottom" align="left" width="42">
                    </td>

                    <td valign="bottom" align="left" width="22">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">403</font></p>
                    </td>

                    <td valign="bottom" align="left" width="10">
                    </td>
                </tr>

                <tr bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="bottom" width="719">
                        <p style="MARGIN-LEFT: 0.2in; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Income taxes payable</font></p>
                    </td>

                    <td valign="bottom" align="left" width="30">
                    </td>

                    <td valign="bottom" align="left" width="17">&nbsp;</td>

                    <td style="BORDER-BOTTOM: black 1pt solid" valign="bottom" align="right" colspan="2">
                        <p><font size="2">133</font></p>
                    </td>

                    <td style="PADDING-BOTTOM: 1pt" valign="bottom" align="left" width="42">
                    </td>

                    <td valign="bottom" align="left" width="22">&nbsp;</td>

                    <td style="BORDER-BOTTOM: black 1pt solid" valign="bottom" align="right" colspan="2">
                        <p><font size="2">225</font></p>
                    </td>

                    <td style="PADDING-BOTTOM: 1pt" valign="bottom" align="left" width="10">
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="bottom" width="719">
                        <p style="MARGIN-LEFT: 0.45in; TEXT-INDENT: -5.05pt; TEXT-ALIGN: left"><font size="2">TOTAL CURRENT LIABILITIES</font></p>
                    </td>

                    <td valign="bottom" align="left" width="30">
                    </td>

                    <td valign="bottom" align="left" width="17">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">132,741</font></p>
                    </td>

                    <td valign="bottom" align="left" width="42">
                    </td>

                    <td valign="bottom" align="left" width="22">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">149,981</font></p>
                    </td>

                    <td valign="bottom" align="left" width="10">
                        <p></p>
                    </td>
                </tr>

                <tr bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="bottom" width="719">&nbsp;&nbsp;</td>

                    <td valign="bottom" align="left" width="30">
                    </td>

                    <td valign="bottom" align="left" width="17">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                    </td>

                    <td valign="bottom" align="left" width="42">
                    </td>

                    <td valign="bottom" align="left" width="22">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                    </td>

                    <td valign="bottom" align="left" width="10">
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="bottom" width="719">
                        <p style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">DEFERRED RENT &amp; OTHER LONG-TERM LIABILITIES</font></p>
                    </td>

                    <td valign="bottom" align="left" width="30">
                    </td>

                    <td valign="bottom" align="left" width="17">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">22,969</font></p>
                    </td>

                    <td valign="bottom" align="left" width="42">
                    </td>

                    <td valign="bottom" align="left" width="22">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">23,054</font></p>
                    </td>

                    <td valign="bottom" align="left" width="10">
                    </td>
                </tr>

                <tr bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="bottom" width="719">
                        <p style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">DEFERRED INCOME TAXES</font></p>
                    </td>

                    <td valign="bottom" align="left" width="30">
                    </td>

                    <td valign="bottom" align="left" width="17">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">3,539</font></p>
                    </td>

                    <td valign="bottom" align="left" width="42">
                    </td>

                    <td valign="bottom" align="left" width="22">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">3,373</font></p>
                    </td>

                    <td valign="bottom" align="left" width="10">
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="bottom" width="719">
                        <p style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">CONVERTIBLE NOTES (see Note F)</font></p>
                    </td>

                    <td valign="bottom" align="left" width="30">
                    </td>

                    <td valign="bottom" align="left" width="17">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">68,508</font></p>
                    </td>

                    <td valign="bottom" align="left" width="42">
                    </td>

                    <td valign="bottom" align="left" width="22">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">67,864</font></p>
                    </td>

                    <td valign="bottom" align="left" width="10">
                    </td>
                </tr>

                <tr bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="bottom" width="719">
                        <p style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="30">
                    </td>

                    <td valign="bottom" align="left" width="17">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="42">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="22">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="10">
                        <p>&nbsp;</p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="bottom" width="719">
                        <p style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">STOCKHOLDERS&rsquo; EQUITY</font></p>
                    </td>

                    <td valign="bottom" align="left" width="30">
                    </td>

                    <td valign="bottom" align="left" width="17">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                    </td>

                    <td valign="bottom" align="left" width="42">
                    </td>

                    <td valign="bottom" align="left" width="22">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                    </td>

                    <td valign="bottom" align="left" width="10">
                    </td>
                </tr>

                <tr bgcolor="#cceeff">
                    <td style="MARGIN-LEFT: 13.5pt; TEXT-INDENT: -3.75pt; TEXT-ALIGN: left" valign="bottom" width="719">
                        <p style="MARGIN-LEFT: 0.2in; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Common stock, $0.01 par value, shares authorized: 25,000,000; shares issued and outstanding: <font size="2">11,989,724 in&nbsp;2009 and 2008</font></font></p>
                    </td>

                    <td valign="bottom" align="left" width="30">
                    </td>

                    <td valign="bottom" align="left" width="17">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">120</font></p>
                    </td>

                    <td valign="bottom" align="left" width="42">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="22">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">120</font></p>
                    </td>

                    <td valign="bottom" align="left" width="10">
                        <p>&nbsp;</p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="bottom" width="719">
                        <p style="MARGIN-LEFT: 13.5pt; TEXT-INDENT: -3.75pt; TEXT-ALIGN: left"><font size="2">Paid-in capital</font></p>
                    </td>

                    <td valign="bottom" align="left" width="30">
                    </td>

                    <td valign="bottom" align="left" width="17">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">127,954</font></p>
                    </td>

                    <td valign="bottom" align="left" width="42">
                    </td>

                    <td valign="bottom" align="left" width="22">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">127,497</font></p>
                    </td>

                    <td valign="bottom" align="left" width="10">
                    </td>
                </tr>

                <tr bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="bottom" width="719">
                        <p style="MARGIN-LEFT: 13.5pt; TEXT-INDENT: -3.75pt; TEXT-ALIGN: left"><font size="2">Accumulated deficit</font></p>
                    </td>

                    <td valign="bottom" align="left" width="30">
                    </td>

                    <td valign="bottom" align="left" width="17">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">(27,475</font></p>
                    </td>

                    <td valign="bottom" align="left" width="42">
                        <p><font size="2">)</font></p>
                    </td>

                    <td valign="bottom" align="left" width="22">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">(21,515</font></p>
                    </td>

                    <td valign="bottom" align="left" width="10">
                        <p><font size="2">)</font></p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="bottom" width="719">
                        <p style="MARGIN-LEFT: 0pt; TEXT-INDENT: 9pt; TEXT-ALIGN: left"><font size="2">Accumulated other comprehensive loss</font></p>
                    </td>

                    <td valign="bottom" align="left" width="30">
                    </td>

                    <td valign="bottom" align="left" width="17">&nbsp;</td>

                    <td style="BORDER-BOTTOM: black 1pt solid" valign="bottom" align="right" colspan="2">
                        <p><font size="2">(9,337</font></p>
                    </td>

                    <td style="PADDING-BOTTOM: 1pt" valign="bottom" align="left" width="42">
                        <p><font size="2">)</font></p>
                    </td>

                    <td valign="bottom" align="left" width="22">&nbsp;</td>

                    <td style="BORDER-BOTTOM: black 1pt solid" valign="bottom" align="right" colspan="2">
                        <p><font size="2">(8,593</font></p>
                    </td>

                    <td style="PADDING-BOTTOM: 1pt" valign="bottom" align="left" width="10">
                        <p><font size="2">)</font></p>
                    </td>
                </tr>

                <tr bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="bottom" width="719">
                        <p style="MARGIN-LEFT: 27.35pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">TOTAL STOCKHOLDERS&rsquo; EQUITY</font></p>
                    </td>

                    <td valign="bottom" align="left" width="30">
                    </td>

                    <td valign="bottom" align="left" width="17">&nbsp;</td>

                    <td style="BORDER-BOTTOM: black 1pt solid" valign="bottom" align="right" colspan="2">
                        <p><font size="2">91,262</font></p>
                    </td>

                    <td style="PADDING-BOTTOM: 1pt" valign="bottom" align="left" width="42">
                    </td>

                    <td valign="bottom" align="left" width="22">&nbsp;</td>

                    <td style="BORDER-BOTTOM: black 1pt solid" valign="bottom" align="right" colspan="2">
                        <p><font size="2">97,509</font></p>
                    </td>

                    <td style="PADDING-BOTTOM: 1pt" valign="bottom" align="left" width="10">
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="bottom" width="719">
                        <p style="MARGIN-LEFT: 0in; TEXT-INDENT: 49.5pt; TEXT-ALIGN: left"><font size="2"><strong>TOTAL LIABILITIES AND STOCKHOLDERS&rsquo; EQUITY</strong></font></p>
                    </td>

                    <td valign="bottom" align="left" width="30">
                    </td>

                    <td valign="bottom" align="left" width="17">
                        <p>&nbsp;</p>
                    </td>

                    <td style="BORDER-BOTTOM: black 2.25pt double" valign="bottom" align="right" width="34" colspan="1">
                        <p><font size="2">$</font></p>
                    </td>

                    <td style="BORDER-BOTTOM: black 2.25pt double" valign="bottom" width="89">
                        <p align="right"><font size="2">319,019</font></p>
                    </td>

                    <td style="PADDING-BOTTOM: 2.25pt" valign="bottom" align="left" width="42">
                    </td>

                    <td valign="bottom" align="left" width="22">
                        <p>&nbsp;</p>
                    </td>

                    <td style="BORDER-BOTTOM: black 2.25pt double" valign="bottom" align="right" width="40" colspan="1">
                        <p><font size="2">$</font></p>
                    </td>

                    <td style="BORDER-BOTTOM: black 2.25pt double" valign="bottom" width="57">
                        <p align="right"><font size="2">341,781</font></p>
                    </td>

                    <td style="PADDING-BOTTOM: 2.25pt" valign="bottom" align="left" width="10">
                    </td>
                </tr>

                <tr bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="bottom" width="719">
                        <p style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="30">
                    </td>

                    <td valign="bottom" align="left" width="17">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="42">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="22">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="10">
                        <p>&nbsp;</p>
                    </td>
                </tr>
            </table>
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><font size="2">See accompanying independent registered public accounting firm review report and notes to unaudited condensed consolidated financial statements.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center">&nbsp;</p>

        <div title="EE+ Page Footer">
            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"></p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><font size="2">-2-</font></p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"></p>
        </div>

        <div title="EE+ Page Break" style="FONT-SIZE: 1pt; PAGE-BREAK-AFTER: always; WIDTH: 100%; HEIGHT: 1px">
            <hr align="center" width="100%" noshade size="2">
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><b><font size="2">LIFETIME BRANDS, INC.</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><b><font size="2">CONDENSED CONSOLIDATED <a name="stmtoperations">STATEMENTS OF OPERATIONS</a></font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><font size="2">(In thousands, except per share data)</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><font size="2">(unaudited)</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <div align="center">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="80%" border="0">
                <tr style="page-break-inside: avoid">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="595">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="15">
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="top" colspan="7">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">Three Months Ended</font></b></p>

                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">March 31,</font></b></p>
                    </td>

                    <td valign="bottom" align="left" width="33">
                    </td>
                </tr>

                <tr style="page-break-inside: avoid">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="595">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 0.2in; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="15">
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="top" colspan="3">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">2009</font></b></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td style="BORDER-RIGHT: medium none; PADDING-RIGHT: 5.4pt; BORDER-TOP: black 1pt solid; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="top" colspan="3">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">2008</font></b></p>
                    </td>

                    <td valign="bottom" align="left" width="33">
                    </td>
                </tr>

                <tr style="page-break-inside: avoid" bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="top" width="595">
                        <p style="MARGIN-LEFT: 0.2in; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="15">
                    </td>

                    <td valign="bottom" align="left" width="17">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p align="center"><font size="2">(as adjusted<br>
                        see Note F)</font></p>
                    </td>

                    <td valign="bottom" align="left" width="33">
                    </td>
                </tr>

                <tr style="page-break-inside: avoid">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="top" width="595">
                        <p style="MARGIN-LEFT: 0.2in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="15">
                    </td>

                    <td valign="bottom" align="left" width="17">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="33">
                        <p>&nbsp;</p>
                    </td>
                </tr>

                <tr style="page-break-inside: avoid" bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="top" width="595">
                        <p style="MARGIN-LEFT: 0.2in; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Net sales</font></p>
                    </td>

                    <td valign="bottom" align="left" width="15">
                    </td>

                    <td valign="bottom" align="left" width="17">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="right" width="97">
                        <p><font size="2">$</font></p>
                    </td>

                    <td valign="bottom" width="35">
                        <p align="right"><font size="2">90,214</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="right" width="97">
                        <p><font size="2">$</font></p>
                    </td>

                    <td valign="bottom" width="38">
                        <p align="right"><font size="2">98,194</font></p>
                    </td>

                    <td valign="bottom" align="left" width="33">
                    </td>
                </tr>

                <tr style="page-break-inside: avoid">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="top" width="595">
                        <p style="MARGIN-LEFT: 0.2in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="15">
                    </td>

                    <td valign="bottom" align="left" width="17">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="33">
                        <p>&nbsp;</p>
                    </td>
                </tr>

                <tr style="page-break-inside: avoid" bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="top" width="595">
                        <p style="MARGIN-LEFT: 0.2in; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Cost of sales</font></p>
                    </td>

                    <td valign="bottom" align="left" width="15">
                    </td>

                    <td valign="bottom" align="left" width="17">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">58,148</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">59,605</font></p>
                    </td>

                    <td valign="bottom" align="left" width="33">
                    </td>
                </tr>

                <tr style="page-break-inside: avoid">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="top" width="595">
                        <p style="MARGIN-LEFT: 0.2in; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Distribution expenses</font></p>
                    </td>

                    <td valign="bottom" align="left" width="15">
                    </td>

                    <td valign="bottom" align="left" width="17">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">11,048</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">13,390</font></p>
                    </td>

                    <td valign="bottom" align="left" width="33">
                    </td>
                </tr>

                <tr style="page-break-inside: avoid" bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="top" width="595">
                        <p style="MARGIN-LEFT: 0.2in; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Selling, general and administrative expenses</font></p>
                    </td>

                    <td valign="bottom" align="left" width="15">
                    </td>

                    <td valign="bottom" align="left" width="17">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">23,567</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">31,103</font></p>
                    </td>

                    <td valign="bottom" align="left" width="33">
                    </td>
                </tr>

                <tr style="page-break-inside: avoid">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="top" width="595">
                        <p style="MARGIN-LEFT: 0.2in; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Restructuring expenses</font></p>
                    </td>

                    <td valign="bottom" align="left" width="15">
                    </td>

                    <td style="BORDER-BOTTOM: black 1px solid" valign="bottom" align="left" width="17">&nbsp;</td>

                    <td style="BORDER-BOTTOM: black 1pt solid" valign="bottom" align="right" colspan="2">
                        <p><font size="2">824</font></p>
                    </td>

                    <td style="PADDING-BOTTOM: 1pt" valign="bottom" align="left" width="16">
                    </td>

                    <td style="BORDER-BOTTOM: black 1px solid" valign="bottom" align="left" width="16">&nbsp;</td>

                    <td style="BORDER-BOTTOM: black 1pt solid" valign="bottom" align="right" colspan="2">
                        <p><font size="2">2,880</font></p>
                    </td>

                    <td style="PADDING-BOTTOM: 1pt" valign="bottom" align="left" width="33">
                    </td>
                </tr>

                <tr style="page-break-inside: avoid" bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="top" width="595">
                        <p style="MARGIN-LEFT: 0.2in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="15">
                    </td>

                    <td valign="bottom" align="left" width="17">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="33">
                        <p>&nbsp;</p>
                    </td>
                </tr>

                <tr style="page-break-inside: avoid">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="top" width="595">
                        <p style="MARGIN-LEFT: 0.2in; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Loss from operations</font></p>
                    </td>

                    <td valign="bottom" align="left" width="15">
                    </td>

                    <td valign="bottom" align="left" width="17">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">(3,373</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p><font size="2">)</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">(8,784</font></p>
                    </td>

                    <td valign="bottom" align="left" width="33">
                        <p><font size="2">)</font></p>
                    </td>
                </tr>

                <tr style="page-break-inside: avoid" bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="top" width="595">
                        <p style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="15">
                    </td>

                    <td valign="bottom" align="left" width="17">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="33">
                        <p>&nbsp;</p>
                    </td>
                </tr>

                <tr style="page-break-inside: avoid">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="top" width="595">
                        <p style="MARGIN-LEFT: 0.2in; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Interest expense (see Note F)</font></p>
                    </td>

                    <td valign="bottom" align="left" width="15">
                    </td>

                    <td style="BORDER-BOTTOM: black 1px solid" valign="bottom" align="left" width="17">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">(2,873</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p><font size="2">) </font></p>
                    </td>

                    <td style="BORDER-BOTTOM: black 1px solid" valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">(2,681</font></p>
                    </td>

                    <td valign="bottom" align="left" width="33">
                        <p><font size="2">)</font></p>
                    </td>
                </tr>

                <tr style="page-break-inside: avoid" bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="top" width="595">
                        <p style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="15">
                    </td>

                    <td valign="bottom" align="left" width="17">
                        <p>&nbsp;</p>
                    </td>

                    <td style="BORDER-TOP: black 1pt solid" valign="bottom" align="right" colspan="2">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p>&nbsp;</p>
                    </td>

                    <td style="BORDER-TOP: black 1pt solid" valign="bottom" align="right" colspan="2">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="33">
                        <p>&nbsp;</p>
                    </td>
                </tr>

                <tr style="page-break-inside: avoid">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="top" width="595">
                        <p style="MARGIN-LEFT: 0.3in; TEXT-INDENT: -9pt; TEXT-ALIGN: left"><font size="2">Loss before income taxes and equity in earnings of Grupo Vasconia, S.A.B.</font></p>
                    </td>

                    <td valign="bottom" align="left" width="15">
                    </td>

                    <td valign="bottom" align="left" width="17">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">(6,246</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p><font size="2">)</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">(11,465</font></p>
                    </td>

                    <td valign="bottom" align="left" width="33">
                        <p><font size="2">)</font></p>
                    </td>
                </tr>

                <tr style="page-break-inside: avoid" bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="top" width="595">
                        <p style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="15">
                    </td>

                    <td valign="bottom" align="left" width="17">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="33">
                        <p>&nbsp;</p>
                    </td>
                </tr>

                <tr style="page-break-inside: avoid">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="top" width="595">
                        <p style="MARGIN-LEFT: 0.2in; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Income tax benefit (provision) (see Note J)</font></p>
                    </td>

                    <td valign="bottom" align="left" width="15">
                    </td>

                    <td valign="bottom" align="left" width="17">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">(135</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p><font size="2">) </font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">4,851</font></p>
                    </td>

                    <td valign="bottom" align="left" width="33">
                    </td>
                </tr>

                <tr style="page-break-inside: avoid" bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="top" width="595">
                        <p style="MARGIN-LEFT: 0.3in; TEXT-INDENT: -9pt; TEXT-ALIGN: left"><font size="2">Equity in earnings of Grupo Vasconia, S.A.B., net of taxes </font></p>
                    </td>

                    <td valign="bottom" align="left" width="15">
                    </td>

                    <td style="BORDER-BOTTOM: black 1px solid" valign="bottom" align="left" width="17">&nbsp;</td>

                    <td style="BORDER-BOTTOM: black 1pt solid" valign="bottom" align="right" colspan="2">
                        <p><font size="2">422</font></p>
                    </td>

                    <td style="PADDING-BOTTOM: 1pt" valign="bottom" align="left" width="16">
                    </td>

                    <td style="BORDER-BOTTOM: black 1pt solid" valign="bottom" align="left" width="16">&nbsp;</td>

                    <td style="BORDER-BOTTOM: black 1pt solid" valign="bottom" align="right" colspan="2">
                        <p><font size="2">257</font></p>
                    </td>

                    <td style="PADDING-BOTTOM: 1pt" valign="bottom" align="left" width="33">
                    </td>
                </tr>

                <tr style="page-break-inside: avoid">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="top" width="595">
                        <p style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="15">
                    </td>

                    <td valign="bottom" align="left" width="17">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="33">
                        <p>&nbsp;</p>
                    </td>
                </tr>

                <tr style="page-break-inside: avoid" bgcolor="#cceeff" height="17">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="top" width="595">
                        <p style="MARGIN-LEFT: 0.2in; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><b><font size="2">NET LOSS</font></b></p>
                    </td>

                    <td valign="bottom" align="left" width="15">
                    </td>

                    <td style="BORDER-BOTTOM: black 2.25pt double" valign="bottom" align="left" width="17">
                        <p>&nbsp;</p>
                    </td>

                    <td style="BORDER-BOTTOM: black 2.25pt double" valign="bottom" align="right" width="97" colspan="1">
                        <p><font size="2">$&nbsp;</font></p>
                    </td>

                    <td style="BORDER-BOTTOM: black 2.25pt double" valign="bottom" width="35">
                        <p align="right"><font size="2">&nbsp;(5,959</font></p>
                    </td>

                    <td style="PADDING-BOTTOM: 2.25pt" valign="bottom" align="left" width="16">
                        <p><font size="2">) </font></p>
                    </td>

                    <td style="BORDER-BOTTOM: black 2.25pt double" valign="bottom" align="left" width="16">
                        <p>&nbsp;</p>
                    </td>

                    <td style="BORDER-BOTTOM: black 2.25pt double" valign="bottom" align="right" width="97" colspan="1">
                        <p><font size="2">$</font></p>
                    </td>

                    <td style="BORDER-BOTTOM: black 2.25pt double" valign="bottom" width="38">
                        <p align="right"><font size="2">(6,357</font></p>
                    </td>

                    <td style="PADDING-BOTTOM: 2.25pt" valign="bottom" align="left" width="33"><font size="2">)</font></td>
                </tr>

                <tr style="page-break-inside: avoid">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="bottom" width="595">
                        <p style="MARGIN-LEFT: 30.6pt; TEXT-INDENT: -0.25in; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="15">
                    </td>

                    <td valign="bottom" align="left" width="17">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="33">
                        <p>&nbsp;</p>
                    </td>
                </tr>

                <tr style="page-break-inside: avoid" bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="bottom" width="595">
                        <p style="MARGIN-LEFT: 30.6pt; TEXT-INDENT: -0.25in; TEXT-ALIGN: left"><b><font size="2">BASIC AND DILUTED LOSS PER COMMON SHARE</font></b></p>
                    </td>

                    <td valign="bottom" align="left" width="15">
                    </td>

                    <td style="BORDER-BOTTOM: black 2.25pt double" valign="bottom" align="left" width="17">
                        <p>&nbsp;</p>
                    </td>

                    <td style="BORDER-BOTTOM: black 2.25pt double" valign="bottom" align="right" width="97" colspan="1">
                        <p><font size="2">$&nbsp;</font></p>
                    </td>

                    <td style="BORDER-BOTTOM: black 2.25pt double" valign="bottom" width="35">
                        <p align="right"><font size="2">&nbsp;(0.50</font></p>
                    </td>

                    <td style="PADDING-BOTTOM: 2.25pt" valign="bottom" align="left" width="16"><font size="2">)</font></td>

                    <td style="BORDER-BOTTOM: black 2.25pt double" valign="bottom" align="left" width="16">
                        <p>&nbsp;</p>
                    </td>

                    <td style="BORDER-BOTTOM: black 2.25pt double" valign="bottom" align="right" width="97" colspan="1">
                        <p><font size="2">$</font></p>
                    </td>

                    <td style="BORDER-BOTTOM: black 2.25pt double" valign="bottom" width="38">
                        <p align="right"><font size="2">&nbsp;(0.53</font></p>
                    </td>

                    <td style="PADDING-BOTTOM: 2.25pt" valign="bottom" align="left" width="33"><font size="2">)</font></td>
                </tr>
            </table>
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><font size="2">See accompanying independent registered public accounting firm review report and notes to unaudited condensed consolidated financial statements.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <div title="EE+ Page Footer">
            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"></p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><font size="2">-3-</font></p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"></p>
        </div>

        <div title="EE+ Page Break" style="FONT-SIZE: 1pt; PAGE-BREAK-AFTER: always; WIDTH: 100%; HEIGHT: 1px">
            <hr align="center" width="100%" noshade size="2">
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><b><font size="2">LIFETIME BRANDS, INC.</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><b><font size="2">CONDENSED CONSOLIDATED <a name="stmtcashflows">STATEMENTS OF CASH FLOWS</a></font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><font size="2">(In thousands)</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><font size="2">(unaudited)</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center">&nbsp;</p>

        <div align="center">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="90%" border="0">
                <tr style="page-break-inside: avoid">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" colspan="7">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 30.95pt; TEXT-INDENT: -30.95pt; TEXT-ALIGN: center"><b><font size="2">Three Months Ended </font></b></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>
                </tr>

                <tr style="page-break-inside: avoid">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="top" colspan="7">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 30.95pt; TEXT-INDENT: -30.95pt; TEXT-ALIGN: center"><b><font size="2">March 31,</font></b></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>
                </tr>

                <tr style="page-break-inside: avoid">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="top" colspan="3">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">2009</font></b></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td style="BORDER-RIGHT: medium none; PADDING-RIGHT: 5.4pt; BORDER-TOP: black 1pt solid; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="top" colspan="3">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">2008</font></b></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>
                </tr>

                <tr style="page-break-inside: avoid">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" colspan="3">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" colspan="3">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font size="2">(as adjusted <br>
                        see Note F)</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>
                </tr>

                <tr style="page-break-inside: avoid" bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="top">
                        <p style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><b><font size="2">OPERATING ACTIVITIES</font></b></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="right" width="122" colspan="2">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="37">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p>&nbsp;</p>
                    </td>
                </tr>

                <tr style="page-break-inside: avoid">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="top">
                        <p style="MARGIN-LEFT: 0.2in; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Net loss</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="right" width="88">
                        <p><font size="2">$</font></p>
                    </td>

                    <td valign="bottom" width="34">
                        <p align="right"><font size="2">(5,959</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p><font size="2">)</font></p>
                    </td>

                    <td valign="bottom" align="left" width="37">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="right" width="75">
                        <p><font size="2">$</font></p>
                    </td>

                    <td valign="bottom" width="32">
                        <p align="right"><font size="2">(6,357</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p><font size="2">)</font></p>
                    </td>
                </tr>

                <tr style="page-break-inside: avoid" bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="top">
                        <p style="MARGIN-LEFT: 13.5pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Adjustments to reconcile net loss to net cash </font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="right" width="122" colspan="2">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="37">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p>&nbsp;</p>
                    </td>
                </tr>

                <tr style="page-break-inside: avoid">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="top">
                        <p style="MARGIN-LEFT: 22.5pt; TEXT-INDENT: 6.75pt; TEXT-ALIGN: left"><font size="2">provided by (used in) operating activities:</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="right" width="122" colspan="2">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="37">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p>&nbsp;</p>
                    </td>
                </tr>

                <tr style="page-break-inside: avoid" bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="top">
                        <p style="MARGIN-LEFT: 0.2in; TEXT-INDENT: 7.5pt; TEXT-ALIGN: left"><font size="2">Depreciation and amortization</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="right" width="122" colspan="2">
                        <p><font size="2">2,678</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="left" width="37">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">2,630</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>
                </tr>

                <tr style="page-break-inside: avoid">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="top">
                        <p style="MARGIN-LEFT: 0.2in; TEXT-INDENT: 6.75pt; TEXT-ALIGN: left"><font size="2">Amortization of debt discount</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="right" width="122" colspan="2">
                        <p><font size="2">644</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="left" width="37">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">588</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>
                </tr>

                <tr style="page-break-inside: avoid" bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="top">
                        <p style="MARGIN-LEFT: 0.2in; TEXT-INDENT: 7.5pt; TEXT-ALIGN: left"><font size="2">Deferred rent</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="right" width="122" colspan="2">
                        <p><font size="2">78</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="left" width="37">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">1,040</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>
                </tr>

                <tr style="page-break-inside: avoid">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="top">
                        <p style="MARGIN-LEFT: 0.2in; TEXT-INDENT: 7.5pt; TEXT-ALIGN: left"><font size="2">Deferred income taxes</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="right" width="122" colspan="2">
                        <p><font size="2">60</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p></p>
                    </td>

                    <td valign="bottom" align="left" width="37">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">(228</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p><font size="2">)</font></p>
                    </td>
                </tr>

                <tr style="page-break-inside: avoid" bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="top">
                        <p style="MARGIN-LEFT: 30.6pt; TEXT-INDENT: -9pt; TEXT-ALIGN: left"><font size="2">Stock compensation expense</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="right" width="122" colspan="2">
                        <p><font size="2">459</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="left" width="37">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">640</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>
                </tr>

                <tr style="page-break-inside: avoid" height="17">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="top">
                        <p style="MARGIN-LEFT: 30.6pt; TEXT-INDENT: -9pt; TEXT-ALIGN: left"><font size="2">Undistributed earnings of Grupo Vasconia, S.A.B.</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="right" width="122" colspan="2">
                        <p><font size="2">(422</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p><font size="2">)</font></p>
                    </td>

                    <td valign="bottom" align="left" width="37">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">(257</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p><font size="2">)</font></p>
                    </td>
                </tr>

                <tr style="page-break-inside: avoid" bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="top">
                        <p style="MARGIN-LEFT: 30.6pt; TEXT-INDENT: -17.1pt; TEXT-ALIGN: left"><font size="2">Changes in operating assets and liabilities:</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="right" width="122" colspan="2">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="37">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p>&nbsp;</p>
                    </td>
                </tr>

                <tr style="page-break-inside: avoid">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="top">
                        <p style="MARGIN-LEFT: 0.3in; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Accounts receivable, net</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="right" width="122" colspan="2">
                        <p><font size="2">7,685</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="left" width="37">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">13,521</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>
                </tr>

                <tr style="page-break-inside: avoid" bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="top">
                        <p style="MARGIN-LEFT: 0.3in; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Inventory</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="right" width="122" colspan="2">
                        <p><font size="2">9,670</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p></p>
                    </td>

                    <td valign="bottom" align="left" width="37">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">6,827</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>
                </tr>

                <tr style="page-break-inside: avoid">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="top">
                        <p style="MARGIN-LEFT: 26.1pt; TEXT-INDENT: -4.5pt; TEXT-ALIGN: left"><font size="2">Prepaid expenses, other current assets and other assets </font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="right" width="122" colspan="2">
                        <p><font size="2">1,638</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p></p>
                    </td>

                    <td valign="bottom" align="left" width="37">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">1,753</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p></p>
                    </td>
                </tr>

                <tr style="page-break-inside: avoid" bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="top">
                        <p style="MARGIN-LEFT: 30.6pt; TEXT-INDENT: -9pt; TEXT-ALIGN: left"><font size="2">Accounts payable, accrued expenses and other liabilities</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="right" width="122" colspan="2">
                        <p><font size="2">(7,528</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p><font size="2">) </font></p>
                    </td>

                    <td valign="bottom" align="left" width="37">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">(17,145</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p><font size="2">)</font></p>
                    </td>
                </tr>

                <tr style="page-break-inside: avoid">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="top">
                        <p style="MARGIN-LEFT: 0.3in; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Prepaid income taxes</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="right" width="122" colspan="2">
                        <p><font size="2">&#8213;</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="left" width="37">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">(3,791</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p><font size="2">)</font></p>
                    </td>
                </tr>

                <tr style="page-break-inside: avoid" bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="top">
                        <p style="MARGIN-LEFT: 0.3in; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Income taxes payable</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="left" width="16">&nbsp;</td>

                    <td style="BORDER-BOTTOM: black 1pt solid" valign="bottom" align="right" width="122" colspan="2">
                        <p><font size="2">(92</font></p>
                    </td>

                    <td style="PADDING-BOTTOM: 1pt" valign="bottom" align="left" width="16">
                        <p><font size="2">) </font></p>
                    </td>

                    <td valign="bottom" align="left" width="37">&nbsp;</td>

                    <td style="BORDER-BOTTOM: black 1pt solid" valign="bottom" align="right" colspan="2">
                        <p><font size="2">(4,520</font></p>
                    </td>

                    <td style="PADDING-BOTTOM: 1pt" valign="bottom" align="left" width="16">
                        <p><font size="2">)</font></p>
                    </td>
                </tr>

                <tr style="page-break-inside: avoid">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="top">
                        <p style="MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; TEXT-ALIGN: left"><b><font size="2">NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES</font></b></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="left" width="16">&nbsp;</td>

                    <td style="BORDER-BOTTOM: black 1pt solid" valign="bottom" align="right" width="122" colspan="2">
                        <p><font size="2">8,911</font></p>
                    </td>

                    <td style="PADDING-BOTTOM: 1pt" valign="bottom" align="left" width="16">
                        <p></p>
                    </td>

                    <td valign="bottom" align="left" width="37">&nbsp;</td>

                    <td style="BORDER-BOTTOM: black 1pt solid" valign="bottom" align="right" colspan="2">
                        <p><font size="2">(5,299</font></p>
                    </td>

                    <td style="PADDING-BOTTOM: 1pt" valign="bottom" align="left" width="16">
                        <p><font size="2">)</font></p>
                    </td>
                </tr>

                <tr style="page-break-inside: avoid" bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="top">
                        <p style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="right" width="122" colspan="2">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="37">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p>&nbsp;</p>
                    </td>
                </tr>

                <tr style="page-break-inside: avoid">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="top">
                        <p style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><b><font size="2">INVESTING ACTIVITIES</font></b></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="right" width="122" colspan="2">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="37">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p>&nbsp;</p>
                    </td>
                </tr>

                <tr style="page-break-inside: avoid" bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="top">
                        <p style="MARGIN-LEFT: 0.2in; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Purchases of property and equipment, net</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="right" width="122" colspan="2">
                        <p><font size="2">(679</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p><font size="2">) </font></p>
                    </td>

                    <td valign="bottom" align="left" width="37">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">(2,683</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p><font size="2">)</font></p>
                    </td>
                </tr>

                <tr style="page-break-inside: avoid">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="top">
                        <p style="MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; TEXT-ALIGN: left"><b><font size="2">NET CASH USED IN INVESTING ACTIVITIES</font></b></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td style="BORDER-TOP: black 1pt solid" valign="bottom" align="right" width="122" colspan="2">
                        <p><font size="2">(679</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p><font size="2">) </font></p>
                    </td>

                    <td valign="bottom" align="left" width="37">
                    </td>

                    <td style="BORDER-TOP: black 1pt solid" valign="bottom" align="right" colspan="2">
                        <p><font size="2">(2,683</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p><font size="2">)</font></p>
                    </td>
                </tr>

                <tr style="page-break-inside: avoid" bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="top">
                        <p style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="right" width="122" colspan="2">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="37">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p>&nbsp;</p>
                    </td>
                </tr>

                <tr style="page-break-inside: avoid">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="top">
                        <p style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><b><font size="2">FINANCING ACTIVITIES</font></b></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="right" width="122" colspan="2">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="37">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p>&nbsp;</p>
                    </td>
                </tr>

                <tr style="page-break-inside: avoid" bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="bottom">
                        <p style="MARGIN-LEFT: 0.2in; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Proceeds (repayments) of borrowings, net</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="right" width="122" colspan="2">
                        <p><font size="2">(9,600</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p><font size="2">)</font></p>
                    </td>

                    <td valign="bottom" align="left" width="37">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">5,200</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>
                </tr>

                <tr style="page-break-inside: avoid">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="bottom">
                        <p style="MARGIN-LEFT: 0.2in; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Proceeds from exercise of stock options</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="right" width="122" colspan="2">
                        <p><font size="2">&#8213;</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="left" width="37">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">8</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>
                </tr>

                <tr style="page-break-inside: avoid" bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="bottom">
                        <p style="MARGIN-LEFT: 0.2in; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Payment of capital lease obligations</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="right" width="122" colspan="2">
                        <p><font size="2">(62</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p><font size="2">) </font></p>
                    </td>

                    <td valign="bottom" align="left" width="37">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">(116</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p><font size="2">)</font></p>
                    </td>
                </tr>

                <tr style="page-break-inside: avoid">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="top">
                        <p style="MARGIN-LEFT: 0.2in; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Cash dividends paid</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="right" width="122" colspan="2">
                        <p><font size="2">&#8213;</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="left" width="37">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">(749</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p><font size="2">)</font></p>
                    </td>
                </tr>

                <tr style="page-break-inside: avoid" bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="bottom">
                        <p style="MARGIN-LEFT: 0in; TEXT-INDENT: 24.75pt; TEXT-ALIGN: left"><b><font size="2">NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES</font></b></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="left" width="16">&nbsp;</td>

                    <td style="BORDER-RIGHT: medium none; BORDER-TOP: black 1pt solid; BORDER-LEFT: medium none; BORDER-BOTTOM: black 1pt solid" valign="bottom" align="right" width="122" colspan="2">
                        <p><font size="2">(9,662</font></p>
                    </td>

                    <td style="PADDING-BOTTOM: 1pt" valign="bottom" align="left" width="16">
                        <p><font size="2">)</font></p>
                    </td>

                    <td valign="bottom" align="left" width="37">&nbsp;</td>

                    <td style="BORDER-RIGHT: medium none; BORDER-TOP: black 1pt solid; BORDER-LEFT: medium none; BORDER-BOTTOM: black 1pt solid" valign="bottom" align="right" colspan="2">
                        <p><font size="2">4,343</font></p>
                    </td>

                    <td style="PADDING-BOTTOM: 1pt" valign="bottom" align="left" width="16">
                    </td>
                </tr>

                <tr style="page-break-inside: avoid">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="top">
                        <p style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="right" width="122" colspan="2">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="37">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p>&nbsp;</p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p>&nbsp;</p>
                    </td>
                </tr>

                <tr style="page-break-inside: avoid" bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="top">
                        <p style="MARGIN-LEFT: 23.4pt; TEXT-INDENT: -23.4pt; TEXT-ALIGN: left"><b><font size="2">DECREASE IN CASH AND CASH EQUIVALENTS</font></b></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="right" width="122" colspan="2">
                        <p><font size="2">(1,430</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p><font size="2">)</font></p>
                    </td>

                    <td valign="bottom" align="left" width="37">
                    </td>

                    <td valign="bottom" align="right" colspan="2">
                        <p><font size="2">(3,639</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p><font size="2">)</font></p>
                    </td>
                </tr>

                <tr style="page-break-inside: avoid">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="top">
                        <p style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Cash and cash equivalents at beginning of period</font></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="left" width="16">&nbsp;</td>

                    <td style="BORDER-BOTTOM: black 1pt solid" valign="bottom" align="right" width="122" colspan="2">
                        <p><font size="2">3,478</font></p>
                    </td>

                    <td style="PADDING-BOTTOM: 1pt" valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="left" width="37">&nbsp;</td>

                    <td style="BORDER-BOTTOM: black 1pt solid" valign="bottom" align="right" colspan="2">
                        <p><font size="2">4,172</font></p>
                    </td>

                    <td style="PADDING-BOTTOM: 1pt" valign="bottom" align="left" width="16">
                    </td>
                </tr>

                <tr style="page-break-inside: avoid" bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt" valign="top">
                        <p style="MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><b><font size="2">CASH AND CASH EQUIVALENTS AT END OF PERIOD</font></b></p>
                    </td>

                    <td valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="left" width="16">
                        <p>&nbsp;</p>
                    </td>

                    <td style="BORDER-BOTTOM: black 2.25pt double" valign="bottom" align="right" width="88" colspan="1">
                        <p><font size="2">$</font></p>
                    </td>

                    <td style="BORDER-BOTTOM: black 2.25pt double" width="34">
                        <p align="right"><font size="2">2,048 </font></p>
                    </td>

                    <td style="PADDING-BOTTOM: 2.25pt" valign="bottom" align="left" width="16">
                    </td>

                    <td valign="bottom" align="left" width="37">
                        <p>&nbsp;</p>
                    </td>

                    <td style="BORDER-BOTTOM: black 2.25pt double" valign="bottom" align="right" width="75" colspan="1">
                        <p><font size="2">$&nbsp;</font></p>
                    </td>

                    <td style="BORDER-BOTTOM: black 2.25pt double" width="32">
                        <p align="right"><font size="2">533</font></p>
                    </td>

                    <td style="PADDING-BOTTOM: 2.25pt" valign="bottom" align="left" width="16">
                    </td>
                </tr>
            </table>
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><font size="2">See accompanying independent registered public accounting firm review report and notes to unaudited condensed consolidated financial statements.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center">&nbsp;</p>

        <div title="EE+ Page Footer">
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            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><font size="2">-4-</font></p>

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            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

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        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><b><font size="2">LIFETIME BRANDS, INC. </font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><b><font size="2"><a name="notes"><b><font size="2">NOTES</font></b></a> TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS </font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><b><font size="2">March 31, 2009</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><font size="2">(unaudited)</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><b><font size="2">NOTE A &mdash; BASIS OF PRESENTATION AND SUMMARY ACCOUNTING POLICIES</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><b><font size="2">Organization and business</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">Lifetime Brands, Inc. (the &ldquo;Company&rdquo;) designs, markets and distributes a broad range of consumer products used in the home, including food preparation, tabletop and home d&eacute;cor products and markets its products under a number of brand names and trademarks, which are either owned or licensed. The Company sells its products wholesale to retailers throughout North America and directly to
        the consumer through its Pfaltzgraff&reg; and Mikasa&reg; Internet websites and Pfaltzgraff&reg; mail order catalogs.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><b><font size="2">Basis of presentation </font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. generally accepted accounting principles for complete
        financial statements. In the opinion of management, all adjustments, consisting only of normal recurring accruals, considered necessary for a fair presentation have been included. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and footnotes thereto included in the Company&rsquo;s Annual Report on Form 10-K for the year ended December 31, 2008. Operating results for the three-month period ended March 31, 2009 are
        not necessarily indicative of the results that may be expected for the year ending December 31, 2009. </font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">The Company&rsquo;s business and working capital needs are highly seasonal, with a majority of sales occurring in the third and fourth quarters. In 2008, 2007 and 2006, net sales for the third and fourth quarters accounted for 61%, 61%, and 65% of total annual net sales, respectively. In anticipation of the pre-holiday shipping season, inventory levels increase primarily in the June through October time
        period.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><b><font size="2">Revenue recognition</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">Wholesale sales are recognized when title of merchandise passes and the risks and rewards of ownership have transferred to the customer. Internet and Catalog sales are recognized upon receipt by the customer. The retail store sales in 2008 were recognized at the time of sale. Shipping and handling fees that are billed to customers in sales transactions are included in net sales and amounted to $900,000
        and $1.1 million for the three months ended March 31, 2009 and 2008, respectively. Net sales exclude taxes that are collected from customers and remitted to the taxing authorities.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><b><font size="2">Distribution expenses</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">Distribution expenses consist primarily of warehousing expenses, handling costs of products sold and freight-out expenses. Freight-out expenses amounted to $1.5 million and $1.6 million for the three months ended March 31, 2009 and 2008, respectively.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

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            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><font size="2">-5-</font></p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

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        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><b><font size="2">LIFETIME BRANDS, INC.</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><b><font size="2">NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS </font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><b><font size="2">March 31, 2009</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><font size="2">(unaudited)</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><b><font size="2">NOTE A &mdash; BASIS OF PRESENTATION AND SUMMARY ACCOUNTING POLICIES (continued)</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><b><font size="2">Inventory</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">Inventory consists principally of finished goods sourced from third-party suppliers. Inventory also includes finished goods, work in process and raw materials related to the Company&rsquo;s manufacture of sterling silver products. Inventory is priced by the lower of cost (first-in, first-out basis) or market method. Consistent with the seasonality of the Company&rsquo;s business, inventory generally
        increases, beginning late in the second quarter of the year, and reaches a peak at the end of the third quarter or early in the fourth quarter, and declines thereafter. The Company periodically reviews and analyzes inventory based on a number of factors including, but not limited to, future product demand for items and estimated profitability of merchandise. When appropriate, the Company writes down inventory to net realizable value. </font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><font size="2">The components of inventory are as follows:</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <div align="left">
            <table style="MARGIN-LEFT: 5.4pt; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="50%" border="0">
                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="46%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="29">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="131">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">March 31, </font></b></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="12">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="132">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">December 31,</font></b></p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="46%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="29">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="bottom" width="131">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">2009</font></b></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="12">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="bottom" width="132">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">2008</font></b></p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="46%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="29">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" colspan="3">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font size="2">(in thousands)</font></p>
                    </td>
                </tr>

                <tr bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="46%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Finished goods</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="29">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="131">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">$127,706</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="12">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="132">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">$137,378</font></p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="46%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Work in process</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="29">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="131">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">2,561</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="12">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="132">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">2,197</font></p>
                    </td>
                </tr>

                <tr bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="46%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Raw materials</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="29">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="bottom" width="131">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">1,675</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="12">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="bottom" width="132">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">2,037</font></p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="46%">
                        <p style="MARGIN-TOP: 1.5pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 17.95pt; TEXT-ALIGN: left"><font size="2">Total</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="29">
                        <p style="MARGIN-TOP: 1.5pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 2.25pt double" valign="bottom" width="131">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">$131,942</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="12">
                        <p style="MARGIN-TOP: 1.5pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 2.25pt double" valign="bottom" width="132">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">$141,612</font></p>
                    </td>
                </tr>
            </table>
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><b><font size="2">Derivatives</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">The Company accounts for derivative instruments in accordance with Statement of Financial Accounting Standards (&ldquo;SFAS&rdquo;) No. 133, </font><i><font size="2">Accounting for Derivative Instruments and Hedging Activities</font></i><font size="2">, and subsequent amendments (&ldquo;SFAS 133&rdquo;). SFAS No. 133 requires that all derivative instruments be recognized on the balance sheet at fair value
        as either an asset or a liability. Changes in the fair value of derivatives that qualify as hedges and have been designated as part of a hedging relationship for accounting purposes have no net impact on earnings to the extent the derivative is considered perfectly effective in achieving offsetting changes in fair value or cash flows attributable to the risk being hedged, until the hedged item is recognized in earnings. For derivatives that do not qualify or are not designated as
        hedging instruments for accounting purposes, changes in fair value are recorded in operations.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><b><font size="2">Fair value measurements</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">In September 2006, the Financial Accounting Standards Board (&ldquo;FASB&rdquo;) issued SFAS No. 157, </font><i><font size="2">Fair Value Measurements</font></i><font size="2">, which provides enhanced guidance for using fair value to measure assets and liabilities. SFAS No. 157 establishes a common definition of fair value, provides a framework for measuring fair value under U.S. generally accepted
        accounting principles and expands disclosure requirements about fair value measurements. In February 2008, the FASB issued FASB Staff Position (&ldquo;FSP&rdquo;) 157-1, </font><i><font size="2">Application of FASB Statement No. 157 to FASB Statement No. 13 and Other Accounting Pronouncements That Address Fair Value Measurements for Purposes of Lease Classification or Measurement under Statement 13</font></i><font size="2">, and FSP 157-2, </font><i><font size="2">Effective Date of FASB
        Statement No. 157</font></i><font size="2">. FSP 157-1 amends SFAS No. 157 to remove certain leasing transactions from its scope. FSP 157-2 delayed the effective date of SFAS No. 157 for all nonfinancial assets and liabilities, except those that are recognized or disclosed at fair value in the financial statements on at least an annual basis, until January 1, 2009. The Company adopted SFAS No. 157, except as it applies to nonfinancial assets and liabilities as noted in FSP 157-2, on
        January 1, 2008. Fair value measurements included in the Company&rsquo;s condensed consolidated financial statements relate solely to the Company&rsquo;s derivatives described in Note G. The Company adopted FSP 157-2 on January 1, 2009. The adoption of FSP 157-2 did not have a material impact on the Company&rsquo;s condensed consolidated financial statements. </font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

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            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><font size="2">-6-</font></p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"></p>
        </div>

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        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><b><font size="2">LIFETIME BRANDS, INC.</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><b><font size="2">NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><b><font size="2">March 31, 2009</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><font size="2">(unaudited)</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><b><font size="2">NOTE A &mdash; BASIS OF PRESENTATION AND SUMMARY ACCOUNTING POLICIES (continued)</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><b><font size="2">New accounting pronouncements</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">In December 2007, the FASB issued SFAS No. 141 (revised 2007), </font><i><font size="2">Business Combinations</font></i> <font size="2">(&ldquo;SFAS 141(R)&rdquo;). Under SFAS 141(R), an acquiring entity is required to recognize all the assets acquired and liabilities assumed in a transaction at the acquisition date fair value with limited exceptions. SFAS 141(R) changes the accounting treatment for
        certain specific acquisition-related items, including expensing acquisition-related costs as incurred and expensing restructuring costs associated with an acquired business. SFAS 141(R) applies prospectively to business combinations for which the acquisition date is on or after January 1, 2009. The effect of SFAS 141(R) will depend on future acquisitions and, as such, the adoption of SFAS 141(R) did not have a material impact on the Company&rsquo;s condensed consolidated financial
        statements. </font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">In March 2008, the FASB issued SFAS No. 161, </font><i><font size="2">Disclosures about Derivative Instruments and Hedging Activities</font></i> <font size="2">&ndash; </font><i><font size="2">an amendment of FASB Statement No. 133</font></i><font size="2">, which enhances the disclosure requirements for derivatives and hedging activities. SFAS No. 161 was effective for the Company on January 1, 2009. The
        adoption of SFAS No. 161 did not have any impact on the Company&rsquo;s condensed consolidated financial statements.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">In May 2008, the FASB issued FASB Staff Position Accounting Principles Board (&ldquo;APB&rdquo;) No. 14-1, </font><i><font size="2">Accounting for Convertible Debt Instruments That May Be Settled in Cash upon Conversion (Including Partial Cash Settlement)</font></i> <font size="2">(&ldquo;FSP APB 14-1&rdquo;). FSP APB 14-1 requires the issuer of certain convertible debt instruments that may be settled in
        cash, or other assets, on conversion (including partial cash settlement), to separately account for the liability (debt) and equity (conversion option) components in a manner that reflects the issuer&rsquo;s non-convertible debt borrowing rate with the resulting debt discount amortized as additional non-cash interest expense over the life of the convertible debt. The provisions of FSP APB 14-1 were effective for the Company on January 1, 2009. The effects on the Company&rsquo;s
        condensed consolidated financial statements as a result of the adoption of FSP APB 14-1 are described in Note F.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><b><font size="2">Reclassifications </font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">Certain amounts in the 2008 period were reclassified to conform to the presentation in 2009. These reclassifications had no material effect on the Company&rsquo;s previously reported condensed consolidated financial statements.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

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            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><font size="2">-7-</font></p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"></p>
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        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><b><font size="2">LIFETIME BRANDS, INC.</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><b><font size="2">NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><b><font size="2">March 31, 2009</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><font size="2">(unaudited)</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><b><font size="2">NOTE B &mdash; RESTRUCTURING</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><b><font size="2">December 2007 store closings</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">In December 2007, management of the Company commenced a plan to close 27 underperforming Farberware&reg; outlet stores and 3 underperforming Pfaltzgraff&reg; factory stores. All 30 stores were closed by the end of the first quarter of 2008. In connection with the store closings, through March 31, 2009, the Company incurred certain restructuring related costs for store lease obligations, consulting fees,
        employee related expenses and other incremental costs related to the closures of $3.0 million. There were no costs associated with the December 2007 store closings recognized during the three months ended March 31, 2009 and the remaining store lease obligations that were included in accrued expenses at December 31, 2008 related to these store closings of $566,000 were paid during the three months ended March 31, 2009.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><b><font size="2">September 2008 restructuring initiative</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">In September 2008, management of the Company commenced a plan to close all 53 of its remaining Pfaltzgraff&reg; factory and clearance stores and Farberware&reg; outlet stores and vacate its York, PA distribution center. In connection with this restructuring initiative, the Company incurred restructuring related costs of $824,000 during the three months ended March 31, 2009 consisting of the
        following:</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <div align="left">
            <table style="MARGIN-LEFT: 18.9pt; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="40%" border="0">
                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="53%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="5%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="top" width="41%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">Three Months Ended March 31, 2009</font></b></p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="53%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="5%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="41%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font size="2">(in thousands)</font></p>
                    </td>
                </tr>

                <tr bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="53%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Lease obligations</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="5%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="41%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0.5in; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">$742</font></p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="53%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Employee related expenses</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="5%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="top" width="41%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0.5in; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">82</font></p>
                    </td>
                </tr>

                <tr bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="53%">
                        <p style="MARGIN-TOP: 1.5pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 4.5pt; TEXT-ALIGN: left"><font size="2">Total</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="5%">
                        <p style="MARGIN-TOP: 1.5pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 2.25pt double" valign="top" width="41%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0.5in; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">$824</font></p>
                    </td>
                </tr>
            </table>
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">The following is a roll-forward of the amounts included in accrued expenses related to the September 2008 restructuring initiative:</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <div align="left">
            <table style="MARGIN-LEFT: 9.9pt; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="80%" border="0">
                <tr style="HEIGHT: 27.45pt">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 27.45pt" valign="bottom" width="26%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 27.45pt" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid; HEIGHT: 27.45pt" valign="bottom" width="20%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">Balance <br>
                        December 31, 2008</font></b></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 27.45pt" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid; HEIGHT: 27.45pt" valign="bottom" width="10%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">Charges</font></b></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 27.45pt" valign="top" width="2%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid; HEIGHT: 27.45pt" valign="bottom" width="11%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">Payments</font></b></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 27.45pt" valign="top" width="2%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid; HEIGHT: 27.45pt" valign="bottom" width="20%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">Balance </font></b></p>

                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">March 31, 2009</font></b></p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="26%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" colspan="7">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font size="2">(in thousands)</font></p>
                    </td>
                </tr>

                <tr bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="26%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Lease obligations</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="20%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">$7,578</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="10%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 15pt" align="right"><font size="2">$742</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="11%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 7.5pt" align="right"><font size="2">$(2,441)</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="20%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt" align="right"><font size="2">$5,879</font></p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="26%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Consulting fees</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="20%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">354</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="10%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 21.75pt" align="right"><font size="2">&#8213;</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="11%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 17.25pt" align="right"><font size="2">(319)</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="20%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt" align="right"><font size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 35</font></p>
                    </td>
                </tr>

                <tr bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="26%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Employee related expenses</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="20%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">1,168</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="10%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 22.5pt" align="right"><font size="2">82</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="11%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 17.25pt" align="right"><font size="2">(643)</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="20%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt" align="right"><font size="2">&nbsp;&nbsp;&nbsp;&nbsp; 607</font></p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="26%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Other related costs</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="2%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="bottom" width="20%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">224</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="2%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="bottom" width="10%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 24.75pt" align="right"><font size="2">&#8213;</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="top" width="11%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 17.25pt" align="right"><font size="2">(132)</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="bottom" width="20%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt" align="right"><font size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 92</font></p>
                    </td>
                </tr>

                <tr bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="26%">
                        <p style="MARGIN-TOP: 1.5pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 4.5pt; TEXT-ALIGN: left"><font size="2">Total</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="2%">
                        <p style="MARGIN-TOP: 1.5pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 2.25pt double" valign="bottom" width="20%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">$9,324</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="2%">
                        <p style="MARGIN-TOP: 1.5pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 2.25pt double" valign="bottom" width="10%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 12pt" align="right"><font size="2">$824</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="2%">
                        <p style="MARGIN-TOP: 1.5pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 2.25pt double" valign="bottom" width="11%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 12pt" align="right"><font size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; $(3,535)</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="2%">
                        <p style="MARGIN-TOP: 1.5pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 2.25pt double" valign="bottom" width="20%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt" align="right"><font size="2">$6,613</font></p>
                    </td>
                </tr>
            </table>
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">The above restructuring related costs are included within restructuring expenses in the accompanying condensed consolidated statement of operations for the three months ended March 31, 2009 and 2008.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <div title="EE+ Page Footer">
            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"></p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><font size="2">-8-</font></p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"></p>
        </div>

        <div title="EE+ Page Break" style="FONT-SIZE: 1pt; PAGE-BREAK-AFTER: always; WIDTH: 100%; HEIGHT: 1px">
            <hr align="center" width="100%" noshade size="2">
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><b><font size="2">LIFETIME BRANDS, INC.</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><b><font size="2">NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><b><font size="2">March 31, 2009</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><font size="2">(unaudited)</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><b><font size="2">NOTE C &mdash; INVESTMENT IN GRUPO VASCONIA, S.A.B.</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">In December 2007, the Company acquired approximately a 30% interest in Grupo Vasconia, S.A.B. (&ldquo;Vasconia&rdquo;). The Company accounts for its investment in Vasconia using the equity method of accounting. Accordingly, the Company has recorded its proportionate share of Vasconia&rsquo;s net income (reduced for amortization expense related to the customer relationships acquired), for the periods ended
        March 31, 2009 and 2008 in the accompanying condensed consolidated statement of operations. The Company&rsquo;s proportionate share of Vasconia&rsquo;s net income has been translated from Mexican Pesos to U.S. Dollars using the average daily exchange rate during the three months ended March 31, 2009 and 2008 in accordance with Financial Accounting Standard No. 52, </font><i><font size="2">Foreign Currency Translation</font></i><font size="2">.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">Summarized income statement information for Vasconia is as follows:</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <div align="left">
            <table style="MARGIN-LEFT: 5.4pt; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="50%" border="0">
                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="56%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="5%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="top" colspan="3">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">Three Months Ended <br>
                        March 31,</font></b></p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="56%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="5%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="top" width="16%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">2009</font></b></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; BORDER-TOP: black 1pt solid; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="3%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>

                    <td style="BORDER-RIGHT: medium none; PADDING-RIGHT: 5.4pt; BORDER-TOP: black 1pt solid; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="top" width="17%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">2008</font></b></p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="56%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="5%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" colspan="3">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font size="2">(in thousands)</font></p>
                    </td>
                </tr>

                <tr bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="56%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 6.7pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Net sales</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="5%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="16%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">$24,366</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="17%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">$22,132</font></p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="56%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 6.7pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Gross profit</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="5%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="16%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">6,273</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="17%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">6,081</font></p>
                    </td>
                </tr>

                <tr bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="56%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 6.7pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Income from operations</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="5%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="16%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">3,277</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="17%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">2,456</font></p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="56%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 6.7pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Net income</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="5%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="16%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">1,786</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="17%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">1,489</font></p>
                    </td>
                </tr>
            </table>
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><b><font size="2">NOTE D &mdash; INTANGIBLE ASSETS</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><b><font size="2">Intangible assets</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">Intangible assets, all of which relate to the Company&rsquo;s wholesale segment, consist of the following (in thousands):</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <div align="left">
            <table style="MARGIN-LEFT: 5.4pt; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
                <tr style="page-break-inside: avoid">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="19%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 0.05in; TEXT-INDENT: -0.05in; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="2%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="top" colspan="5">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">March 31, &nbsp;2009</font></b></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="2%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="top" colspan="5">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">December 31, 2008</font></b></p>
                    </td>
                </tr>

                <tr bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="19%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 0.05in; TEXT-INDENT: -0.05in; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="2%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="bottom" width="10%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">Gross</font></b></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; BORDER-TOP: black 1pt solid; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>

                    <td style="BORDER-RIGHT: medium none; PADDING-RIGHT: 5.4pt; BORDER-TOP: black 1pt solid; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="bottom" width="13%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">Accumulated Amortization</font></b></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; BORDER-TOP: black 1pt solid; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>

                    <td style="BORDER-RIGHT: medium none; PADDING-RIGHT: 5.4pt; BORDER-TOP: black 1pt solid; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="bottom" width="10%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">Net</font></b></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="bottom" width="10%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">Gross</font></b></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; BORDER-TOP: black 1pt solid; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>

                    <td style="BORDER-RIGHT: medium none; PADDING-RIGHT: 5.4pt; BORDER-TOP: black 1pt solid; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="bottom" width="13%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">Accumulated Amortization</font></b></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; BORDER-TOP: black 1pt solid; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>

                    <td style="BORDER-RIGHT: medium none; PADDING-RIGHT: 5.4pt; BORDER-TOP: black 1pt solid; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="bottom" width="8%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">Net</font></b></p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="19%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 5.4pt; TEXT-INDENT: -5.4pt; TEXT-ALIGN: left"><b><font size="2">Indefinite-lived intangible assets:</font></b></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="10%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="13%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="10%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="10%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="13%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="8%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>
                </tr>

                <tr bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="19%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0.3in; TEXT-INDENT: -9pt; TEXT-ALIGN: left"><font size="2">Trade names</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="10%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">$25,530</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="13%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#8213;</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="10%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">$25,530</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="10%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">$25,530</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="13%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#8213;</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="8%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">$25,530</font></p>
                    </td>
                </tr>

                <tr style="HEIGHT: 2.15pt">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 2.15pt" valign="top" width="19%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 2.15pt" valign="top" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 2.15pt" valign="bottom" width="10%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 2.15pt" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 2.15pt" valign="bottom" width="13%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 2.15pt" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 2.15pt" valign="bottom" width="10%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 2.15pt" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 2.15pt" valign="bottom" width="10%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 2.15pt" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 2.15pt" valign="bottom" width="13%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 2.15pt" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 2.15pt" valign="bottom" width="8%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>
                </tr>

                <tr bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="19%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 5.4pt; TEXT-INDENT: -5.4pt; TEXT-ALIGN: left"><b><font size="2">Finite-lived intangible assets:</font></b></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="10%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="13%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="10%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="10%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="13%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="8%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="19%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 12.6pt; TEXT-ALIGN: left"><font size="2">Licenses</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="10%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">15,847</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="13%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">(5,287)</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="10%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">10,560</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="10%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">15,847</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="13%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">(5,123)</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="8%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">10,724</font></p>
                    </td>
                </tr>

                <tr bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="19%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 12.6pt; TEXT-ALIGN: left"><font size="2">Trade names</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="10%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">2,477</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="13%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">(1,123)</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="10%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">1,354</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="10%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">2,477</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="13%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">(1,103)</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="8%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">1,374</font></p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="19%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 19pt; TEXT-INDENT: -6.4pt; TEXT-ALIGN: left"><font size="2">Customer relationships</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="10%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">586</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="13%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">(346)</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="10%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">240</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="10%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">586</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="13%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">(321)</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="8%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">265</font></p>
                    </td>
                </tr>

                <tr bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="19%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 19pt; TEXT-INDENT: -6.4pt; TEXT-ALIGN: left"><font size="2">Patents</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="bottom" width="10%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">584</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="bottom" width="13%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">(66)</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="bottom" width="10%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">518</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="bottom" width="10%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">584</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="bottom" width="13%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">(57)</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="bottom" width="8%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">527</font></p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="19%">
                        <p style="MARGIN-TOP: 1.5pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Total </font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="2%">
                        <p style="MARGIN-TOP: 1.5pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 2.25pt double" valign="bottom" width="10%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">$45,024</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 1.5pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 2.25pt double" valign="bottom" width="13%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">$(6,822)</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 1.5pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 2.25pt double" valign="bottom" width="10%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">$38,202</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 1.5pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 2.25pt double" valign="bottom" width="10%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">$45,024</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 1.5pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 2.25pt double" valign="bottom" width="13%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">$(6,604)</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 1.5pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 2.25pt double" valign="bottom" width="8%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">$38,420</font></p>
                    </td>
                </tr>

                <tr bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="19%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="10%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="13%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="10%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="10%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="13%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="8%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>
                </tr>
            </table>
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

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            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"></p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><font size="2">-9-</font></p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

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        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><b><font size="2">LIFETIME BRANDS, INC.</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><b><font size="2">NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><b><font size="2">March 31, 2009</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><font size="2">(unaudited)</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><b><font size="2">NOTE E </font></b><font size="2">&mdash;</font><b><font size="2">CREDIT FACILITY </font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">The Company has a $150 million secured credit facility that matures on January 31, 2011 (the &ldquo;Credit Facility&rdquo;). Borrowings under the Credit Facility are secured by all assets of the Company. At December 31, 2008, the Company was not in compliance with the financial covenants required by the Credit Facility. </font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">On March 31, 2009, the Company entered into a waiver and amendment to the Credit Facility (the &ldquo;Amendment&rdquo;). Pursuant to the Amendment, the Company&rsquo;s lenders waived the Company&rsquo;s non-compliance with the financial covenants required by the Credit Facility at December 31, 2008. The Amendment modifies the Credit Facility in certain ways including, as follows: (i) changes the maturity
        date to January 31, 2011, (ii) adds certain asset categories to the borrowing base, (iii) increases the applicable margin rates (including a minimum LIBOR of 1.75%), (iv) revises the minimum EBITDA and fixed charge coverage covenants and adds both a minimum net sales and maximum capital expenditures covenant, (v) eliminates the requirement of maximum leverage and minimum interest coverage ratios, (vi) eliminates the $50 million accordion feature, (vii) revises the minimum excess
        availability amount and (viii) places restrictions on dividends and acquisitions. The Amendment also provides for a lock-box arrangement with the collateral agent. Pursuant to the Amendment, although the Credit Facility matures on January 31, 2011, the Company is required by current accounting standards to classify the indebtedness as a current liability in the condensed consolidated balance sheets as of March 31, 2009 and December 31, 2008.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">At March 31, 2009, the Company had $1.6 million of open letters of credit and $79.7 million of borrowings outstanding under the Credit Facility. Interest rates on outstanding borrowings at March 31, 2009 ranged from 4.75% to 8.37%. Availability under the Credit Facility at March 31, 2009 was $36.4 million (net of $10.0 million of minimum required availability). The Company has interest rate swap and
        collar agreements (see Note G) with an aggregate notional amount of $55.2 million at March 31, 2009. The Company entered into these agreements to effectively fix the interest rate on a portion of its borrowings under the Credit Facility. </font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

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            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><font size="2">-10-</font></p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"></p>
        </div>

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        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><b><font size="2">LIFETIME BRANDS, INC.</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><b><font size="2">NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><b><font size="2">March 31, 2009</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><font size="2">(unaudited)</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><b><font size="2">NOTE F </font></b><font size="2">&mdash;</font><b><font size="2">CONVERTIBLE NOTES</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">The Company has outstanding $75 million aggregate principal amount of 4.75% Convertible Senior Notes due 2011 (the &ldquo;Notes&rdquo;). The Notes are convertible into shares of the Company&rsquo;s common stock at a conversion price of $28.00 per share, subject to adjustment in certain events. The Notes bear interest at 4.75% </font><i><font size="2">per annum</font></i><font size="2">, payable
        semiannually in arrears on January 15 and July 15 of each year and are unsubordinated except with respect to the Company&rsquo;s debt to the extent secured by the Company&rsquo;s assets. The Notes mature on July 15, 2011. The Company may not redeem the Notes at any time prior to maturity.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">The Notes are convertible at the option of the holder anytime prior to the close of business on the business day prior to the maturity date. Upon conversion, the Company may elect to deliver either shares of the Company&rsquo;s common stock, cash or a combination of cash and shares of the Company&rsquo;s common stock in satisfaction of the Company&rsquo;s obligations upon conversion of the Notes. At any
        time prior to the 26<sup>th</sup> trading day preceding the maturity date, the Company may irrevocably elect to satisfy in cash the Company&rsquo;s conversion obligation with respect to the principal amount of the Notes to be converted after the date of such election, with any remaining amount to be satisfied in shares of the Company&rsquo;s common stock. The election would be in the Company&rsquo;s sole discretion without the consent of the holders of the Notes. The conversion rate of
        the Notes may be adjusted upon the occurrence of certain events that would dilute the Company&rsquo;s outstanding common stock. In addition, holders that convert their Notes in connection with certain fundamental changes, such as a change in control, may be entitled to a make whole premium in the form of an increase in the conversion rate. If the Notes are not converted prior to the maturity date the Company is required to pay the holders of the Notes the principal amount of the Notes
        in cash upon maturity. The Company has reserved 2,678,571 shares of common stock for issuance upon conversion of the Notes.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">As part of the issuance of the Notes, the Company incurred $3.1 million in underwriter&rsquo;s discounts and other offering expenses. The offering costs are being amortized to interest expense over the term of the Notes. At March 31, 2009, the unamortized balance of these costs is $1.4 million and is included in other assets in the condensed consolidated balance sheet.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">Effective January 1, 2009, as required by the standard, the Company adopted the provisions of FSP APB 14-1 on a retrospective basis as though the provisions of FSP APB 14-1 were in effect at the date of issuance of the Company&rsquo;s 4.75% Convertible Senior Notes in June 2006. As a result of the adoption of FSP APB 14-1, the Company reclassified $7.9 million (net of taxes of $4.9 million) from
        convertible notes to additional paid-in-capital. The reclassification created a debt discount of $12.8 million that will be amortized to interest expense over a five year period from the date the Company&rsquo;s 4.75% Convertible Senior Notes were issued in June 2006. The cumulative effect of applying the provisions of FSP APB 14-1 resulted in an addition to the accumulated deficit of $3.5 million as of January 1, 2009. </font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

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            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><font size="2">-11-</font></p>

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        <div title="EE+ Page Break" style="FONT-SIZE: 1pt; PAGE-BREAK-AFTER: always; WIDTH: 100%; HEIGHT: 1px">
            <hr align="center" width="100%" noshade size="2">
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><b><font size="2">LIFETIME BRANDS, INC.</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><b><font size="2">NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><b><font size="2">March 31, 2009</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><font size="2">(unaudited)</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><b><font size="2">NOTE F &mdash; CONVERTIBLE NOTES (continued)</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">The following tables set forth the effects of the retrospective adoption of FSP APB 14-1 on the Company&rsquo;s condensed consolidated balance sheet at December 31, 2008 and condensed consolidated statements of operations and cash flows for the three months ended March 31, 2008 (in thousands, except per share data):</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"></p>

        <table style="MARGIN-LEFT: 18.9pt; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="90%" border="0">
            <tr style="page-break-inside: avoid">
                <td valign="bottom" width="513">
                    <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><b><font face="Times New Roman, Times, serif" size="2">Selected balance sheet data:</font></b></p>
                </td>

                <td valign="bottom" width="67">
                    <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>

                <td style="BORDER-BOTTOM: black 1pt solid" valign="bottom" colspan="5">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font face="Times New Roman, Times, serif" size="2">December 31, 2008</font></b></p>
                </td>

                <td valign="bottom" width="4%">
                    <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>
            </tr>

            <tr style="page-break-inside: avoid" bgcolor="#cceeff">
                <td valign="bottom" width="513">
                    <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                </td>

                <td valign="bottom" width="67">
                    <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>

                <td style="BORDER-BOTTOM: black 1pt solid" valign="bottom" colspan="2">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font face="Times New Roman, Times, serif" size="2">As previously reported</font></p>
                </td>

                <td style="BORDER-TOP: black 1pt solid" valign="bottom" width="4%">
                    <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>

                <td style="BORDER-RIGHT: medium none; BORDER-TOP: black 1pt solid; BORDER-LEFT: medium none; BORDER-BOTTOM: black 1pt solid" valign="bottom" colspan="2">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font face="Times New Roman, Times, serif" size="2">(unaudited)<br>
                    As adjusted</font></p>
                </td>

                <td valign="bottom" width="4%">
                    <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>
            </tr>

            <tr style="page-break-inside: avoid">
                <td valign="top" width="513">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 18.65pt; TEXT-INDENT: -0.25in; TEXT-ALIGN: left"><font size="2">Convertible notes</font></p>
                </td>

                <td valign="bottom" width="67">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>

                <td valign="bottom" width="195">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">$</font></p>
                </td>

                <td style="BORDER-TOP: black 1pt solid" valign="bottom" width="48">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">75,000</font></p>
                </td>

                <td valign="bottom" width="4%">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>

                <td valign="bottom" width="154">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">$</font></p>
                </td>

                <td style="BORDER-TOP: black 1pt solid" valign="bottom" width="46">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">67,864</font></p>
                </td>

                <td valign="bottom" width="4%">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>
            </tr>

            <tr style="page-break-inside: avoid" bgcolor="#cceeff">
                <td valign="top" width="513">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 18.65pt; TEXT-INDENT: -0.25in; TEXT-ALIGN: left"><font size="2">Paid-in-capital</font></p>
                </td>

                <td valign="bottom" width="67">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>

                <td valign="bottom" width="195">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                </td>

                <td valign="bottom" width="48">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 2.25pt; TEXT-ALIGN: right"><font size="2">116,869</font></p>
                </td>

                <td valign="bottom" width="4%">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>

                <td valign="bottom" width="154">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                </td>

                <td valign="bottom" width="46">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 2.25pt; TEXT-ALIGN: right"><font size="2">127,497</font></p>
                </td>

                <td valign="bottom" width="4%">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>
            </tr>

            <tr style="page-break-inside: avoid">
                <td valign="top" width="513">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0.25in; TEXT-INDENT: -0.25in; TEXT-ALIGN: left"><font size="2">Accumulated deficit</font></p>
                </td>

                <td valign="bottom" width="67">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>

                <td valign="bottom" width="195">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                </td>

                <td valign="bottom" width="48">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">(18,023</font></p>
                </td>

                <td valign="bottom" width="4%">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">)</font></p>
                </td>

                <td valign="bottom" width="154">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                </td>

                <td valign="bottom" width="46">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">(21,515</font></p>
                </td>

                <td valign="bottom" width="4%">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">)</font></p>
                </td>
            </tr>
        </table>
        <br>
        <br>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"></p>

        <table style="MARGIN-LEFT: 18.9pt; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="90%" border="0">
            <tr style="page-break-inside: avoid">
                <td valign="bottom" width="46%">
                    <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><b><font size="2">Selected statement of operations data:</font></b></p>
                </td>

                <td valign="bottom" width="58">
                    <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>

                <td style="BORDER-BOTTOM: black 1pt solid" valign="bottom" colspan="5">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">Three Months Ended March 31, 2008</font></b></p>
                </td>

                <td valign="bottom" width="44">
                    <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>
            </tr>

            <tr style="page-break-inside: avoid" bgcolor="#cceeff">
                <td valign="bottom" width="46%">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                </td>

                <td valign="bottom" width="58">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>

                <td valign="bottom" colspan="5">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font size="2">(unaudited)</font></p>
                </td>

                <td valign="bottom" width="44">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>
            </tr>

            <tr style="page-break-inside: avoid">
                <td valign="bottom" width="46%">
                    <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                </td>

                <td valign="bottom" width="58">
                    <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>

                <td style="BORDER-BOTTOM: black 1pt solid" valign="bottom" colspan="2">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font size="2">As previously reported</font></p>
                </td>

                <td valign="bottom" width="41">
                    <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>

                <td style="BORDER-BOTTOM: black 1pt solid" valign="bottom" colspan="2">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font size="2">As adjusted</font></p>
                </td>

                <td valign="bottom" width="44">
                    <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>
            </tr>

            <tr style="page-break-inside: avoid" bgcolor="#cceeff">
                <td valign="top" width="46%">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0.25in; TEXT-INDENT: -0.25in; TEXT-ALIGN: left"><font size="2">Interest expense</font></p>
                </td>

                <td valign="bottom" width="58">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>

                <td valign="bottom" width="170">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">$</font></p>
                </td>

                <td style="BORDER-TOP: black 1pt solid" valign="bottom" width="50">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 2.25pt; TEXT-ALIGN: right"><font size="2">(2,093</font></p>
                </td>

                <td valign="bottom" width="41">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">)</font></p>
                </td>

                <td valign="bottom" width="136">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">$</font></p>
                </td>

                <td style="BORDER-TOP: black 1pt solid" valign="bottom" width="43">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 2.25pt; TEXT-ALIGN: right"><font size="2">(2,681</font></p>
                </td>

                <td valign="bottom" width="44">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">)</font></p>
                </td>
            </tr>

            <tr style="page-break-inside: avoid">
                <td valign="top" width="46%">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 18.65pt; TEXT-INDENT: -0.25in; TEXT-ALIGN: left"><font size="2">Loss before income taxes and equity in earnings of Grupo Vasconia, S.A.B.</font></p>
                </td>

                <td valign="bottom" width="58">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>

                <td valign="bottom" width="170">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                </td>

                <td valign="bottom" width="50">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">(10,877</font></p>
                </td>

                <td valign="bottom" width="41">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">)</font></p>
                </td>

                <td valign="bottom" width="136">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                </td>

                <td valign="bottom" width="43">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 2.25pt; TEXT-ALIGN: right"><font size="2">(11,465</font></p>
                </td>

                <td valign="bottom" width="44">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">)</font></p>
                </td>
            </tr>

            <tr style="page-break-inside: avoid" bgcolor="#cceeff">
                <td valign="top" width="46%">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 18.65pt; TEXT-INDENT: -0.25in; TEXT-ALIGN: left"><font size="2">Income tax benefit</font></p>
                </td>

                <td valign="bottom" width="58">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>

                <td valign="bottom" width="170">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                </td>

                <td valign="bottom" width="50">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 2.25pt; TEXT-ALIGN: right"><font size="2">4,623</font></p>
                </td>

                <td valign="bottom" width="41">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>

                <td valign="bottom" width="136">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                </td>

                <td valign="bottom" width="43">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 2.25pt; TEXT-ALIGN: right"><font size="2">4,851</font></p>
                </td>

                <td valign="bottom" width="44">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>
            </tr>

            <tr style="page-break-inside: avoid">
                <td valign="top" width="46%">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0.25in; TEXT-INDENT: -0.25in; TEXT-ALIGN: left"><font size="2">Net loss</font></p>
                </td>

                <td valign="bottom" width="58">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>

                <td valign="bottom" width="170">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                </td>

                <td valign="bottom" width="50">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">(5,997</font></p>
                </td>

                <td valign="bottom" width="41">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">)</font></p>
                </td>

                <td valign="bottom" width="136">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                </td>

                <td valign="bottom" width="43">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">(6,357</font></p>
                </td>

                <td valign="bottom" width="44">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">)</font></p>
                </td>
            </tr>

            <tr style="page-break-inside: avoid" bgcolor="#cceeff">
                <td valign="top" width="46%">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 18.65pt; TEXT-INDENT: -0.25in; TEXT-ALIGN: left"><font size="2">Basic and diluted loss per common share</font></p>
                </td>

                <td valign="bottom" width="58">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>

                <td valign="bottom" width="170">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                </td>

                <td valign="bottom" width="50">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">(0.50</font></p>
                </td>

                <td valign="bottom" width="41">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">)</font></p>
                </td>

                <td valign="bottom" width="136">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                </td>

                <td valign="bottom" width="43">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">(0.53</font></p>
                </td>

                <td valign="bottom" width="44">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">)</font></p>
                </td>
            </tr>
        </table>
        <br>
        <br>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"></p>

        <table style="MARGIN-LEFT: 18.9pt; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="90%" border="0">
            <tr style="page-break-inside: avoid">
                <td valign="bottom" width="460">
                    <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><b><font size="2">Selected cash flow data:</font></b></p>
                </td>

                <td valign="bottom" width="58">
                    <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>

                <td style="BORDER-BOTTOM: black 1pt solid" valign="bottom" colspan="5">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">Three Months Ended March 31, 2008</font></b></p>
                </td>

                <td valign="bottom" width="48">
                    <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>
            </tr>

            <tr style="page-break-inside: avoid" bgcolor="#cceeff">
                <td valign="bottom" width="460">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                </td>

                <td valign="bottom" width="58">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>

                <td valign="bottom" colspan="5">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font size="2">(unaudited)</font></p>
                </td>

                <td valign="bottom" width="48">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>
            </tr>

            <tr style="page-break-inside: avoid">
                <td valign="bottom" width="460">
                    <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                </td>

                <td valign="bottom" width="58">
                    <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>

                <td style="BORDER-BOTTOM: black 1pt solid" valign="bottom" colspan="2">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font size="2">As previously reported</font></p>
                </td>

                <td valign="bottom" width="44">
                    <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>

                <td style="BORDER-BOTTOM: black 1pt solid" valign="bottom" colspan="2">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font size="2">As adjusted</font></p>
                </td>

                <td valign="bottom" width="48">
                    <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>
            </tr>

            <tr style="page-break-inside: avoid" bgcolor="#cceeff">
                <td valign="top" width="460">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0.25in; TEXT-INDENT: -0.25in; TEXT-ALIGN: left"><font size="2">Net loss </font></p>
                </td>

                <td valign="bottom" width="58">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>

                <td valign="bottom" width="170">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">$</font></p>
                </td>

                <td style="BORDER-TOP: black 1pt solid" valign="bottom" width="49">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 2.25pt; TEXT-ALIGN: right"><font size="2">(5,997</font></p>
                </td>

                <td valign="bottom" width="44">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">)</font></p>
                </td>

                <td valign="bottom" width="133">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">$</font></p>
                </td>

                <td style="BORDER-TOP: black 1pt solid" valign="bottom" width="40">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 2.25pt; TEXT-ALIGN: right"><font size="2">(6,357</font></p>
                </td>

                <td valign="bottom" width="48">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">)</font></p>
                </td>
            </tr>

            <tr style="page-break-inside: avoid">
                <td valign="top" width="460">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 18.65pt; TEXT-INDENT: -0.25in; TEXT-ALIGN: left"><font size="2">Amortization of debt discount</font></p>
                </td>

                <td valign="bottom" width="58">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>

                <td valign="bottom" width="170">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                </td>

                <td valign="bottom" width="49">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">&#8213;</font></p>
                </td>

                <td valign="bottom" width="44">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>

                <td valign="bottom" width="133">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                </td>

                <td valign="bottom" width="40">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 2.25pt; TEXT-ALIGN: right"><font size="2">588</font></p>
                </td>

                <td valign="bottom" width="48">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>
            </tr>

            <tr style="page-break-inside: avoid" bgcolor="#cceeff">
                <td valign="top" width="460">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 18.65pt; TEXT-INDENT: -0.25in; TEXT-ALIGN: left"><font size="2">Deferred income taxes</font></p>
                </td>

                <td valign="bottom" width="58">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>

                <td valign="bottom" width="170">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                </td>

                <td valign="bottom" width="49">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">&#8213;</font></p>
                </td>

                <td valign="bottom" width="44">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>

                <td valign="bottom" width="133">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                </td>

                <td valign="bottom" width="40">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">(228</font></p>
                </td>

                <td valign="bottom" width="48">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">)</font></p>
                </td>
            </tr>
        </table>
        <br>
        <br>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><font size="2">At March 31, 2009 and December 31, 2008, the carrying amount of the debt and equity components of the Company&rsquo;s 4.75% Convertible Senior Notes were as follows (in thousands):</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <div align="left">
            <table style="MARGIN-LEFT: 18.9pt; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="90%" border="0">
                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="55%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="141">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="top" width="97">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">March 31, </font></b></p>

                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">2009</font></b></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="17">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="top" width="143">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">December 31, <br>
                        2008</font></b></p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="55%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="141">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" colspan="3">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font size="2">(unaudited)</font></p>
                    </td>
                </tr>

                <tr bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="55%">
                        <p style="MARGIN-TOP: 1.5pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Carrying amount of equity component, net of tax</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="141">
                        <p style="MARGIN-TOP: 1.5pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 2.25pt double" valign="bottom" width="97">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0.5in; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">$&nbsp;&nbsp;10,628&nbsp; </font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="17">
                        <p style="MARGIN-TOP: 1.5pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 0.5in; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 2.25pt double" valign="bottom" width="143">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 12pt" align="center"><font size="2">$ &nbsp;10,628</font></p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="55%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="141">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="97">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="17">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0.5in; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="143">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0.5in; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>
                </tr>

                <tr bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="55%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Principal amount of liability component</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="141">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="97">
                        <p style="MARGIN-TOP: 0in; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 0.5in; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">&nbsp; (75,000)</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="17">
                        <p style="MARGIN-TOP: 0in; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 0.5in; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="143">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 15pt; TEXT-ALIGN: center"><font size="2">$(75,000)</font></p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="55%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Unamortized discount</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="141">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="bottom" width="97">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0.5in; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">&nbsp;&nbsp;&nbsp; 6,492&nbsp; </font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="17">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 0.5in; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="bottom" width="143">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 15pt; TEXT-ALIGN: center"><font size="2">&nbsp;&nbsp;&nbsp;&nbsp; 7,136</font></p>
                    </td>
                </tr>

                <tr bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="55%">
                        <p style="MARGIN-TOP: 1.5pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 7.5pt; TEXT-ALIGN: left"><font size="2">Carrying amount of debt component</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="141">
                        <p style="MARGIN-TOP: 1.5pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 2.25pt double" valign="bottom" width="97">
                        <p style="MARGIN-TOP: 0in; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 0.5in; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">$(68,508) </font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="17">
                        <p style="MARGIN-TOP: 1.5pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 0.5in; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 2.25pt double" valign="bottom" width="143">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 15pt; TEXT-ALIGN: center"><font size="2">$(67,864)</font></p>
                    </td>
                </tr>
            </table>
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">At March 31, 2009 the remaining period over which the debt discount will be amortized is 2.25 years. The effective interest rate of the liability component was 9.02% at the date of issuance. Total interest recognized related to the Company&rsquo;s 4.75% Convertible Senior Notes for the three months ended March 31, 2009 and 2008, including amortization of the debt discount and offering costs, was $1.3
        million and $1.2 million, respectively.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <div title="EE+ Page Footer">
            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"></p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><font size="2">-12-</font></p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"></p>
        </div>

        <div title="EE+ Page Break" style="FONT-SIZE: 1pt; PAGE-BREAK-AFTER: always; WIDTH: 100%; HEIGHT: 1px">
            <hr align="center" width="100%" noshade size="2">
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><b><font size="2">LIFETIME BRANDS, INC.</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><b><font size="2">NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><b><font size="2">March 31, 2009</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><font size="2">(unaudited)</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><b><font size="2">NOTE G </font></b><font size="2">&mdash;</font><b><font size="2">DERIVATIVES </font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">The Company has interest rate swap agreements with an aggregate notional amount of $50 million and interest rate collar agreements with an aggregate notional amount of $40.2 million to manage interest rate exposure in connection with its variable interest rate borrowings.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">Certain interest rate swap agreements with an aggregate notional amount of $35 million were not designated as hedges under SFAS 133 and the fair value gains or losses from these swap agreements are recognized in earnings (loss). The effect of recording these interest rate swap agreements at fair value resulted in an unrealized gain of $39,000 for the three months ended March 31, 2009, which is included in
        interest expense. The agreements expire in 2011.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">An interest rate swap agreement with a notional amount of $15 million and the interest rate collar agreements were designated as cash flow hedges under SFAS 133. The effective portion of the fair value gains or losses on these agreements is recorded as a component of accumulated other comprehensive loss. The effect of recording these derivatives at fair value resulted in an unrealized gain of $122,000 for
        the three months ended March 31, 2009. No amounts recorded in accumulated other comprehensive loss are expected to be reclassified to interest expense in the next twelve months. The agreements expire in 2010.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">The fair value of the above derivatives have been obtained from the counterparties to the agreements and are based on Level 2 observable inputs using proprietary models and estimates about relevant future market conditions. The aggregate fair value of the Company&rsquo;s derivative instruments was a liability of $2.4 million at March 31, 2009 and is included in deferred rent &amp; other long-term
        liabilities.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><b><font size="2">NOTE H </font></b><font size="2">&mdash;</font><b><font size="2">STOCK OPTIONS</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">A summary of the Company&rsquo;s stock option activity and related information for the three months ended March 31, 2009 is as follows:</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <div align="center">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="98%" border="0">
                <tr>
                    <td style="PADDING-RIGHT: 0.05in; PADDING-LEFT: 0.05in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="40%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 0.05in; PADDING-LEFT: 0.05in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="48">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 0.05in; PADDING-LEFT: 0.05in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="bottom" colspan="2">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">Options</font></b></p>
                    </td>

                    <td style="PADDING-RIGHT: 0.05in; PADDING-LEFT: 0.05in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="1%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 0.05in; PADDING-LEFT: 0.05in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="bottom" colspan="2">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">Weighted-</font></b></p>

                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">average</font></b></p>

                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">exercise price</font></b></p>
                    </td>

                    <td style="PADDING-RIGHT: 0.05in; PADDING-LEFT: 0.05in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="1%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 0.05in; PADDING-LEFT: 0.05in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="top" width="15%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">Weighted- average remaining contractual life (years)</font></b></p>
                    </td>

                    <td style="PADDING-RIGHT: 0.05in; PADDING-LEFT: 0.05in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="1%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 0.05in; PADDING-LEFT: 0.05in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="bottom" width="12%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">Aggregate intrinsic value</font></b></p>
                    </td>
                </tr>

                <tr bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 0.05in; PADDING-LEFT: 0.05in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="baseline" width="40%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 22.95pt; TEXT-INDENT: -8.05pt; TEXT-ALIGN: left"><b><font size="2">Options outstanding, January 1, 2009</font></b></p>
                    </td>

                    <td style="PADDING-RIGHT: 0.05in; PADDING-LEFT: 0.05in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="baseline" width="48">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>

                    <td style="PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="baseline" width="92" colspan="1">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 7.5pt" align="right"><font size="2">&nbsp;2,036,650</font></p>
                    </td>

                    <td valign="baseline" width="47">
                        <p align="right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 0.05in; PADDING-LEFT: 0.05in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="baseline" width="1%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>

                    <td style="PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="baseline" align="left" width="60">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 12pt" align="right"><font size="2">$</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 0px; PADDING-LEFT: 0px; PADDING-BOTTOM: 0px; MARGIN: 0px; PADDING-TOP: 0px" valign="baseline" align="left" width="70"><font size="2">20.41</font></td>

                    <td style="PADDING-RIGHT: 0.05in; PADDING-LEFT: 0.05in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="baseline" width="1%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 0.05in; PADDING-LEFT: 0.05in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="baseline" width="15%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 0.05in; PADDING-LEFT: 0.05in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="baseline" width="1%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 0.05in; PADDING-LEFT: 0.05in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="baseline" width="12%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt" align="center">&nbsp;&nbsp;</p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 0.05in; PADDING-LEFT: 0.05in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="baseline" width="40%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0.1in; TEXT-INDENT: 12.95pt; TEXT-ALIGN: left"><font size="2">Grants</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 0.05in; PADDING-LEFT: 0.05in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="baseline" width="48">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>

                    <td style="PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="baseline" width="92">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 16.5pt" align="right"><font size="2">&#8213;</font></p>
                    </td>

                    <td valign="baseline" width="47">
                    </td>

                    <td style="PADDING-RIGHT: 0.05in; PADDING-LEFT: 0.05in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="baseline" width="1%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 0.05in; PADDING-LEFT: 0.05in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="baseline" width="12%" colspan="2">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 4.5pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 0.05in; PADDING-LEFT: 0.05in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="baseline" width="1%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 0.05in; PADDING-LEFT: 0.05in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="baseline" width="15%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 0.05in; PADDING-LEFT: 0.05in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="baseline" width="1%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 0.05in; PADDING-LEFT: 0.05in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="baseline" width="12%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>
                </tr>

                <tr bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 0.05in; PADDING-LEFT: 0.05in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="baseline" width="40%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 15.1pt; TEXT-INDENT: 5.25pt; TEXT-ALIGN: left"><font size="2">Exercises</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 0.05in; PADDING-LEFT: 0.05in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="baseline" width="48">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>

                    <td style="PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="baseline" width="92" colspan="1">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 16.5pt" align="right"><font size="2">&#8213;</font></p>
                    </td>

                    <td valign="baseline" width="47">
                    </td>

                    <td style="PADDING-RIGHT: 0.05in; PADDING-LEFT: 0.05in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="baseline" width="1%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 0.05in; PADDING-LEFT: 0.05in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="baseline" width="12%" colspan="2">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 4.5pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 0.05in; PADDING-LEFT: 0.05in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="baseline" width="1%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 0.05in; PADDING-LEFT: 0.05in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="baseline" width="15%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 0.05in; PADDING-LEFT: 0.05in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="baseline" width="1%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 0.05in; PADDING-LEFT: 0.05in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="baseline" width="12%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 0.05in; PADDING-LEFT: 0.05in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="baseline" width="40%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 0.1in; TEXT-INDENT: 13.15pt; TEXT-ALIGN: left"><font size="2">Cancellations</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 0.05in; PADDING-LEFT: 0.05in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="baseline" width="48">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>

                    <td style="PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="baseline" width="92" colspan="1">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 7.5pt" align="right"><font size="2">(692,500</font></p>
                    </td>

                    <td style="BORDER-BOTTOM: black 1px solid" valign="baseline" align="left" width="47"><font size="2">)</font></td>

                    <td style="PADDING-RIGHT: 0.05in; PADDING-LEFT: 0.05in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="baseline" width="1%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 0.05in; PADDING-LEFT: 0.05in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="baseline" width="60" colspan="1">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 4.5pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>

                    <td valign="baseline" width="70">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt" align="left"><font size="2">25.82</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 0.05in; PADDING-LEFT: 0.05in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="baseline" width="1%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 0.05in; PADDING-LEFT: 0.05in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="baseline" width="15%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 0.05in; PADDING-LEFT: 0.05in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="baseline" width="1%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 0.05in; PADDING-LEFT: 0.05in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="baseline" width="12%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>
                </tr>

                <tr bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 0.05in; PADDING-LEFT: 0.05in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="baseline" width="40%">
                        <p style="MARGIN-TOP: 1.5pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 23pt; TEXT-INDENT: -7.9pt; TEXT-ALIGN: left"><b><font size="2">Options outstanding, March 31, 2009</font></b></p>
                    </td>

                    <td style="PADDING-RIGHT: 0.05in; PADDING-LEFT: 0.05in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="baseline" width="48">
                        <p style="MARGIN-TOP: 1.5pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>

                    <td style="PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 2.25pt double" valign="baseline" width="92" colspan="1">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 7.5pt" align="right"><font size="2">1,344,150</font></p>
                    </td>

                    <td style="BORDER-BOTTOM: black 2.25pt double" valign="baseline" width="47">
                    </td>

                    <td style="PADDING-RIGHT: 0.05in; PADDING-LEFT: 0.05in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="baseline" width="1%">
                        <p style="MARGIN-TOP: 1.5pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 0.05in; PADDING-LEFT: 0.05in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="baseline" width="60" colspan="1">
                        <p style="MARGIN-TOP: 1.5pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 4.5pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>

                    <td valign="baseline" width="70">
                        <p style="MARGIN-TOP: 1.5pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt" align="left"><font size="2">17.63</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 0.05in; PADDING-LEFT: 0.05in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="baseline" width="1%">
                        <p style="MARGIN-TOP: 1.5pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 0.05in; PADDING-LEFT: 0.05in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="baseline" width="15%">
                        <p style="MARGIN-TOP: 1.5pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font size="2">7.87</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 0.05in; PADDING-LEFT: 0.05in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="baseline" width="1%">
                        <p style="MARGIN-TOP: 1.5pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 0.05in; PADDING-LEFT: 0.05in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 2.25pt double" valign="baseline" width="12%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt" align="right"><font size="2">$ &#8213;</font></p>
                    </td>
                </tr>

                <tr style="HEIGHT: 10.65pt">
                    <td style="PADDING-RIGHT: 0.05in; PADDING-LEFT: 0.05in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 10.65pt" valign="baseline" width="40%">
                        <p style="MARGIN-TOP: 1.5pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 23pt; TEXT-INDENT: -7.9pt; TEXT-ALIGN: left"><b><font size="2">Options exercisable, March 31, 2009</font></b></p>
                    </td>

                    <td style="PADDING-RIGHT: 0.05in; PADDING-LEFT: 0.05in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 10.65pt" valign="baseline" width="48">
                        <p style="MARGIN-TOP: 1.5pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>

                    <td style="PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 2.25pt double; HEIGHT: 10.65pt" valign="baseline" width="92" colspan="1">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 7.5pt" align="right"><font size="2">566,750</font></p>
                    </td>

                    <td style="BORDER-BOTTOM: black 2.25pt double" valign="baseline" width="47">
                    </td>

                    <td style="PADDING-RIGHT: 0.05in; PADDING-LEFT: 0.05in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 10.65pt" valign="baseline" width="1%">
                        <p style="MARGIN-TOP: 1.5pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 0.05in; PADDING-LEFT: 0.05in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 10.65pt" valign="baseline" width="60" colspan="1">
                        <p style="MARGIN-TOP: 1.5pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 4.5pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>

                    <td valign="baseline" width="70">
                        <p style="MARGIN-TOP: 1.5pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt" align="left"><font size="2">16.64</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 0.05in; PADDING-LEFT: 0.05in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 10.65pt" valign="baseline" width="1%">
                        <p style="MARGIN-TOP: 1.5pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 0.05in; PADDING-LEFT: 0.05in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 10.65pt" valign="baseline" width="15%">
                        <p style="MARGIN-TOP: 1.5pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font size="2">4.99</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 0.05in; PADDING-LEFT: 0.05in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 10.65pt" valign="baseline" width="1%">
                        <p style="MARGIN-TOP: 1.5pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 0.05in; PADDING-LEFT: 0.05in; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 2.25pt double; HEIGHT: 10.65pt" valign="baseline" width="12%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt" align="right"><font size="2">$ &#8213;</font></p>
                    </td>
                </tr>
            </table>
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">The aggregate intrinsic value in the table above represents the total pre-tax intrinsic value that would have been received by the option holders had all option holders exercised their stock options on March 31, 2009. The intrinsic value is calculated for each in-the-money stock option as the difference between the closing price of the Company&rsquo;s common stock on March 31, 2009 and the exercise price.
        There were no in-the-money options at March 31, 2009.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">The intrinsic value of a stock option that is exercised is calculated as the difference between the quoted market price of the Company&rsquo;s common stock at the date of exercise and the exercise price of the stock option multiplied by the number of shares exercised. There were no stock options exercised during the three months ended March 31, 2009. </font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <div title="EE+ Page Footer">
            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"></p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><font size="2">-13-</font></p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"></p>
        </div>

        <div title="EE+ Page Break" style="FONT-SIZE: 1pt; PAGE-BREAK-AFTER: always; WIDTH: 100%; HEIGHT: 1px">
            <hr align="center" width="100%" noshade size="2">
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><b><font size="2">LIFETIME BRANDS, INC.</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><b><font size="2">NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><b><font size="2">March 31, 2009</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><font size="2">(unaudited)</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><b><font size="2">NOTE H </font></b><font size="2">&mdash; </font><b><font size="2">STOCK OPTIONS (continued)</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">The Company recognized stock option expense of $459,000 and $613,000 for the three months ended March 31, 2009 and 2008, respectively. Total unrecognized compensation cost related to unvested stock options at March 31, 2009, before the effect of income taxes, was $4.5 million and is expected to be recognized over a weighted-average period of 2.8 years.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">In February 2009, two key executives of the Company irrevocably and voluntarily cancelled their options to purchase 600,000 shares of the Company&rsquo;s common stock, which had a nominal fair value, in order to increase the shares available for grant under the Plan. </font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <div align="left">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="42%" border="0">
                <tr>
                    <td valign="top" nowrap width="100%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify"><b><font size="2">NOTE I &mdash; LOSS PER COMMON SHARE </font></b></p>
                    </td>
                </tr>
            </table>
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">Basic loss per common share has been computed by dividing net loss by the weighted-average number of shares of the Company&rsquo;s common stock outstanding. Diluted loss per common share adjusts net loss and basic loss per common share for the effect of all potentially dilutive shares of the Company&rsquo;s common stock. The calculations of basic and diluted loss per common share for the three months
        ended March 31, 2009 and 2008 are as follows:</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <div align="left">
            <table style="MARGIN-LEFT: 0.9pt; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="97%" border="0">
                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="58%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="2%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="bottom" colspan="3">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">Three Months Ended </font></b></p>

                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">March 31, </font></b></p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="58%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 0.35pt; TEXT-INDENT: -0.35pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="2%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="bottom" width="16%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">2009</font></b></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; BORDER-TOP: black 1pt solid; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="6%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>

                    <td style="BORDER-RIGHT: medium none; PADDING-RIGHT: 5.4pt; BORDER-TOP: black 1pt solid; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="bottom" width="15%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">2008</font></b></p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="58%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: -4.3pt; TEXT-INDENT: 4.3pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" colspan="3">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0.35pt; TEXT-INDENT: -0.35pt; TEXT-ALIGN: center"><font size="2">(in thousands, except per share amounts)</font></p>
                    </td>
                </tr>

                <tr bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="58%">
                        <p style="MARGIN-TOP: 1.5pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><b><font size="2">Net loss </font></b><font size="2">&#8213; </font><b><font size="2">Basic</font></b></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 0px; PADDING-LEFT: 0px; MARGIN-LEFT: 0px; MARGIN-RIGHT: 0px" valign="bottom" align="right" width="16%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt" align="right"><font size="2">$(5,959)</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="6%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 0px; PADDING-LEFT: 0px; MARGIN-LEFT: 0px; MARGIN-RIGHT: 0px" valign="bottom" align="right" width="15%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt" align="right"><font size="2">$(6,357)</font></p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="58%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 17.1pt; TEXT-INDENT: -12.6pt; TEXT-ALIGN: left"><font size="2">Interest expense, 4.75% Convertible Senior Notes, net of tax</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="2%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 0px; PADDING-LEFT: 0px; MARGIN-LEFT: 0px; MARGIN-RIGHT: 0px; BORDER-BOTTOM: black 1px solid" valign="bottom" align="right" width="16%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 49pt" align="right"><font size="2">&#8213;</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="6%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 0px; PADDING-LEFT: 0px; MARGIN-LEFT: 0px; MARGIN-RIGHT: 0px; BORDER-BOTTOM: black 1px solid" valign="bottom" align="right" width="15%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt" align="right"><font size="2">&nbsp;&#8213;</font></p>
                    </td>
                </tr>

                <tr bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="58%">
                        <p style="MARGIN-TOP: 1.5pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><b><font size="2">Net loss </font></b><font size="2">&#8213; </font><b><font size="2">Diluted</font></b></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="2%">
                        <p style="MARGIN-TOP: 1.5pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 0px; PADDING-LEFT: 0px; MARGIN-LEFT: 0px; MARGIN-RIGHT: 0px; BORDER-BOTTOM: black 2.25pt double" valign="bottom" align="right" width="16%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt" align="right"><font size="2">$(5,959)</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="6%">
                        <p style="MARGIN-TOP: 1.5pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 0px; PADDING-LEFT: 0px; MARGIN-LEFT: 0px; MARGIN-RIGHT: 0px; BORDER-BOTTOM: black 2.25pt double" valign="bottom" align="right" width="15%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt" align="right"><font size="2">$(6,357)</font></p>
                    </td>
                </tr>

                <tr style="HEIGHT: 0.1in">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 0.1in" valign="bottom" width="58%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 0.1in" valign="top" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 0px; PADDING-LEFT: 0px; MARGIN-LEFT: 0px; MARGIN-RIGHT: 0px" valign="bottom" align="right" width="16%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 0.1in" valign="bottom" width="6%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 0px; PADDING-LEFT: 0px; MARGIN-LEFT: 0px; MARGIN-RIGHT: 0px" valign="bottom" align="right" width="15%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>
                </tr>

                <tr bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="58%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><b><font size="2">Weighted-average shares outstanding </font></b><font size="2">&#8213; </font><b><font size="2">Basic</font></b></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 0px; PADDING-LEFT: 0px; MARGIN-LEFT: 0px; MARGIN-RIGHT: 0px" valign="bottom" align="right" width="16%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt" align="right"><font size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 11,990</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="6%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 0px; PADDING-LEFT: 0px; MARGIN-LEFT: 0px; MARGIN-RIGHT: 0px" valign="bottom" align="right" width="15%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 22.5pt" align="right"><font size="2">11,966</font></p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="58%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 3.5pt; TEXT-ALIGN: left"><font size="2">Effect of dilutive securities:</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 0px; PADDING-LEFT: 0px; MARGIN-LEFT: 0px; MARGIN-RIGHT: 0px" valign="bottom" align="right" width="16%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="6%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 0px; PADDING-LEFT: 0px; MARGIN-LEFT: 0px; MARGIN-RIGHT: 0px" valign="bottom" align="right" width="15%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>
                </tr>

                <tr bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="58%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 12.55pt; TEXT-ALIGN: left"><font size="2">Stock options</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 0px; PADDING-LEFT: 0px; MARGIN-LEFT: 0px; MARGIN-RIGHT: 0px" valign="top" align="right" width="16%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt" align="right"><font size="2">&nbsp;&#8213;</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="6%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 0px; PADDING-LEFT: 0px; MARGIN-LEFT: 0px; MARGIN-RIGHT: 0px" valign="bottom" align="right" width="15%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt" align="right"><font size="2">&#8213;</font></p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="58%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 12.55pt; TEXT-ALIGN: left"><font size="2">4.75% Convertible Senior Notes</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="2%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 0px; PADDING-LEFT: 0px; MARGIN-LEFT: 0px; MARGIN-RIGHT: 0px; BORDER-BOTTOM: black 1px solid" valign="top" align="right" width="16%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt" align="right"><font size="2">&#8213;</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="6%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 0px; PADDING-LEFT: 0px; MARGIN-LEFT: 0px; MARGIN-RIGHT: 0px; BORDER-BOTTOM: black 1px solid" valign="bottom" align="right" width="15%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt" align="right"><font size="2">&#8213;</font></p>
                    </td>
                </tr>

                <tr style="HEIGHT: 16.15pt" bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 16.15pt" valign="bottom" width="58%">
                        <p style="MARGIN-TOP: 1.5pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><b><font size="2">Weighted-average shares outstanding </font></b><font size="2">&#8213; </font><b><font size="2">Diluted</font></b></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 16.15pt" valign="top" width="2%">
                        <p style="MARGIN-TOP: 1.5pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 0px; PADDING-LEFT: 0px; MARGIN-LEFT: 0px; MARGIN-RIGHT: 0px; BORDER-BOTTOM: black 2.25pt double" valign="bottom" align="right" width="16%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt" align="right"><font size="2">11,990</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 16.15pt" valign="bottom" width="6%">
                        <p style="MARGIN-TOP: 1.5pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 0px; PADDING-LEFT: 0px; MARGIN-LEFT: 0px; MARGIN-RIGHT: 0px; BORDER-BOTTOM: black 2.25pt double" valign="bottom" align="right" width="15%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 22.5pt" align="right"><font size="2">11,966</font></p>
                    </td>
                </tr>

                <tr style="HEIGHT: 18.6pt">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 18.6pt" valign="bottom" width="58%">
                        <p style="MARGIN-TOP: 1.5pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><b><font size="2">Basic and Diluted loss per common share</font></b></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 18.6pt" valign="bottom" width="2%">
                        <p style="MARGIN-TOP: 1.5pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 0px; PADDING-LEFT: 0px; MARGIN-LEFT: 0px; MARGIN-RIGHT: 0px; BORDER-BOTTOM: black 2.25pt double" valign="bottom" align="right" width="16%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt" align="right"><font size="2">$&nbsp; (0.50)</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 18.6pt" valign="bottom" width="6%">
                        <p style="MARGIN-TOP: 1.5pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 0px; PADDING-LEFT: 0px; MARGIN-LEFT: 0px; MARGIN-RIGHT: 0px; BORDER-BOTTOM: black 2.25pt double" valign="bottom" align="right" width="15%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 2.25pt" align="right"><font size="2">$ (0.53)</font></p>
                    </td>
                </tr>
            </table>
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">The computations of diluted loss per common share for the three months ended March 31, 2009 and 2008 exclude: (i) options to purchase 1,344,150 shares and 1,508,500 shares, respectively; and (ii) 2,678,571 shares of the Company&rsquo;s common stock issuable upon the conversion of the Company&rsquo;s 4.75% Convertible Senior Notes and related interest expense. The shares were excluded due to their
        antidilutive effect as a result of the losses during the periods.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <div title="EE+ Page Footer">
            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"></p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><font size="2">-14-</font></p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"></p>
        </div>

        <div title="EE+ Page Break" style="FONT-SIZE: 1pt; PAGE-BREAK-AFTER: always; WIDTH: 100%; HEIGHT: 1px">
            <hr align="center" width="100%" noshade size="2">
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><b><font size="2">LIFETIME BRANDS, INC.</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><b><font size="2">NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><b><font size="2">March 31, 2009</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><font size="2">(unaudited)</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><b><font size="2">NOTE J &mdash; INCOME TAXES</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">At December 31, 2008, the Company had a Federal net operating loss carry forward of $1.3 million which will expire in 2029. Additionally, the Company has various state net operating loss carry forwards that will begin to expire in 2014. Since management is uncertain of its ability to utilize its future deferred tax benefits, a full valuation allowance has been established. In accordance with SFAS No. 109,
        </font><i><font size="2">Accounting for Income Taxes</font></i><font size="2">, the Company has offset its total deferred tax asset with certain deferred tax liabilities that are expected to reverse in the carry forward period. </font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">As a result of the taxable loss incurred for 2008, the Company filed a federal income tax return reflecting a refund due of $11.4 million on income taxes paid for 2006 and 2007. The income tax return was filed in April 2009 and the amount due is reflected as a current asset in the accompanying balance sheets at March 31, 2009 and December 31, 2008. </font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">The estimated value of the Company&rsquo;s FIN 48 tax positions at March 31, 2009 is a liability of $498,000. There were no changes to this amount during the three-month period ended March 31, 2009. If the Company&rsquo;s tax positions are sustained by the taxing authorities in favor of the Company, the Company&rsquo;s FIN 48 liability would be reduced by $498,000, of which $307,000 would impact the
        Company&rsquo;s tax provision. On a quarterly basis the Company evaluates its tax positions and revises its estimates accordingly. The Company believes that $342,000 of its tax positions will be resolved within the next twelve months. </font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">The Company has identified Federal, California, Massachusetts, New York and New Jersey as &ldquo;major&rdquo; tax jurisdictions. The periods subject to examination for the Company&rsquo;s Federal returns are years 2006 and 2007. The periods subject to examination for the Company&rsquo;s California, Massachusetts, New York and New Jersey returns are years 2005, 2006 and 2007.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">The Company&rsquo;s policy for recording interest and penalties is to record such items as a component of income taxes. Interest and penalties were not material to the Company&rsquo;s financial position, results of operations or cash flows as of and for the three months ended March 31, 2009 and 2008. </font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><b><font size="2">NOTE K &mdash; BUSINESS SEGMENTS</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">The Company operates in two reportable business segments; the wholesale segment which is the Company&rsquo;s primary business that designs, markets and distributes its products to retailers and distributors, and the direct-to-consumer segment, through its Pfaltzgraff&reg; and Mikasa&reg; Internet websites and the Company&rsquo;s Pfaltzgraff&reg; mail-order catalogs. As described in Note B, the Company
        ceased operating its Pfaltzgraff&reg; factory and clearance stores and Farberware&reg; outlet stores by December 31, 2008. The results of operations of certain of these stores were included in the direct-to-consumer segment during the three months ended March 31, 2008.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">The Company has segmented its operations in a manner that reflects how management reviews and evaluates the results of its operations. While both segments distribute similar products, the segments are distinct due to their different types of customers and the different methods used to sell, market and distribute the products. </font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <div title="EE+ Page Footer">
            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"></p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><font size="2">-15-</font></p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"></p>
        </div>

        <div title="EE+ Page Break" style="FONT-SIZE: 1pt; PAGE-BREAK-AFTER: always; WIDTH: 100%; HEIGHT: 1px">
            <hr align="center" width="100%" noshade size="2">
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><b><font size="2">LIFETIME BRANDS, INC.</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><b><font size="2">NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><b><font size="2">March 31, 2009</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><font size="2">(unaudited)</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><b><font size="2">NOTE K &mdash; BUSINESS SEGMENTS (continued)</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">Management evaluates the performance of the wholesale and direct-to-consumer segments based on net sales and income (loss) from operations. Such measures give recognition to specifically identifiable operating costs such as cost of sales, distribution expenses and selling, general and administrative expenses. Certain general and administrative expenses, such as senior executive salaries and benefits,
        stock compensation, director fees and accounting, legal and consulting fees, are not allocated to the specific segments and are reflected as unallocated corporate expenses. </font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"></p>

        <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="80%" border="0">
            <tr style="page-break-inside: avoid">
                <td valign="bottom" width="548">
                    <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                </td>

                <td valign="bottom" width="42">
                    <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>

                <td style="BORDER-BOTTOM: black 1pt solid" valign="bottom" colspan="5">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">Three Months Ended</font></b><br>
                    <b><font size="2">March 31,</font></b></p>
                </td>

                <td valign="bottom" width="2%">
                    <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>
            </tr>

            <tr style="page-break-inside: avoid" bgcolor="#cceeff">
                <td valign="bottom" width="548">
                    <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                </td>

                <td valign="bottom" width="42">
                    <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>

                <td style="BORDER-BOTTOM: black 1pt solid" valign="bottom" colspan="2">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">2009</font></b></p>
                </td>

                <td style="BORDER-BOTTOM: black 1pt solid" valign="bottom" width="19">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>

                <td style="BORDER-RIGHT: medium none; BORDER-TOP: black 1pt solid; BORDER-LEFT: medium none; BORDER-BOTTOM: black 1pt solid" valign="bottom" colspan="2">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">2008</font></b></p>
                </td>

                <td valign="bottom" width="2%">
                    <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>
            </tr>

            <tr style="page-break-inside: avoid">
                <td valign="bottom" width="548">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                </td>

                <td valign="bottom" width="42">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>

                <td valign="bottom" colspan="5">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font size="2">(in thousands)</font></p>
                </td>

                <td valign="bottom" width="2%">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>
            </tr>

            <tr style="page-break-inside: avoid" bgcolor="#cceeff">
                <td valign="bottom" width="548">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0.25in; TEXT-INDENT: -0.25in; TEXT-ALIGN: left"><b><font size="2">Net sales</font></b></p>
                </td>

                <td valign="bottom" width="42">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>

                <td valign="bottom" width="69">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                </td>

                <td valign="bottom" width="73">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                </td>

                <td valign="bottom" width="19">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>

                <td valign="bottom" width="68">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                </td>

                <td valign="bottom" width="6%">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                </td>

                <td valign="bottom" width="2%">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>
            </tr>

            <tr style="page-break-inside: avoid">
                <td valign="bottom" width="548">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 22pt; TEXT-INDENT: -0.25in; TEXT-ALIGN: left"><font size="2">Wholesale</font></p>
                </td>

                <td valign="bottom" width="42">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>

                <td valign="bottom" width="69">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt" align="right"><font size="2">$</font></p>
                </td>

                <td valign="bottom" width="73">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">83,606 </font></p>
                </td>

                <td valign="bottom" width="19">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>

                <td valign="bottom" width="68">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt" align="right"><font size="2">$</font></p>
                </td>

                <td valign="bottom" width="6%">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">80,378</font></p>
                </td>

                <td valign="bottom" width="2%">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>
            </tr>

            <tr style="page-break-inside: avoid" bgcolor="#cceeff">
                <td valign="bottom" width="548">
                    <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 22pt; TEXT-INDENT: -0.25in; TEXT-ALIGN: left"><font size="2">Direct-to-consumer</font></p>
                </td>

                <td valign="bottom" width="42">
                    <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>

                <td style="BORDER-BOTTOM: black 1pt solid" valign="bottom" width="69">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                </td>

                <td style="BORDER-BOTTOM: black 1pt solid" valign="bottom" width="73">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">6,608</font></p>
                </td>

                <td valign="bottom" width="19">
                    <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>

                <td style="BORDER-BOTTOM: black 1pt solid" valign="bottom" width="68">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                </td>

                <td style="BORDER-BOTTOM: black 1pt solid" valign="bottom" width="6%">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">17,816</font></p>
                </td>

                <td valign="bottom" width="2%">
                    <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>
            </tr>

            <tr style="page-break-inside: avoid">
                <td valign="bottom" width="548">
                    <p style="MARGIN-TOP: 1.5pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 47.5pt; TEXT-INDENT: -0.25in; TEXT-ALIGN: left"><font size="2">Total net sales</font></p>
                </td>

                <td valign="bottom" width="42">
                    <p style="MARGIN-TOP: 1.5pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>

                <td style="BORDER-BOTTOM: black 2.25pt double" valign="bottom" width="69">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt" align="right"><font size="2">$</font></p>
                </td>

                <td style="BORDER-BOTTOM: black 2.25pt double" valign="bottom" width="73">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">90,214</font></p>
                </td>

                <td valign="bottom" width="19">
                    <p style="MARGIN-TOP: 1.5pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>

                <td style="BORDER-BOTTOM: black 2.25pt double" valign="bottom" width="68">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt" align="right"><font size="2">$</font></p>
                </td>

                <td style="BORDER-BOTTOM: black 2.25pt double" valign="bottom" width="6%">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">98,194</font></p>
                </td>

                <td valign="bottom" width="2%">
                    <p style="MARGIN-TOP: 1.5pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>
            </tr>

            <tr style="page-break-inside: avoid" bgcolor="#cceeff">
                <td valign="bottom" width="548">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0.25in; TEXT-INDENT: -0.25in; TEXT-ALIGN: left">&nbsp;</p>
                </td>

                <td valign="bottom" width="42">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>

                <td valign="bottom" width="69">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                </td>

                <td valign="bottom" width="73">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                </td>

                <td valign="bottom" width="19">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>

                <td valign="bottom" width="68">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                </td>

                <td valign="bottom" width="6%">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                </td>

                <td valign="bottom" width="2%">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>
            </tr>

            <tr style="page-break-inside: avoid">
                <td valign="bottom" width="548">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0.25in; TEXT-INDENT: -0.25in; TEXT-ALIGN: left"><b><font size="2">Income (loss) from operations</font></b></p>
                </td>

                <td valign="bottom" width="42">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>

                <td valign="bottom" width="69">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                </td>

                <td valign="bottom" width="73">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                </td>

                <td valign="bottom" width="19">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>

                <td valign="bottom" width="68">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                </td>

                <td valign="bottom" width="6%">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                </td>

                <td valign="bottom" width="2%">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>
            </tr>

            <tr style="page-break-inside: avoid" bgcolor="#cceeff">
                <td valign="bottom" width="548">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 22pt; TEXT-INDENT: -0.25in; TEXT-ALIGN: left"><font size="2">Wholesale</font></p>
                </td>

                <td valign="bottom" width="42">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>

                <td valign="bottom" align="right" width="69">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt"><font size="2">$</font></p>
                </td>

                <td valign="bottom" width="73">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">824</font></p>
                </td>

                <td valign="bottom" width="19">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>

                <td valign="bottom" width="68">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt" align="right"><font size="2">$</font></p>
                </td>

                <td valign="bottom" width="6%">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">345</font></p>
                </td>

                <td valign="bottom" width="2%">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>
            </tr>

            <tr style="page-break-inside: avoid">
                <td valign="bottom" width="548">
                    <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 22pt; TEXT-INDENT: -0.25in; TEXT-ALIGN: left" align="left"><font size="2">Direct-to-consumer (includes restructuring expenses of $824 in 2009 and $2,880 in 2008)(1)</font></p>
                </td>

                <td valign="bottom" width="42">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>

                <td valign="bottom" width="69">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                </td>

                <td valign="bottom" width="73">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">(1,500</font></p>
                </td>

                <td valign="bottom" width="19">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">)</font></p>
                </td>

                <td valign="bottom" width="68">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                </td>

                <td valign="bottom" width="6%">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">(6,525</font></p>
                </td>

                <td valign="bottom" width="2%">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">)</font></p>
                </td>
            </tr>

            <tr style="page-break-inside: avoid" bgcolor="#cceeff">
                <td valign="bottom" width="548">
                    <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 22pt; TEXT-INDENT: -0.25in; TEXT-ALIGN: left"><font size="2">Unallocated corporate expenses</font></p>
                </td>

                <td valign="bottom" width="42">
                    <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>

                <td style="BORDER-BOTTOM: black 1pt solid" valign="bottom" width="69">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                </td>

                <td style="BORDER-BOTTOM: black 1pt solid" valign="bottom" width="73">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">(2,697</font></p>
                </td>

                <td valign="bottom" width="19">
                    <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">)</font></p>
                </td>

                <td style="BORDER-BOTTOM: black 1pt solid" valign="bottom" width="68">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                </td>

                <td style="BORDER-BOTTOM: black 1pt solid" valign="bottom" width="6%">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">(2,604</font></p>
                </td>

                <td valign="bottom" width="2%">
                    <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">)</font></p>
                </td>
            </tr>

            <tr style="page-break-inside: avoid">
                <td valign="bottom" width="548">
                    <p style="MARGIN-TOP: 1.5pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 47.5pt; TEXT-INDENT: -0.25in; TEXT-ALIGN: left"><font size="2">Total loss from operations</font></p>
                </td>

                <td valign="bottom" width="42">
                    <p style="MARGIN-TOP: 1.5pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>

                <td style="BORDER-BOTTOM: black 2.25pt double" valign="bottom" align="right" width="69">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt"><font size="2">$</font></p>
                </td>

                <td style="BORDER-BOTTOM: black 2.25pt double" valign="bottom" width="73">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 2.25pt; TEXT-ALIGN: right"><font size="2">(3,373 </font></p>
                </td>

                <td style="BORDER-BOTTOM: white 2.25pt double" valign="bottom" width="19">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">)</font></p>
                </td>

                <td style="BORDER-BOTTOM: black 2.25pt double" valign="bottom" width="68">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt" align="right"><font size="2">$</font></p>
                </td>

                <td style="BORDER-BOTTOM: black 2.25pt double" valign="bottom" width="6%">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 2.25pt; TEXT-ALIGN: right"><font size="2">(8,784</font></p>
                </td>

                <td style="BORDER-BOTTOM: white 2.25pt double" valign="bottom" width="2%">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">)</font></p>
                </td>
            </tr>

            <tr style="page-break-inside: avoid" bgcolor="#cceeff">
                <td valign="bottom" width="548">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0.25in; TEXT-INDENT: -0.25in; TEXT-ALIGN: left">&nbsp;</p>
                </td>

                <td valign="bottom" width="42">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>

                <td valign="bottom" width="69">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                </td>

                <td valign="bottom" width="73">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                </td>

                <td valign="bottom" width="19">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>

                <td valign="bottom" width="68">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                </td>

                <td valign="bottom" width="6%">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                </td>

                <td valign="bottom" width="2%">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>
            </tr>

            <tr style="page-break-inside: avoid">
                <td valign="bottom" width="548">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0.25in; TEXT-INDENT: -0.25in; TEXT-ALIGN: left"><b><font size="2">Depreciation and amortization</font></b></p>
                </td>

                <td valign="bottom" width="42">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>

                <td valign="bottom" width="69">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                </td>

                <td valign="bottom" width="73">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                </td>

                <td valign="bottom" width="19">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>

                <td valign="bottom" width="68">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                </td>

                <td valign="bottom" width="6%">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                </td>

                <td valign="bottom" width="2%">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>
            </tr>

            <tr style="page-break-inside: avoid" bgcolor="#cceeff">
                <td valign="bottom" width="548">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 22pt; TEXT-INDENT: -0.25in; TEXT-ALIGN: left"><font size="2">Wholesale</font></p>
                </td>

                <td valign="bottom" width="42">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>

                <td valign="bottom" width="69">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt" align="right"><font size="2">$</font></p>
                </td>

                <td valign="bottom" width="73">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">(2,626</font></p>
                </td>

                <td valign="bottom" width="19">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">)</font></p>
                </td>

                <td valign="bottom" width="68">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt" align="right"><font size="2">$</font></p>
                </td>

                <td valign="bottom" width="6%">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 2.25pt; TEXT-ALIGN: right"><font size="2">(2,407</font></p>
                </td>

                <td valign="bottom" width="2%">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">)</font></p>
                </td>
            </tr>

            <tr style="page-break-inside: avoid">
                <td valign="bottom" width="548">
                    <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 22pt; TEXT-INDENT: -0.25in; TEXT-ALIGN: left"><font size="2">Direct-to-consumer</font></p>
                </td>

                <td valign="bottom" width="42">
                    <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>

                <td style="BORDER-BOTTOM: black 1pt solid" valign="bottom" width="69">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                </td>

                <td style="BORDER-BOTTOM: black 1pt solid" valign="bottom" width="73">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">(52</font></p>
                </td>

                <td valign="bottom" width="19">
                    <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">)</font></p>
                </td>

                <td style="BORDER-BOTTOM: black 1pt solid" valign="bottom" width="68">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                </td>

                <td style="BORDER-BOTTOM: black 1pt solid" valign="bottom" width="6%">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">(223</font></p>
                </td>

                <td valign="bottom" width="2%">
                    <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">)</font></p>
                </td>
            </tr>

            <tr style="page-break-inside: avoid" bgcolor="#cceeff">
                <td valign="bottom" width="548">
                    <p style="MARGIN-TOP: 1.5pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 47.5pt; TEXT-INDENT: -0.25in; TEXT-ALIGN: left"><font size="2">Total depreciation and amortization</font></p>
                </td>

                <td valign="bottom" width="42">
                    <p style="MARGIN-TOP: 1.5pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                </td>

                <td style="BORDER-BOTTOM: black 2.25pt double" valign="bottom" width="69">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt" align="right"><font size="2">$</font></p>
                </td>

                <td style="BORDER-BOTTOM: black 2.25pt double" valign="bottom" width="73">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">(2,678</font></p>
                </td>

                <td style="BORDER-BOTTOM: white 2.25pt double" valign="bottom" width="19">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">)</font></p>
                </td>

                <td style="BORDER-BOTTOM: black 2.25pt double" valign="bottom" width="68">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt" align="right"><font size="2">$</font></p>
                </td>

                <td style="BORDER-BOTTOM: black 2.25pt double" valign="bottom" width="6%">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 2.25pt; TEXT-ALIGN: right"><font size="2">(2,630</font></p>
                </td>

                <td style="BORDER-BOTTOM: white 2.25pt double" valign="bottom" width="2%">
                    <p style="MARGIN-TOP: 2pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">)</font></p>
                </td>
            </tr>
        </table>
        <br>
        <br>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><font size="2">Note:</font></p>

        <div align="left">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
                <tr>
                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">(1)</font></p>
                    </td>

                    <td valign="top">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify"><font size="2">Loss from operations for the Direct-to-consumer segment for the three months ended March 31, 2009 and 2008 includes $824,000 and $2.9 million of restructuring expenses, respectively. See Note B. </font></p>
                    </td>
                </tr>
            </table>
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 3.85%; TEXT-INDENT: -3.85%; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><b><font size="2">NOTE L </font></b><font size="2">&mdash;</font><b><font size="2">CONTINGENCIES</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">The Company is a defendant in various lawsuits and from time-to-time regulatory proceedings which may require the recall of its products, arising in the ordinary course of its business. Management does not expect the outcome of any of these matters, individually or collectively, to have a material adverse effect on the Company&rsquo;s financial condition. </font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">In October 2007, Syratech Corporation (&ldquo;Syratech&rdquo;) commenced an action against the Company and the Company&rsquo;s wholly-owned subsidiary, Syratech Acquisition Corporation, in New York State Supreme Court, New York County, asserting a single cause of action for breach of contract. Syratech alleges that the Company breached the parties&rsquo; asset purchase agreement by failing to file and
        make effective a registration statement for shares of the Company&rsquo;s common stock issued to Syratech for its assets. The complaint alleges damages of approximately $2.1 million. The Company denies that it is liable to Syratech under the claim set forward in the complaint, and intends to vigorously defend this action. No trial date has been set. </font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <div title="EE+ Page Footer">
            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"></p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><font size="2">-16-</font></p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"></p>
        </div>

        <div title="EE+ Page Break" style="FONT-SIZE: 1pt; PAGE-BREAK-AFTER: always; WIDTH: 100%; HEIGHT: 1px">
            <hr align="center" width="100%" noshade size="2">
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><b><font size="2">LIFETIME BRANDS, INC.</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><b><font size="2">NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><b><font size="2">March 31, 2009</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><font size="2">(unaudited)</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><b><font size="2">NOTE L </font></b><font size="2">&mdash; </font><b><font size="2">CONTINGENCIES (continued)</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">In March 2008, the Environmental Protection Agency (&ldquo;EPA&rdquo;) announced that the San German Ground Water Contamination site in Puerto Rico was added to the Superfund National Priorities List due to contamination present in the local drinking water supply. Wallace Silversmiths de Puerto Rico, Ltd. (&ldquo;Wallace&rdquo;), a wholly-owned subsidiary of the Company, received a Notice of Potential
        Liability and Request for Information Pursuant to 42 U.S.C. Sections 9607(a) and 9604(e) of the Comprehensive Environmental Response, Compensation, Liability Act regarding the San German Ground Water Contamination Superfund Site, San German, Puerto Rico dated May 29, 2008 from the EPA. The EPA requested that Wallace provide information regarding Wallace&rsquo;s occupation of the facility located in San German, Puerto Rico and contamination of the ground water supply. By letter dated
        June 18, 2008, the Company responded to the EPA&rsquo;s Request for Information on behalf of Wallace. The Company has engaged environmental consultants to investigate the environmental condition of the property and preliminary discussions with the EPA have been initiated. At this time, it is not possible for the Company to evaluate the outcome.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><b><font size="2">NOTE M </font></b><font size="2">&mdash; </font><b><font size="2">OTHER </font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><b><font size="2">Dividends</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><font size="2">In February 2009, the Company suspended paying a cash dividend on its outstanding shares of common stock. </font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><b><font size="2">Supplemental cash flow information</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <div align="left">
            <table style="MARGIN-LEFT: 18.9pt; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="80%" border="0">
                <tr style="page-break-inside: avoid">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="68%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="top" colspan="3">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">Three Months Ended</font></b><br>
                        <b><font size="2">March 31,</font></b></p>
                    </td>
                </tr>

                <tr style="page-break-inside: avoid">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="68%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="top" width="13%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">2009</font></b></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="3%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="top" width="13%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">2008</font></b></p>
                    </td>
                </tr>

                <tr style="HEIGHT: 12.25pt; page-break-inside: avoid">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 12.25pt" valign="top" width="68%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 12.25pt" valign="top" colspan="3">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font size="2">(in thousands)</font></p>
                    </td>
                </tr>

                <tr style="HEIGHT: 12.25pt; page-break-inside: avoid" bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 12.25pt" valign="top" width="68%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><b><font size="2">Supplemental disclosure of cash flow information:</font></b></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 12.25pt" valign="top" colspan="3">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>
                </tr>

                <tr style="page-break-inside: avoid">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="68%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Cash paid for interest</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="13%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 17.25pt; TEXT-ALIGN: center" align="center"><font size="2">$3,040</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="13%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 17.25pt; TEXT-ALIGN: center"><font size="2">$ 2,891&nbsp;&nbsp; </font></p>
                    </td>
                </tr>

                <tr style="page-break-inside: avoid" bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="68%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Cash paid for taxes </font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="13%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 17.25pt; TEXT-ALIGN: center" align="center"><font size="2">&nbsp;&nbsp;&nbsp; 154</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="13%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 17.25pt; TEXT-ALIGN: center"><font size="2">&nbsp;3,706&nbsp; </font></p>
                    </td>
                </tr>

                <tr style="HEIGHT: 0.1in; page-break-inside: avoid">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 0.1in" valign="top" width="68%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 7.3pt; TEXT-INDENT: -7.3pt; LINE-HEIGHT: normal; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 0.1in" valign="top" width="13%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 0.1in" valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 0.1in" valign="top" width="13%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>
                </tr>

                <tr style="page-break-inside: avoid" bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="68%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 8.05pt; TEXT-INDENT: -8.05pt; TEXT-ALIGN: left"><b><font size="2">Non-cash investing activities:</font></b></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="13%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="13%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>
                </tr>

                <tr style="page-break-inside: avoid">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="68%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 8.05pt; TEXT-INDENT: -8.05pt; TEXT-ALIGN: left"><font size="2">Grupo Vasconia, S.A.B. translation adjustment</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="13%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 17.25pt; TEXT-ALIGN: center"><font size="2">$&nbsp; &nbsp;849</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="13%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 17.25pt; TEXT-ALIGN: center"><font size="2">&nbsp;&nbsp; &#8213;</font></p>
                    </td>
                </tr>
            </table>
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><b><font size="2">Comprehensive loss </font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <div align="left">
            <table style="MARGIN-LEFT: 18.9pt; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="80%" border="0">
                <tr style="page-break-inside: avoid">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="68%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="top" colspan="3">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">Three Months Ended</font></b><br>
                        <b><font size="2">March 31,</font></b></p>
                    </td>
                </tr>

                <tr style="page-break-inside: avoid">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="68%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="top" width="13%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">2009</font></b></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="3%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="top" width="13%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">2008</font></b></p>
                    </td>
                </tr>

                <tr style="page-break-inside: avoid">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="68%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" colspan="3">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><font size="2">(in thousands)</font></p>
                    </td>
                </tr>

                <tr style="HEIGHT: 12.25pt; page-break-inside: avoid" bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 12.25pt" valign="top" width="68%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><b><font size="2">Net loss</font></b></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 12.25pt" valign="top" width="13%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 17.25pt; TEXT-ALIGN: center"><font size="2">$(5,959)</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 12.25pt" valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 12.25pt" valign="top" width="13%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 17.25pt; TEXT-ALIGN: center"><font size="2">$(6,357)</font></p>
                    </td>
                </tr>

                <tr style="page-break-inside: avoid">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="68%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 8.1pt; TEXT-INDENT: -8.1pt; TEXT-ALIGN: left"><font size="2">Derivative fair value adjustment, net of taxes of $47 and $584 for the periods ended 2009 and 2008, respectively</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="13%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 17.25pt; TEXT-ALIGN: center"><font size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 75</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="13%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 17.25pt; TEXT-ALIGN: center"><font size="2">&nbsp;&nbsp;&nbsp;&nbsp; (789)</font></p>
                    </td>
                </tr>

                <tr style="page-break-inside: avoid" bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="68%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 8.05pt; TEXT-INDENT: -8.05pt; TEXT-ALIGN: left"><font size="2">Grupo Vasconia, S.A.B. translation adjustment</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="bottom" width="13%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 17.25pt; TEXT-ALIGN: center"><font size="2">&nbsp;&nbsp;&nbsp; (849)</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="3%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="top" width="13%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 17.25pt; TEXT-ALIGN: center"><font size="2">&nbsp;&nbsp;&nbsp; &nbsp; &#8213;</font></p>
                    </td>
                </tr>

                <tr style="page-break-inside: avoid">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="68%">
                        <p style="MARGIN-TOP: 1.5pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 8.05pt; TEXT-INDENT: -8.05pt; TEXT-ALIGN: left"><b><font size="2">Total comprehensive loss</font></b></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 2.25pt double" valign="top" width="13%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 17.25pt; TEXT-ALIGN: center"><font size="2">$(6,733)</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="3%">
                        <p style="MARGIN-TOP: 1.5pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 2.25pt double" valign="top" width="13%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 17.25pt; TEXT-ALIGN: center"><font size="2">$(7,146)</font></p>
                    </td>
                </tr>
            </table>
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <div title="EE+ Page Footer">
            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"></p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><font size="2">-17-</font></p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"></p>
        </div>

        <div title="EE+ Page Break" style="FONT-SIZE: 1pt; PAGE-BREAK-AFTER: always; WIDTH: 100%; HEIGHT: 1px">
            <hr align="center" width="100%" noshade size="2">
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><b><font size="2"><a name="report"><b><font size="2">Report </font></b></a>of Independent Registered Public Accounting Firm</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><font size="2">To the Board of Directors and Stockholders of Lifetime Brands, Inc:</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">We have reviewed the condensed consolidated balance sheet of Lifetime Brands, Inc. and subsidiaries (the &ldquo;Company&rdquo;) as of March 31, 2009, and the related condensed consolidated statements of operations for the three-month periods ended March 31, 2009 and 2008, and the condensed consolidated statements of cash flows for the three-month periods ended March 31, 2009 and 2008. These financial
        statements are the responsibility of the Company's management.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">We conducted our review in accordance with the standards of the Public Company Accounting Oversight Board (United States). A review of interim financial information consists principally of applying analytical procedures and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with the standards of the Public
        Company Accounting Oversight Board, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">Based on our review, we are not aware of any material modifications that should be made to the condensed consolidated financial statements referred to above for them to be in conformity with US generally accepted accounting principles.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">We have previously audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated balance sheet of the Company and subsidiaries as of December 31, 2008, and the related consolidated statements of operations, shareholders' equity, and cash flows for the year then ended and in our report dated March 31, 2009, we expressed an unqualified opinion
        on those consolidated financial statements. The consolidated balance sheet of Grupo Vasconia, S.A.B. and Subsidiaries (a corporation in which the Company has a 29.99% interest) as of December 31, 2008, and the related consolidated statements of income, shareholders' equity, and cash flows for the year then ended (not presented herein) were audited by other auditors whose report dated March 9, 2009 expressed an unqualified opinion on those statements. In the consolidated financial
        statements, the Company&rsquo;s investment in Grupo Vasconia, S.A.B. and Subsidiaries is stated at $17.8 million at December 31, 2008 and the Company&rsquo;s equity in the net income of Grupo Vasconia, S.A.B. and Subsidiaries is stated at $1.5 million for the year then ended. As described in Note F, on January 1, 2009, the Company adopted the provisions of FASB Staff Position Accounting Principles Board No. 14-1 (&ldquo;FSP APB 14-1&rdquo;) on a retrospective basis resulting in revision
        of the December 31, 2008 consolidated balance sheet. We have not audited and reported on the revised December 31, 2008 balance sheet reflecting the adoption of FSP APB 14-1.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 61.54%; TEXT-ALIGN: left"><font size="2">/s/ ERNST &amp; YOUNG LLP</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">Melville, New York</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">May 11, 2009</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <div title="EE+ Page Footer">
            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"></p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><font size="2">-18-</font></p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"></p>
        </div>

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            <hr align="center" width="100%" noshade size="2">
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><b><font size="2"><a name="p1item2"><b><font size="2">ITEM 2</font></b></a>. <b><font size="2">MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS</font></b></font></b></p>

        <div align="left">
            &nbsp;
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">This Quarterly Report on Form 10-Q contains &ldquo;forward-looking statements&rdquo; as defined by the Private Securities Litigation Reform Act of 1995. These forward-looking statements include information concerning Lifetime Brands, Inc.&rsquo;s (the &ldquo;Company&rsquo;s&rdquo;) plans, objectives, goals, strategies, future events, future revenues, performance, capital expenditures, financing needs and
        other information that is not historical information. Many of these statements appear, in particular, in </font><i><font size="2">Management's Discussion and Analysis of Financial Condition and Results of Operations.</font></i> <font size="2">When used in this Quarterly Report on Form 10-Q, the words &ldquo;estimates,&rdquo; &ldquo;expects,&rdquo; &ldquo;anticipates,&rdquo; &ldquo;projects,&rdquo; &ldquo;plans,&rdquo; &ldquo;intends,&rdquo; &ldquo;believes&rdquo; and variations of such
        words or similar expressions are intended to identify forward-looking statements. All forward-looking statements, including, without limitation, the Company&rsquo;s examination of historical operating trends, are based upon the Company&rsquo;s current expectations and various assumptions. The Company believes there is a reasonable basis for its expectations and assumptions, but there can be no assurance that the Company will realize its expectations or that the Company&rsquo;s
        assumptions will prove correct.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">There are a number of risks and uncertainties that could cause the Company&rsquo;s actual results to differ materially from the forward-looking statements contained in this Quarterly Report. Important factors that could cause the Company&rsquo;s actual results to differ materially from those expressed as forward-looking statements are set forth in the Company&rsquo;s 2008 Annual Report on Form 10-K in
        Part I, Item 1A under the heading </font><i><font size="2">Risk Factors</font></i><font size="2">. Such risks, uncertainties and other important factors include, among others:</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <div align="left">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
                <tr>
                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify">&nbsp;</p>
                    </td>

                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="4"><b>&bull;</b></font></p>
                    </td>

                    <td valign="top">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify"><font size="2">Risks associated with indebtedness; </font></p>
                    </td>
                </tr>
            </table>
        </div>

        <div align="left">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
                <tr>
                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify">&nbsp;</p>
                    </td>

                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="4"><b>&bull;</b></font></p>
                    </td>

                    <td valign="top">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify"><font size="2">Changes in general economic and business conditions which could affect customer payment practices or consumer spending;</font></p>
                    </td>
                </tr>
            </table>
        </div>

        <div align="left">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
                <tr>
                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify">&nbsp;</p>
                    </td>

                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="4"><b>&bull;</b></font></p>
                    </td>

                    <td valign="top">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify"><font size="2">Customer risks;</font></p>
                    </td>
                </tr>
            </table>
        </div>

        <div align="left">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
                <tr>
                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify">&nbsp;</p>
                    </td>

                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="4"><b>&bull;</b></font></p>
                    </td>

                    <td valign="top">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify"><font size="2">The Company&rsquo;s dependence on third-party foreign sources of supply and foreign manufacturing;</font></p>
                    </td>
                </tr>
            </table>
        </div>

        <div align="left">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
                <tr>
                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify">&nbsp;</p>
                    </td>

                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="4"><b>&bull;</b></font></p>
                    </td>

                    <td valign="top">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify"><font size="2">Changes in demand for the Company&rsquo;s products and the success of new products;</font></p>
                    </td>
                </tr>
            </table>
        </div>

        <div align="left">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
                <tr>
                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify">&nbsp;</p>
                    </td>

                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="4"><b>&bull;</b></font></p>
                    </td>

                    <td valign="top">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify"><font size="2">The level of competition in the Company&rsquo;s industry;</font></p>
                    </td>
                </tr>
            </table>
        </div>

        <div align="left">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
                <tr>
                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify">&nbsp;</p>
                    </td>

                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="4"><b>&bull;</b></font></p>
                    </td>

                    <td valign="top">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify"><font size="2">Industry trends;</font></p>
                    </td>
                </tr>
            </table>
        </div>

        <div align="left">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
                <tr>
                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify">&nbsp;</p>
                    </td>

                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="4"><b>&bull;</b></font></p>
                    </td>

                    <td valign="top">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify"><font size="2">Fluctuations in costs of raw materials;</font></p>
                    </td>
                </tr>
            </table>
        </div>

        <div align="left">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
                <tr>
                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify">&nbsp;</p>
                    </td>

                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="4"><b>&bull;</b></font></p>
                    </td>

                    <td valign="top">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify"><font size="2">Increases in costs relating to manufacturing and transportation of products;</font></p>
                    </td>
                </tr>
            </table>
        </div>

        <div align="left">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
                <tr>
                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify">&nbsp;</p>
                    </td>

                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="4"><b>&bull;</b></font></p>
                    </td>

                    <td valign="top">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify"><font size="2">Complexities associated with a multi-channel and multi-brand business;</font></p>
                    </td>
                </tr>
            </table>
        </div>

        <div align="left">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
                <tr>
                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify">&nbsp;</p>
                    </td>

                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="4"><b>&bull;</b></font></p>
                    </td>

                    <td valign="top">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify"><font size="2">The Company&rsquo;s relationship with key licensors;</font></p>
                    </td>
                </tr>
            </table>
        </div>

        <div align="left">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
                <tr>
                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify">&nbsp;</p>
                    </td>

                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="4"><b>&bull;</b></font></p>
                    </td>

                    <td valign="top">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify"><font size="2">Encroachments on the Company&rsquo;s intellectual property;</font></p>
                    </td>
                </tr>
            </table>
        </div>

        <div align="left">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
                <tr>
                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify">&nbsp;</p>
                    </td>

                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="4"><b>&bull;</b></font></p>
                    </td>

                    <td valign="top">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify"><font size="2">The Company&rsquo;s relationship with key customers;</font></p>
                    </td>
                </tr>
            </table>
        </div>

        <div align="left">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
                <tr>
                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify">&nbsp;</p>
                    </td>

                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="4"><b>&bull;</b></font></p>
                    </td>

                    <td valign="top">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify"><font size="2">Product liability claims or product recalls;</font></p>
                    </td>
                </tr>
            </table>
        </div>

        <div align="left">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
                <tr>
                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify">&nbsp;</p>
                    </td>

                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="4"><b>&bull;</b></font></p>
                    </td>

                    <td valign="top">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify"><font size="2">The timing of delivery of products to customers;</font></p>
                    </td>
                </tr>
            </table>
        </div>

        <div align="left">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
                <tr>
                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify">&nbsp;</p>
                    </td>

                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="4"><b>&bull;</b></font></p>
                    </td>

                    <td valign="top">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify"><font size="2">Departure of key personnel;</font></p>
                    </td>
                </tr>
            </table>
        </div>

        <div align="left">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
                <tr>
                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify">&nbsp;</p>
                    </td>

                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="4"><b>&bull;</b></font></p>
                    </td>

                    <td valign="top">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify"><font size="2">Internal development of products by the Company&rsquo;s customers;</font></p>
                    </td>
                </tr>
            </table>
        </div>

        <div align="left">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
                <tr>
                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify">&nbsp;</p>
                    </td>

                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="4"><b>&bull;</b></font></p>
                    </td>

                    <td valign="top">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify"><font size="2">Noncompliance with applicable regulations including the Sarbanes-Oxley Act of 2002;</font></p>
                    </td>
                </tr>
            </table>
        </div>

        <div align="left">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
                <tr>
                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify">&nbsp;</p>
                    </td>

                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="4"><b>&bull;</b></font></p>
                    </td>

                    <td valign="top">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify"><font size="2">Risks associated with the Company&rsquo;s Internet operations; </font></p>
                    </td>
                </tr>
            </table>
        </div>

        <div align="left">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
                <tr>
                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify">&nbsp;</p>
                    </td>

                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="4"><b>&bull;</b></font></p>
                    </td>

                    <td valign="top">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify"><font size="2">Future acquisitions and integration of acquired businesses;</font></p>
                    </td>
                </tr>
            </table>
        </div>

        <div align="left">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
                <tr>
                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify">&nbsp;</p>
                    </td>

                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="4"><b>&bull;</b></font></p>
                    </td>

                    <td valign="top">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify"><font size="2">Technological risks; </font></p>
                    </td>
                </tr>
            </table>
        </div>

        <div align="left">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
                <tr>
                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify">&nbsp;</p>
                    </td>

                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="4"><b>&bull;</b></font></p>
                    </td>

                    <td valign="top">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify"><font size="2">Network security risks; and</font></p>
                    </td>
                </tr>
            </table>
        </div>

        <div align="left">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
                <tr>
                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify">&nbsp;</p>
                    </td>

                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="4"><b>&bull;</b></font></p>
                    </td>

                    <td valign="top">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify"><font size="2">The seasonal nature of the Company&rsquo;s business.</font></p>
                    </td>
                </tr>
            </table>
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">There may be other factors that may cause the Company&rsquo;s actual results to differ materially from the forward-looking statements. Except as may be required by law, the Company undertakes no obligation to publicly update or revise forward-looking statements which may be made to reflect events or circumstances after the date made or to reflect the occurrence of unanticipated events.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <div title="EE+ Page Footer">
            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"></p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><font size="2">-19-</font></p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"></p>
        </div>

        <div title="EE+ Page Break" style="FONT-SIZE: 1pt; PAGE-BREAK-AFTER: always; WIDTH: 100%; HEIGHT: 1px">
            <hr align="center" width="100%" noshade size="2">
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><b><font size="2">ABOUT THE COMPANY</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">The Company is one of North America&rsquo;s leading resources for nationally branded food preparation, tabletop and home d&eacute;cor products. The Company&rsquo;s three major product categories are Food Preparation, Tabletop and Home D&eacute;cor. The Company markets several product lines within each of these product categories and under each of the Company&rsquo;s brands, primarily targeting moderate to
        premium price points, through every major level of trade. The Company&rsquo;s competitive advantage is based on availability and use of its brands, an emphasis on innovation and new product development and sourcing capabilities. The Company owns or licenses a number of the leading brands in its industry including Farberware&reg;, KitchenAid&reg;, Cuisinart&reg;, Pfaltzgraff&reg; and Mikasa&reg;. Historically, the Company&rsquo;s sales growth has come from expanding product offerings
        within the Company&rsquo;s current categories by developing existing brands, and acquiring new brands and product categories. Key factors in the Company&rsquo;s growth strategy have been, and will continue to be, the selective use and management of the Company&rsquo;s brands, and the Company&rsquo;s ability to provide a stream of new products and designs. A significant element of this strategy is the Company&rsquo;s in-house design and development team that creates new products,
        packaging and merchandising concepts. </font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><b><font size="2">EFFECTS OF THE CURRENT ECONOMIC ENVIRONMENT</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">The Company&rsquo;s financial performance in 2008 was negatively affected by unfavorable global economic conditions. Continued or further deteriorating economic conditions would likely have an adverse impact on the Company&rsquo;s sales volumes, pricing levels and profitability in 2009. As economic conditions change, trends in discretionary consumer spending also become unpredictable and subject to
        reductions due to uncertainties about the future. If consumers reduce discretionary spending, purchases of the Company&rsquo;s products may also decline. A general reduction in consumer discretionary spending due to the recession or uncertainties regarding future economic prospects could continue to have a material adverse effect on the Company&rsquo;s financial condition and results of operations. </font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><b><font size="2">2009 INFLUENZA OUTBREAK</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">In April 2009, public health authorities reported an outbreak of influenza that has the potential to become pandemic. A severe and prolonged outbreak may have a significant negative effect on overall economic activity, including the demand for the Company&rsquo;s products. In response to such an outbreak, public health authorities may recommend that people stay at home or call for employers to close
        facilities. Significant absenteeism or closing the Company&rsquo;s facilities would have an adverse effect on the Company&rsquo;s business. The Company is unable to predict whether such events will occur or the magnitude of the effect they may have on the Company&rsquo;s business.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><b><font size="2">BUSINESS SEGMENTS</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">The Company operates in two reportable business segments; the wholesale segment which is the Company&rsquo;s primary business that designs, markets and distributes its products to retailers and distributors, and the direct-to-consumer segment, through its Pfaltzgraff&reg; and Mikasa&reg; Internet websites and the Company&rsquo;s Pfaltzgraff&reg; mail-order catalogs. During the 2008 period, the Company
        also operated retail stores utilizing the Pfaltzgraff&reg; and Farberware&reg; names that were included in the direct-to-consumer segment. However, the Company ceased operating these retail stores by December 31, 2008. </font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><b><font size="2">MIKASA</font></b><font size="2">&reg; </font><b><font size="2">ACQUISITION </font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><font size="2">In June 2008, the Company acquired the business and certain assets of Mikasa, Inc. Net sales from Mikasa&reg; during the three months ended March 31, 2009 were $8.3 million.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><b><font size="2">INVESTMENT IN GRUPO VASCONIA, S.A.B. </font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">The Company owns approximately 30% of the capital stock of Grupo Vasconia, S.A.B. (&ldquo;Vasconia&rdquo;), a manufacturer and distributor of aluminum disks, cookware and related items. Shares of Vasconia capital stock are traded on the Bolsa Mexicana de Valores, S.A. de C.V., the Mexico Stock Exchange, under the symbol VASCONI.MX. The Company accounts for its investment in Vasconia using the equity
        method of accounting and has recorded its proportionate share of Vasconia&rsquo;s net income for the three months ended March 31, 2009, net of taxes, as equity in earnings of Grupo Vasconia, S.A.B.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <div title="EE+ Page Footer">
            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"></p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><font size="2">-20-</font></p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"></p>
        </div>

        <div title="EE+ Page Break" style="FONT-SIZE: 1pt; PAGE-BREAK-AFTER: always; WIDTH: 100%; HEIGHT: 1px">
            <hr align="center" width="100%" noshade size="2">
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><b><font size="2">SEASONALITY</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">The Company&rsquo;s business and working capital needs are highly seasonal, with a majority of sales occurring in the third and fourth quarters. In 2008, 2007 and 2006, net sales for the third and fourth quarters accounted for 61%, 61% and 65% of total annual net sales, respectively. In anticipation of the pre-holiday shipping season, inventory levels increase primarily in the June through October time
        period.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><b><font size="2">ADOPTION OF ACCOUNTING PRINCIPLE</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">Effective January 1, 2009, the Company adopted the provisions of FASB Staff Position Accounting Principles Board (&ldquo;APB&rdquo;) No. 14-1, </font><i><font size="2">Accounting for Convertible Debt Instruments That May Be Settled in Cash upon Conversion (Including Partial Cash Settlement) </font></i><font size="2">(&ldquo;FSP APB 14-1&rdquo;) on a retrospective basis. FSP APB 14-1 requires the issuer of
        certain convertible debt instruments that may be settled in cash, or other assets, on conversion (including partial cash settlement), to separately account for the liability (debt) and equity (conversion option) components in a manner that reflects the issuer&rsquo;s non-convertible debt borrowing rate with the resulting debt discount&nbsp;amortized as additional non-cash interest expense over the life of the convertible debt. Accordingly, the accompanying December 31, 2008 condensed
        consolidated balance sheet and March 31, 2008 unaudited condensed consolidated statement of operations and cash flows have been adjusted to reflect the application of the provisions of FSP APB 14-1. </font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><b><font size="2">CRITICAL ACCOUNTING POLICIES AND ESTIMATES</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">Other than the adoption of FSP APB 14-1, </font><i><font size="2">Accounting for Convertible Debt Instruments That May Be Settled in Cash upon Conversion (Including Partial Cash Settlement), </font></i><font size="2">described in Notes A and F to the condensed consolidated financial statements, there have been no material changes to the Company&rsquo;s critical accounting policies and estimates from the
        information provided in Item 7. </font><i><font size="2">Management&rsquo;s Discussion and Analysis of Financial Condition and Results of Operations &ndash; Critical Accounting Policies and Estimates</font></i> <font size="2">included in the Company&rsquo;s Annual Report on Form 10-K dated December 31, 2008.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><b><font size="2">RESULTS OF OPERATIONS </font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">The following table sets forth statement of operations data of the Company as a percentage of net sales for the periods indicated: </font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <div align="left">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="70%" border="0">
                <tr style="page-break-inside: avoid">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="72%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="top" colspan="3">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">Three Months Ended </font></b></p>

                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">March 31, </font></b></p>
                    </td>

                    <td width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>
                </tr>

                <tr style="page-break-inside: avoid" bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="72%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="top" width="12%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">2009</font></b></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; BORDER-TOP: black 1pt solid; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="2%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>

                    <td style="BORDER-RIGHT: medium none; PADDING-RIGHT: 5.4pt; BORDER-TOP: black 1pt solid; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; BORDER-LEFT: medium none; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="top" width="10%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center"><b><font size="2">2008</font></b></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="2%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: center">&nbsp;</p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="72%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Net sales</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="12%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 15pt; TEXT-ALIGN: center"><font size="2">100.0 </font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt" align="left"><font size="2">%</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="10%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 12pt; TEXT-ALIGN: center"><font size="2">100.0&nbsp;</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt" align="left"><font size="2">%</font></p>
                    </td>
                </tr>

                <tr bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 9pt" valign="top" width="72%">&nbsp;&nbsp;</td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 9pt" valign="top" width="12%">
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 9pt" valign="top" width="2%">
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 9pt" valign="top" width="10%">
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 9pt" valign="top" width="2%">
                    </td>
                </tr>

                <tr style="HEIGHT: 9pt; page-break-inside: avoid">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 9pt" valign="top" width="72%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Cost of sales</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 9pt" valign="top" width="12%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 19.5pt; TEXT-ALIGN: center"><font size="2">64.5 </font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 9pt" valign="top" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 9pt" valign="top" width="10%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 12pt; TEXT-ALIGN: center"><font size="2">&nbsp;60.7</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 9pt" valign="top" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>
                </tr>

                <tr style="page-break-inside: avoid" bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="72%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Distribution expenses</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="12%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 19.5pt; TEXT-ALIGN: center"><font size="2">12.2 </font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="10%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 12pt; TEXT-ALIGN: center"><font size="2">&nbsp;13.6</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>
                </tr>

                <tr style="page-break-inside: avoid">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="72%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Selling, general and administrative expenses</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="12%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 19.5pt; TEXT-ALIGN: center"><font size="2">26.1 </font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="10%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 12pt; TEXT-ALIGN: center"><font size="2">&nbsp;31.7</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>
                </tr>

                <tr style="page-break-inside: avoid" bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="72%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Restructuring expenses</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="top" width="12%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 24.75pt; TEXT-ALIGN: center"><font size="2">0.9 </font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="2%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="top" width="10%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 12pt; TEXT-ALIGN: center"><font size="2">&nbsp; &nbsp;2.9</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="2%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="72%">&nbsp;</td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="12%">
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="2%">
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="10%">
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="2%">
                    </td>
                </tr>

                <tr style="page-break-inside: avoid" bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="72%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Loss from operations</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="12%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 24.75pt; TEXT-ALIGN: center"><font size="2">(3.7)</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="10%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 12pt; TEXT-ALIGN: center" align="center"><font size="2">&nbsp;&nbsp;(8.9)</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>
                </tr>

                <tr style="page-break-inside: avoid">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="72%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Interest expense</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="top" width="12%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt" align="center"><font size="2">(3.2)&nbsp;&nbsp; </font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="2%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="top" width="10%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 12pt; TEXT-ALIGN: center"><font size="2">&nbsp; (2.7)</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="2%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>
                </tr>

                <tr style="HEIGHT: 13.9pt; page-break-inside: avoid" bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 13.9pt" valign="top" width="72%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 9pt; TEXT-INDENT: -9pt; TEXT-ALIGN: left"><font size="2">Loss before income taxes and equity in earnings of Grupo Vasconia, S.A.B.</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 13.9pt" valign="top" width="12%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt" align="center"><font size="2">(6.9)&nbsp;&nbsp; </font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 13.9pt" valign="top" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 13.9pt" valign="top" width="10%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 12pt; TEXT-ALIGN: center" align="center"><font size="2">(11.6)</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; HEIGHT: 13.9pt" valign="top" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="72%">&nbsp;</td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="12%">
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="2%">
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="10%">
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="2%">
                    </td>
                </tr>

                <tr style="page-break-inside: avoid" bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="72%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Income tax benefit</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="12%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 24.75pt; TEXT-ALIGN: center"><font size="2">(0.1)</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="10%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 12pt; TEXT-ALIGN: center"><font size="2">&nbsp;&nbsp; 4.9</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="2%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>
                </tr>

                <tr style="page-break-inside: avoid">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="72%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Equity in earnings of Grupo Vasconia, S.A.B.</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="top" width="12%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 30pt" align="center"><font size="2">0.5&nbsp;&nbsp; </font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="2%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 1pt solid" valign="top" width="10%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 12pt; TEXT-ALIGN: center"><font size="2">&nbsp;&nbsp; 0.3</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="2%">
                        <p style="MARGIN-TOP: 1pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: right">&nbsp;</p>
                    </td>
                </tr>

                <tr style="page-break-inside: avoid" bgcolor="#cceeff">
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="72%">
                        <p style="MARGIN-TOP: 1.5pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Net loss</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 2.25pt double" valign="top" width="12%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 24.75pt" align="center"><font size="2">(6.5)</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="2%">
                        <p style="MARGIN-TOP: 1.5pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">%</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 2.25pt double" valign="top" width="10%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 12pt; TEXT-ALIGN: center" align="center"><font size="2">&nbsp; (6.4)</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="2%">
                        <p style="MARGIN-TOP: 1.5pt; MARGIN-BOTTOM: 0in; MARGIN-LEFT: 0in; TEXT-INDENT: 0pt; TEXT-ALIGN: right"><font size="2">%</font></p>
                    </td>
                </tr>
            </table>
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <div title="EE+ Page Footer">
            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"></p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><font size="2">-21-</font></p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"></p>
        </div>

        <div title="EE+ Page Break" style="FONT-SIZE: 1pt; PAGE-BREAK-AFTER: always; WIDTH: 100%; HEIGHT: 1px">
            <hr align="center" width="100%" noshade size="2">
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><b><font size="2">MANAGEMENT&rsquo;S DISCUSSION AND ANALYSIS</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><b><font size="2">THREE MONTHS ENDED MARCH 31, 2009 AS COMPARED TO THE THREE MONTHS ENDED </font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><b><font size="2">MARCH 31, 2008</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><b><font size="2">Net Sales</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">Net sales for the three months ended March 31, 2009 were $90.2 million, a decrease of 8.1% compared to net sales of $98.2 million for the 2008 period.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">Net sales for the wholesale segment for the three months ended March 31, 2009 were $83.6 million, an increase of $3.2 million or 4.0% compared to net sales of $80.4 million for the 2008 period. Excluding Mikasa&reg; net sales of $8.3 million, net sales for the wholesale segment were $75.3 million for the three months ended March 31, 2009. Excluding Mikasa&reg; net sales, the Company experienced a decrease
        primarily in sales volume from its Food preparation product category. The decline reflects the continuing economic weakness and retailers&rsquo; inventory management.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">Net sales for the direct-to-consumer segment for the three months ended March 31, 2009 were $6.6 million compared to $17.8 million for the 2008 period. Excluding sales attributable to the retail stores that the Company closed by the end of 2008, sales for the direct-to-consumer segment in the 2008 period were $6.2 million. The increase in sales for the direct-to-consumer segment in the 2009 period,
        excluding the retail store sales in the 2008 period, was primarily attributable to added sales from the Mikasa&reg; Internet website. The increase was offset, in part, by lower shipping revenue due to a free shipping promotion during the 2009 quarter.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><b><font size="2">Cost of sales</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">Cost of sales for the three months ended March 31, 2009 were $58.1 million compared to $59.6 million for the 2008 period. Cost of sales as a percentage of net sales was 64.5% for the three months ended March 31, 2009 compared to 60.7% for the 2008 period.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">Cost of sales as a percentage of net sales for the wholesale segment was 67.0% for the three months ended March 31, 2009 compared to 63.2% for the 2008 period. The decline in gross margin reflects a shift in product and customer mix. Gross margins during the 2009 period also reflects, in cost of sales, inventory that was purchased during 2008 when commodity and transportation costs were higher than they
        are currently. </font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">Cost of sales as a percentage of net sales for the direct-to-consumer segment decreased to 32.6% for the three months ended March 31, 2009 from 49.3% for the 2008 period. The increase in gross margin was primarily attributable to the low margins that resulted from the going-out-of-business sales during the 2008 period and to a lesser extent higher margins generated by the Mikasa&reg; Internet website in
        the 2009 period. </font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><b><font size="2">Distribution expenses</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">Distribution expenses for the three months ended March 31, 2009 were $11.0 million compared to $13.4 million for the 2008 period. Distribution expenses as a percentage of net sales were 12.2% for the three months ended March 31, 2009 and 13.6% for the 2008 period.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">Distribution expenses as a percentage of net sales for the wholesale segment were 10.1% for the three months ended March 31, 2009 compared to 12.7% for the 2008 period. The decrease was primarily attributable to the elimination in the 2009 period of the duplicative expenses that were incurred in the 2008 period as the Company consolidated its West Coast distribution centers and improved labor
        efficiency.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">Distribution expenses as a percentage of net sales for the direct-to-consumer segment were approximately 39.8% for the three months ended March 31, 2009 compared to 17.4% for the 2008 period. The increase is primarily attributable to the closing of the Company&rsquo;s retail stores which did not incur the high level of freight and labor costs associated with fulfilling orders incurred by the
        Company&rsquo;s catalog and Internet business. In addition, due to the winding down of the Company&rsquo;s York, Pennsylvania distribution centers, the Company incurred substantial inefficiencies in the facility during the 2009 period.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <div title="EE+ Page Footer">
            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"></p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><font size="2">-22-</font></p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"></p>
        </div>

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        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><b><font size="2">Selling, general and administrative expenses</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">Selling, general and administrative expenses for the three months ended March 31, 2009 were $23.6 million, a decrease of 24.1% from $31.1 million for the 2008 period. </font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">Selling, general and administrative expenses for the three months ended March 31, 2009 for the wholesale segment were $18.4 million, a decrease of $600,000 or 3.2% from the $19.0 million for the 2008 period. As a percentage of net sales, selling, general and administrative expenses were 22.0% for the three months ended March 31, 2009 compared to 23.6% for the 2008 period. The decrease was primarily
        attributable to the Company&rsquo;s efforts to lower expenses, including selling expenses, such as amounts spent for travel, trade shows and advertising. The decrease was partially offset by the additional cost to operate the Mikasa&reg; business. </font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">Selling, general and administrative expenses for the three months ended March 31, 2009 for the direct-to-consumer segment were $2.5 million compared to $9.5 million for the 2008 period. The decrease was due to the retail operations that were ceased in 2008. Total selling, general and administrative expenses for the Internet and catalog businesses were consistent in both periods.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">Unallocated corporate expenses for the three months ended March 31, 2009 and 2008 were $2.7 million and $2.6 million, respectively. The increase was primarily attributable to an increase in consulting related expenses offset in part by lower stock option expense.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><b><font size="2">Restructuring expenses</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">During the three months ended March 31, 2009, the Company recorded restructuring expenses of $824,000 consisting principally of lease obligations and employee related expenses related to the 2008 restructuring initiative that commenced in the third quarter of 2008. </font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><b><font size="2">Interest expense</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">Interest expense for the three months ended March 31, 2009 was $2.9 million compared to $2.7 million for the 2008 period. The increase in interest expense was primarily attributable to higher average interest rates and to a lesser extent higher average borrowings during the 2009 period.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><b><font size="2">Income tax benefit (provision)</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">The income tax&nbsp;provision for the three months ended March 31, 2009 was $135,000 compared to an income tax benefit of $4.9 million for the 2008 period. The Company&rsquo;s effective tax rate in the 2009 period reflects a reduction in the valuation allowance recoverable against certain deferred tax assets and a provision for minimum state taxes.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><b><font size="2">LIQUIDITY AND CAPITAL RESOURCES</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">The Company&rsquo;s principal sources of cash to fund liquidity needs are: (i) cash provided by operating activities and (ii) borrowings available under its Credit Facility. The Company&rsquo;s primary uses of funds consist of working capital requirements, capital expenditures and payment of principal and interest on its debt. </font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">At March 31, 2009, the Company had cash and cash equivalents of $2.0 million, compared to $3.5 million at December 31, 2008.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">Borrowings under the Company&rsquo;s Credit Facility were $79.7 million at March 31, 2009 which represents a decrease of $9.6 million from December 31, 2008. </font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

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            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"></p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><font size="2">-23-</font></p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"></p>
        </div>

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        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><b><font size="2">Credit facility</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">The Company has a $150 million secured credit facility that matures on January 31, 2011 (the &ldquo;Credit Facility&rdquo;). Borrowings under the Credit Facility are secured by all assets of the Company. At December 31, 2008, the Company was not in compliance with the financial covenants required by the Credit Facility. On March 31, 2009, the Company entered into a waiver and amendment to the Credit
        Facility (the &ldquo;Amendment&rdquo;). Pursuant to the Amendment, the Company&rsquo;s lenders waived the Company&rsquo;s non-compliance with the financial covenants required by the Credit Facility at December 31, 2008. The Amendment modifies the Credit Facility in certain ways including, as follows: (i) changes the maturity date to January 31, 2011, (ii) adds certain asset categories to the borrowing base, (iii) increases the applicable margin rates (including a minimum LIBOR of
        1.75%), (iv) revises the minimum EBITDA and fixed charge coverage covenants and adds both a minimum net sales and maximum capital expenditures covenant, (v) eliminates the requirement of maximum leverage and minimum interest coverage ratios, (vi) eliminates the $50 million accordion feature, (vii) revises the minimum excess availability amount and (viii) places restrictions on dividends and acquisitions. The Amendment also provides for a lock-box arrangement with the collateral agent.
        Pursuant to the Amendment, although the Credit Facility matures on January 31, 2011, the Company is required by current accounting standards to classify the indebtedness as a current liability in the condensed consolidated balance sheets as of March 31, 2009 and December 31, 2008.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">At March 31, 2009, the Company had $1.6 million of open letters of credit and $79.7 million of borrowings outstanding under the Credit Facility. Interest rates on outstanding borrowings at March 31, 2009 ranged from 4.75% to 8.37%. Availability under the Credit Facility at March 31, 2009 was $36.4 million (net of $10.0 million of minimum required availability). The Company has interest rate swap and
        collar agreements with an aggregate notional amount of $55.2 million at March 31, 2009. The Company entered into these agreements to effectively fix the interest rate on a portion of its borrowings under the Credit Facility. </font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><b><font size="2">Convertible Notes</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">The Company has outstanding $75 million aggregate principal amount of 4.75% Convertible Senior Notes due 2011 (the &ldquo;Notes&rdquo;). The Notes are convertible into shares of the Company&rsquo;s common stock at a conversion price of $28.00 per share, subject to adjustment in certain events. The Notes bear interest at 4.75% </font><i><font size="2">per annum</font></i><font size="2">, payable
        semiannually in arrears on January 15 and July 15 of each year and are unsubordinated except with respect to the Company&rsquo;s debt to the extent secured by the Company&rsquo;s assets. The Notes mature on July 15, 2011. The Company may not redeem the Notes at any time prior to maturity. The Notes are convertible at the option of the holder anytime prior to the close of business on the business day prior to the maturity date. Upon conversion, the Company may elect to deliver either
        shares of the Company&rsquo;s common stock, cash or a combination of cash and shares of the Company&rsquo;s common stock in satisfaction of the Company&rsquo;s obligations upon conversion of the Notes. If the Notes are not converted prior to the maturity date the Company is required to pay the holders of the Notes the principal amount of the Notes in cash upon maturity. </font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">Effective January 1, 2009, the Company adopted the provisions of FSP APB 14-1 on a retrospective basis. Accordingly, the accompanying December 31, 2008 condensed consolidated balance sheet and March 31, 2008 condensed consolidated statement of operations and cash flows have been adjusted to reflect the application of the provisions of FSP APB 14-1. The cumulative effect of applying the provisions of FSP
        APB 14-1 resulted in an addition to the accumulated deficit of $3.5 million as of January 1, 2009. </font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <div title="EE+ Page Footer">
            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"></p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><font size="2">-24-</font></p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"></p>
        </div>

        <div title="EE+ Page Break" style="FONT-SIZE: 1pt; PAGE-BREAK-AFTER: always; WIDTH: 100%; HEIGHT: 1px">
            <hr align="center" width="100%" noshade size="2">
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><b><font size="2">Dividends</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><font size="2">In February 2009, the Company suspended paying a cash dividend on its outstanding shares of common stock.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><b><font size="2">Operating activities</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">Cash provided by operating activities was $8.9 million for the three months ended March 31, 2009 compared to cash used by operating activities of $5.3 million in the 2008 period. The increase resulted from improved operating results and a working capital decrease during the 2009 period. The decrease in working capital was primarily attributable to a greater reduction in accounts receivable and inventory
        levels in the 2009 period compared to the 2008 period. </font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><b><font size="2">Investing activities</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">Cash used in investing activities was $679,000 for the three months ended March 31, 2009 compared to $2.7 million in the 2008 period, all related to capital expenditures. The Company&rsquo;s 2009 planned capital expenditures are estimated not to exceed $6.0 million. </font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><b><font size="2">Financing activities</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">Cash used by financing activities was $9.7 million for the three months ended March 31, 2009 compared to cash provided by financing activities of $4.3 million for the 2008 period. In 2009, net repayments under the Company&rsquo;s Credit Facility were $9.6 million compared to net borrowings of $5.2 million for the 2008 period. </font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <div title="EE+ Page Footer">
            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"></p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><font size="2">-25-</font></p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"></p>
        </div>

        <div title="EE+ Page Break" style="FONT-SIZE: 1pt; PAGE-BREAK-AFTER: always; WIDTH: 100%; HEIGHT: 1px">
            <hr align="center" width="100%" noshade size="2">
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><b><font size="2"><a name="p1item3"><b><font size="2">Item 3</font></b></a>. Quantitative and Qualitative Disclosures About Market Risk</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">Market risk represents the risk of loss that may impact the consolidated financial position, results of operations or cash flows of the Company. The Company is exposed to market risk associated with changes in interest rates. The Company&rsquo;s Credit Facility bears interest at variable rates and, therefore, the Company is subject to increases and decreases in interest expense resulting from fluctuations
        in interest rates. The Company has interest rate swap agreements with an aggregate notional amount of $50 million and interest rate collar agreements with an aggregate notional amount of $40.2 million to manage interest rate exposure in connection with these variable interest rate borrowings. There have been no changes in interest rates that would have a material impact on the consolidated financial position, results of operations or cash flows of the Company for the three months ended
        March 31, 2009.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><b><font size="2"><a name="p1item4"><b><font size="2">Item 4</font></b></a>. Controls and Procedures</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <div align="left">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="54%" border="0">
                <tr>
                    <td valign="top" nowrap width="9%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">(</font><b><font size="2">a) </font></b></p>
                    </td>

                    <td valign="top" nowrap width="90%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><b><font size="2">Evaluation of Disclosure Controls and Procedures</font></b></p>
                    </td>
                </tr>
            </table>
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 5.23%; TEXT-ALIGN: justify"><font size="2">The Chief Executive Officer and the Chief Financial Officer of the Company (its principal executive officer and principal financial officer, respectively) have concluded, based on their evaluation as of March 31, 2009, that the Company&rsquo;s controls and procedures are effective to ensure that information required to be disclosed by the Company in the reports filed by it under the
        Securities and Exchange Act of 1934, as amended, is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission&rsquo;s rules and forms, and include controls and procedures designed to ensure that information required to be disclosed by the Company in such reports is accumulated and communicated to the Company&rsquo;s management, including the Chief Executive Officer and Chief Financial Officer of the Company, as appropriate
        to allow timely decisions regarding required disclosure.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 5.23%; TEXT-ALIGN: justify">&nbsp;</p>

        <div align="left">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="35%" border="0">
                <tr>
                    <td valign="top" nowrap width="15%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><b><font size="2">(b) </font></b></p>
                    </td>

                    <td valign="top" nowrap width="84%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><b><font size="2">Changes in Internal Controls</font></b></p>
                    </td>
                </tr>
            </table>
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 5.23%; TEXT-ALIGN: justify"><font size="2">There were no changes in the Company&rsquo;s internal control over financial reporting that occurred during the Company&rsquo;s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the Company&rsquo;s internal control over financial reporting.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 5.23%; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><b><font size="2"><a name="part2"><b><font size="2">PART II </font></b></a>- OTHER INFORMATION</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><b><font size="2"><a name="p2item1a"><b><font size="2">Item 1A</font></b></a>. Risk Factors</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">There have been no material changes in the Company&rsquo;s risk factors from those disclosed in the Company&rsquo;s 2008 Annual Report on Form 10-K.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><b><font size="2"><a name="p2item6"><b><font size="2">Item 6</font></b></a>. Exhibits </font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <div align="left">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="8%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">10.1</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="91%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify"><a href="ex10-1_f10q033109.htm"><font size="2">Waiver letter re: annual compensation increase &ndash; Employment Agreement dated May 2, 2006 by and between Lifetime Brands, Inc. and Jeffrey Siegel.</font></a></p>

                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify">&nbsp;</p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="8%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">10.2</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="91%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify"><a href="ex10-2_f10q033109.htm"><font size="2">Waiver letter re: annual compensation increase &ndash; Employment Agreement dated October 17, 2005 by and between Lifetime Brands, Inc. and Ronald Shiftan, as amended.</font></a></p>

                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify">&nbsp;</p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="8%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">10.3</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="91%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify"><a href="ex10-3_f10q033109.htm"><font size="2">Waiver letter re: annual compensation increase &ndash; Employment Agreement dated June 28, 2007 by and between Lifetime Brands, Inc. and Laurence Winoker.</font></a></p>

                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify">&nbsp;</p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="8%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">31.1 </font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="91%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify"><a href="ex31-1_f10q033109.htm"><font size="2">Certification by Jeffrey Siegel, Chief Executive Officer and President, pursuant to Rule 13a-14(a) or Rule 15d-14(a) of the Securities and Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.</font></a></p>

                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify">&nbsp;</p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="8%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">31.2 </font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="91%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify"><a href="ex31-2_f10q033109.htm"><font size="2">Certification by Laurence Winoker, Senior Vice President &ndash; Finance, Treasurer and Chief Financial Officer, pursuant to Rule 13a-14(a) or Rule 15d-14(a) of the Securities and Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.</font></a></p>

                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify">&nbsp;</p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="8%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">32.1 </font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="91%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify"><font size="2"><a href="ex32-1_f10q033109.htm">Certification by Jeffrey Siegel, Chief Executive Officer and President, and Laurence Winoker, Senior Vice President &ndash; Finance, Treasurer and Chief Financial Officer, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.</a> </font></p>
                    </td>
                </tr>
            </table>
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <div title="EE+ Page Footer">
            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"></p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><font size="2">-26-</font></p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"></p>
        </div>

        <div title="EE+ Page Break" style="FONT-SIZE: 1pt; PAGE-BREAK-AFTER: always; WIDTH: 100%; HEIGHT: 1px">
            <hr align="center" width="100%" noshade size="2">
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><b><a name="signatures"><font size="2"><b><font size="2">SIGNATURES</font></b></font></a></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <div align="left">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="40%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" colspan="2">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Lifetime Brands, Inc.</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="16%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="40%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="40%" colspan="2">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="16%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="40%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="40%" colspan="2">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="16%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="40%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 1px solid" valign="bottom" width="333">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">/s/ Jeffrey Siegel</font></p>
                    </td>

                    <td width="123">
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="16%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">May 11, 2009</font></p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="40%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="40%" colspan="2">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Jeffrey Siegel</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="16%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="40%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="40%" colspan="2">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Chief Executive Officer and President</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="16%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="40%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="40%" colspan="2">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 2.25pt; TEXT-ALIGN: left"><font size="2">(Principal Executive Officer)</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="16%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="40%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="40%" colspan="2">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="16%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="40%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="40%" colspan="2">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="16%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="40%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in; BORDER-BOTTOM: black 1px solid" valign="bottom" width="333" colspan="1">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">/s/ Laurence Winoker</font></p>
                    </td>

                    <td width="123">
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="16%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">May 11, 2009</font></p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="40%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="40%" colspan="2">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Laurence Winoker</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="16%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="40%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="40%" colspan="2">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Senior Vice President &ndash; Finance, Treasurer and Chief Financial Officer</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="16%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>
                </tr>

                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="40%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="40%" colspan="2">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">(Principal Financial and Accounting Officer)</font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="bottom" width="16%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>
                    </td>
                </tr>
            </table>
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <div title="EE+ Page Footer">
            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"></p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><font size="2">-27-</font></p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"></p>
        </div>
        <hr align="center" width="100%" noshade size="2">
    </body>
</html>

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>2
<FILENAME>ex10-1_f10q033109.htm
<DESCRIPTION>EXHIBIT 10.1
<TEXT>
<html>
    <head>
        <title></title>
    </head>

    <body style="FONT-FAMILY: 'Times New Roman'" bgcolor="#ffffff">
        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: right"><b><a name="ex10-1f10q033109"><font size="2"><b><font size="2">Exhibit 10.1</font></b></font></a></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><font size="2">January 1, 2009</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><font size="2">Lifetime Brands, Inc.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><font size="2">Attention: Ronald Shiftan</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><font size="2">1000 Stewart Avenue</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><font size="2">Garden City, NY 11530</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><font size="2">Dear Mr. Shiftan: </font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><font size="2">RE: Employment Agreement dated May 2, 2006 by and between Lifetime Brands, Inc. and Jeffrey Siegel (the &ldquo;Employment Agreement&rdquo;)</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><font size="2">As discussed, I hereby irrevocably waive my right under Section 3(a) of the Employment Agreement to receive an annual increase in base salary for the period commencing on January 1, 2009 and ending on December 31, 2009 based on the percentage by which the Bureau of Labor Statistics Consumer Price Index for All Urban Consumers (CPI-U) all items index, New York-Northern New Jersey-Long Island, NY-NJ-CT-PA (the
        &ldquo;Relevant CPI Index&rdquo;) for December 31, 2008 increased over the Relevant CPI Index for December 31, 2007. However, my base salary for the one year period commencing on January 1, 2010 and ending on December 31, 2010 shall be adjusted based on the annualized compounded increase in the Relevant CPI index from December 31, 2007 to December 31, 2009. (For example, if I earned a base salary of $100,000 for the period commencing January 1, 2008 and ending on December 31, 2008 and
        would have received a 3% increase in my base salary for the period commencing January 1, 2009 and ending on December 31, 2009 based upon the increase in the Relevant CPI index from December 31, 2007 to December 31, 2008, I will continue to be paid a base salary of $100,000 for the one year period commencing on January 1, 2009 and ending on December 31, 2009, rather than a base salary of $103,000. If the Relevant CPI index increases 4% from December 31, 2008 to December 31, 2009, my base
        salary will be $107,120 for the one year period commencing on January 1, 2010 and ending on December 31, 2010). All other terms and conditions of the Employment Agreement shall remain in full force and effect. </font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><font size="2">Sincerely, </font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><font size="2">/s/ Jeffrey Siegel </font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><font size="2">Jeffrey Siegel</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><font size="2">Accepted and Agreed:</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><font size="2">LIFETIME BRANDS, INC.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><u><font size="2">/s/ Ronald Shiftan&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&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></u></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><font size="2">By: Ronald Shiftan, Vice Chairman and COO</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>
        <hr align="center" width="100%" noshade size="2">
    </body>
</html>

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>3
<FILENAME>ex10-2_f10q033109.htm
<DESCRIPTION>EXHIBIT 10.2
<TEXT>
<html>
    <head>
        <title></title>
    </head>

    <body style="FONT-FAMILY: 'Times New Roman'" bgcolor="#ffffff">
        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: right"><b><a name="ex10-2f10q033109"><font size="2"><b><font size="2">Exhibit 10.2</font></b></font></a></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><font size="2">January 1, 2009</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><font size="2">Lifetime Brands, Inc.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><font size="2">Attention: Jeffrey Siegel</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><font size="2">1000 Stewart Avenue</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><font size="2">Garden City, NY 11530</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><font size="2">Dear Mr. Siegel: </font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><font size="2">RE: Employment Agreement dated October 17, 2005 by and between Lifetime Brands, Inc. and Ronald Shiftan, as amended (the &ldquo;Employment Agreement&rdquo;)</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><font size="2">As discussed, I hereby irrevocably waive my right under Section 3(a) of the Employment Agreement to receive an annual increase in base salary for the period commencing on January 1, 2009 and ending on December 31, 2009 based on the percentage by which the Bureau of Labor Statistics Consumer Price Index for All Urban Consumers (CPI-U) all items index, New York-Northern New Jersey-Long Island, NY-NJ-CT-PA (the
        &ldquo;Relevant CPI Index&rdquo;) for December 2008 increased over the Relevant CPI Index for December 2007. However, my base salary for the one year period commencing on January 1, 2010 and ending on December 31, 2010 shall be adjusted based on the annualized compounded increase in the Relevant CPI index from December 2007 to December 2009. (For example, if I earned a base salary of $100,000 for the period commencing January 1, 2008 and ending on December 31, 2008 and would have
        received a 3% increase in my base salary for the period commencing January 1, 2009 and ending on December 31, 2009 based upon the increase in the Relevant CPI index from December 2007 to December 2008, I will continue to be paid a base salary of $100,000 for the one year period commencing on January 1, 2009 and ending on December 31, 2009, rather than a base salary of $103,000. If the Relevant CPI index increases 4% from December 2008 to December 2009, my base salary will be $107,120
        for the one year period commencing on January 1, 2010 and ending on December 31, 2010). All other terms and conditions of the Employment Agreement remain in full force and effect. </font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><font size="2">Sincerely, </font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><font size="2">/s/ Ronald Shiftan</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><font size="2">Ronald Shiftan</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><font size="2">Accepted and Agreed:</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><font size="2">LIFETIME BRANDS, INC.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><u><font size="2">/s/ Jeffrey Siegel&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&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></u></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><font size="2">By: Jeffrey Siegel, Chairman, CEO and President</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>
        <hr align="center" width="100%" noshade size="2">
    </body>
</html>

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>4
<FILENAME>ex10-3_f10q033109.htm
<DESCRIPTION>EXHIBIT 10.3
<TEXT>
<html>
    <head>
        <title></title>
    </head>

    <body style="FONT-FAMILY: 'Times New Roman'" bgcolor="#ffffff">
        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>
        <a name="ex10-3f10q033109"></a>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: right"><b><font size="2">Exhibit 10.3</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><font size="2">January 1, 2009</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><font size="2">Lifetime Brands, Inc.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><font size="2">Attention: Ronald Shiftan</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><font size="2">1000 Stewart Avenue</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><font size="2">Garden City, NY 11530</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><font size="2">Dear Mr. Shiftan: </font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><font size="2">RE: Employment Agreement dated June 28, 2007 by and between Lifetime Brands, Inc. and Laurence Winoker (the &ldquo;Employment Agreement&rdquo;)</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><font size="2">As discussed, I hereby agree to irrevocably waive my right under Section 3(a) of the Employment Agreement to receive an annual increase in base salary for the period commencing on January 1, 2009 and ending on December 31, 2009 based on changes in the Bureau of Labor Statistics Consumer Price Index for New York-Northern New Jersey-Long Island, NY-NJ-CT-PA (the &ldquo;CPI Index&rdquo;). However, my base
        salary for the one year period commencing on January 1, 2010 and ending on December 31, 2010 shall be adjusted based on the annualized compounded increase in the relevant CPI index from January 1, 2008 to December 31, 2009. (For example, if I earned a base salary of $100,000 for the period commencing January 1, 2008 and ending on December 31, 2008 and would have received a 3% increase in my base salary for the period commencing January 1, 2009 and ending on December 31, 2009 based upon
        the increase in the relevant CPI index, I will continue to be paid a base salary of $100,000 for the one year period commencing on January 1, 2009 and ending on December 31, 2009, rather than a base salary of $103,000. If the relevant CPI index increases 4% from January 1, 2009 to December 31, 2009, my base salary will be $107,120 for the one year period commencing on January 1, 2010 and ending on December 31, 2010). All other terms and conditions of the Employment Agreement remain in
        full force and effect. </font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><font size="2">Sincerely, </font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><font size="2">/s/ Laurence Winoker</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><font size="2">Laurence Winoker </font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><font size="2">Accepted and Agreed:</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><font size="2">LIFETIME BRANDS, INC.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><u><font size="2">/s/ Ronald Shiftan&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&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></u></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><font size="2">By: Ronald Shiftan, Vice Chairman and COO</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>
        <hr align="center" width="100%" noshade size="2">
    </body>
</html>

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-31
<SEQUENCE>5
<FILENAME>ex31-1_f10q033109.htm
<DESCRIPTION>EXHIBIT 31.1
<TEXT>
<html>
    <head>
        <title></title>
    </head>

    <body style="FONT-FAMILY: 'Times New Roman'" bgcolor="#ffffff">
        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: right"><b><a name="ex31-1f10q033109"><font size="2"><b><font size="2">Exhibit 31.1</font></b></font></a></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><b><font size="2">CERTIFICATION</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><font size="2">I, Jeffrey Siegel, certify that:</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <div align="left">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
                <tr>
                    <td valign="top" width="6%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify">&nbsp;</p>
                    </td>

                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">1.</font></p>
                    </td>

                    <td valign="top">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify"><font size="2">I have reviewed this quarterly report on Form 10-Q of Lifetime Brands, Inc. (&ldquo;the registrant&rdquo;);</font></p>
                    </td>
                </tr>
            </table>
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 10%; TEXT-INDENT: -3.85%; TEXT-ALIGN: justify">&nbsp;</p>

        <div align="left">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
                <tr>
                    <td valign="top" width="6%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify">&nbsp;</p>
                    </td>

                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">2.</font></p>
                    </td>

                    <td valign="top">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify"><font size="2">Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report;</font></p>
                    </td>
                </tr>
            </table>
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 10%; TEXT-INDENT: -3.85%; TEXT-ALIGN: justify">&nbsp;</p>

        <div align="left">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
                <tr>
                    <td valign="top" width="6%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify">&nbsp;</p>
                    </td>

                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">3.</font></p>
                    </td>

                    <td valign="top">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify"><font size="2">Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report;</font></p>
                    </td>
                </tr>
            </table>
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 10%; TEXT-INDENT: -3.85%; TEXT-ALIGN: justify">&nbsp;</p>

        <div align="left">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
                <tr>
                    <td valign="top" width="6%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify">&nbsp;</p>
                    </td>

                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">4.</font></p>
                    </td>

                    <td valign="top">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify"><font size="2">The registrant&rsquo;s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-14 and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f))) for the registrant and have:</font></p>
                    </td>
                </tr>
            </table>
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 10%; TEXT-INDENT: -3.85%; TEXT-ALIGN: justify">&nbsp;</p>

        <div align="left">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
                <tr>
                    <td valign="top" width="13%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify">&nbsp;</p>
                    </td>

                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">a.</font></p>
                    </td>

                    <td valign="top">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify"><font size="2">designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly
                        report is being prepared;</font></p>
                    </td>
                </tr>
            </table>
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 17.69%; TEXT-INDENT: -3.85%; TEXT-ALIGN: justify">&nbsp;</p>

        <div align="left">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
                <tr>
                    <td valign="top" width="13%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify">&nbsp;</p>
                    </td>

                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">b.</font></p>
                    </td>

                    <td valign="top">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify"><font size="2">designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting
                        principles;</font></p>
                    </td>
                </tr>
            </table>
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 17.69%; TEXT-INDENT: -3.85%; TEXT-ALIGN: justify">&nbsp;</p>

        <div align="left">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
                <tr>
                    <td valign="top" width="13%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify">&nbsp;</p>
                    </td>

                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">c.</font></p>
                    </td>

                    <td valign="top">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify"><font size="2">evaluated the effectiveness of the registrant&rsquo;s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and</font></p>
                    </td>
                </tr>
            </table>
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 17.69%; TEXT-INDENT: -3.85%; TEXT-ALIGN: justify">&nbsp;</p>

        <div align="left">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
                <tr>
                    <td valign="top" width="13%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify">&nbsp;</p>
                    </td>

                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">d.</font></p>
                    </td>

                    <td valign="top">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify"><font size="2">disclosed in this report any change in the registrant&rsquo;s internal control over financial reporting that occurred during the registrant&rsquo;s most recent fiscal quarter that has materially affected or is reasonably likely to materially affect the registrant&rsquo;s internal control over financial reporting; and</font></p>
                    </td>
                </tr>
            </table>
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 17.69%; TEXT-INDENT: -3.85%; TEXT-ALIGN: justify">&nbsp;</p>

        <div align="left">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
                <tr>
                    <td valign="top" width="6%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify">&nbsp;</p>
                    </td>

                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">5.</font></p>
                    </td>

                    <td valign="top">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify"><font size="2">The registrant&rsquo;s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant&rsquo;s auditors and the audit committee of the registrant&rsquo;s board of directors (or persons performing the equivalent functions):</font></p>
                    </td>
                </tr>
            </table>
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 10%; TEXT-INDENT: -3.85%; TEXT-ALIGN: justify">&nbsp;</p>

        <div align="left">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
                <tr>
                    <td valign="top" width="13%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify">&nbsp;</p>
                    </td>

                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">a.</font></p>
                    </td>

                    <td valign="top">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify"><font size="2">all significant deficiencies in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant&rsquo;s ability to record, process, summarize and report financial information; and</font></p>
                    </td>
                </tr>
            </table>
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 17.69%; TEXT-INDENT: -3.85%; TEXT-ALIGN: justify">&nbsp;</p>

        <div align="left">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
                <tr>
                    <td valign="top" width="13%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify">&nbsp;</p>
                    </td>

                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">b.</font></p>
                    </td>

                    <td valign="top">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify"><font size="2">any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant&rsquo;s internal control over financial reporting.</font></p>
                    </td>
                </tr>
            </table>
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 17.69%; TEXT-INDENT: -3.85%; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><u><font size="2">/s/ Jeffrey Siegel&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&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></u><font size="2">&nbsp;</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><font size="2">Jeffrey Siegel<br>
        <font size="2">Chief Executive Officer and President </font></font></p>

        <div align="left">
            &nbsp;
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <div align="left">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="23%" border="0">
                <tr>
                    <td valign="top" nowrap width="41%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Date: </font></p>
                    </td>

                    <td valign="top" nowrap width="58%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">May 11, 2009</font></p>
                    </td>
                </tr>
            </table>
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>
        <hr align="center" width="100%" noshade size="2">
    </body>
</html>

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-31
<SEQUENCE>6
<FILENAME>ex31-2_f10q033109.htm
<DESCRIPTION>EXHIBIT 31.2
<TEXT>
<html>
    <head>
        <title></title>
    </head>

    <body style="FONT-FAMILY: 'Times New Roman'" bgcolor="#ffffff">
        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: right"></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>
        <b><a name="ex31-2f10q033109"></a></b>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: right"><b><font size="2">Exhibit 31.2</font></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: center"><font size="2"><strong>CERTIFICATION</strong></font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><font size="2">I, Laurence Winoker, certify that:</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <div align="left">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
                <tr>
                    <td valign="top" width="5%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify">&nbsp;</p>
                    </td>

                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">1.</font></p>
                    </td>

                    <td valign="top">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify"><font size="2">I have reviewed this quarterly report on Form 10-Q of Lifetime Brands, Inc. (&ldquo;the registrant&rdquo;);</font></p>
                    </td>
                </tr>
            </table>
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 9.54%; TEXT-INDENT: -3.85%; TEXT-ALIGN: justify">&nbsp;</p>

        <div align="left">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
                <tr>
                    <td valign="top" width="5%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify">&nbsp;</p>
                    </td>

                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">2.</font></p>
                    </td>

                    <td valign="top">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify"><font size="2">Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report;</font></p>
                    </td>
                </tr>
            </table>
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 9.69%; TEXT-INDENT: -3.85%; TEXT-ALIGN: justify">&nbsp;</p>

        <div align="left">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
                <tr>
                    <td valign="top" width="5%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify">&nbsp;</p>
                    </td>

                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">3.</font></p>
                    </td>

                    <td valign="top">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify"><font size="2">Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report;</font></p>
                    </td>
                </tr>
            </table>
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 9.69%; TEXT-INDENT: -3.85%; TEXT-ALIGN: justify">&nbsp;</p>

        <div align="left">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
                <tr>
                    <td valign="top" width="5%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify">&nbsp;</p>
                    </td>

                    <td valign="top" width="34">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">4.</font></p>
                    </td>

                    <td valign="top" width="1023">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify"><font size="2">The registrant&rsquo;s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-14 and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f))) for the registrant and have:</font></p>
                    </td>
                </tr>
            </table>
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 9.54%; TEXT-INDENT: -4.15%; TEXT-ALIGN: justify">&nbsp;</p>

        <div align="left">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
                <tr>
                    <td valign="top" width="13%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify">&nbsp;</p>
                    </td>

                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">a.</font></p>
                    </td>

                    <td valign="top">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify"><font size="2">designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly
                        report is being prepared;</font></p>
                    </td>
                </tr>
            </table>
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 17.69%; TEXT-INDENT: -3.85%; TEXT-ALIGN: justify">&nbsp;</p>

        <div align="left">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
                <tr>
                    <td valign="top" width="13%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify">&nbsp;</p>
                    </td>

                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">b.</font></p>
                    </td>

                    <td valign="top">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify"><font size="2">designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting
                        principles;</font></p>
                    </td>
                </tr>
            </table>
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 17.69%; TEXT-INDENT: -3.85%; TEXT-ALIGN: justify">&nbsp;</p>

        <div align="left">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
                <tr>
                    <td valign="top" width="13%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify">&nbsp;</p>
                    </td>

                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">c.</font></p>
                    </td>

                    <td valign="top">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify"><font size="2">evaluated the effectiveness of the registrant&rsquo;s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and</font></p>
                    </td>
                </tr>
            </table>
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 17.69%; TEXT-INDENT: -3.85%; TEXT-ALIGN: justify">&nbsp;</p>

        <div align="left">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
                <tr>
                    <td valign="top" width="13%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify">&nbsp;</p>
                    </td>

                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">d.</font></p>
                    </td>

                    <td valign="top">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify"><font size="2">disclosed in this report any change in the registrant&rsquo;s internal control over financial reporting that occurred during the registrant&rsquo;s most recent fiscal quarter that has materially affected or is reasonably likely to materially affect the registrant&rsquo;s internal control over financial reporting; and</font></p>
                    </td>
                </tr>
            </table>
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 17.69%; TEXT-INDENT: -3.85%; TEXT-ALIGN: justify">&nbsp;</p>

        <div align="left">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
                <tr>
                    <td valign="top" width="5%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify">&nbsp;</p>
                    </td>

                    <td valign="top" width="34">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">5.</font></p>
                    </td>

                    <td valign="top" width="1023">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify"><font size="2">The registrant&rsquo;s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant&rsquo;s auditors and the audit committee of the registrant&rsquo;s board of directors (or persons performing the equivalent functions):</font></p>
                    </td>
                </tr>
            </table>
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 9.69%; TEXT-INDENT: -3.85%; TEXT-ALIGN: justify">&nbsp;</p>

        <div align="left">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
                <tr>
                    <td valign="top" width="14%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify">&nbsp;</p>
                    </td>

                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">a.</font></p>
                    </td>

                    <td valign="top">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify"><font size="2">all significant deficiencies in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant&rsquo;s ability to record, process, summarize and report financial information; and</font></p>
                    </td>
                </tr>
            </table>
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 17.85%; TEXT-INDENT: -3.85%; TEXT-ALIGN: justify">&nbsp;</p>

        <div align="left">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
                <tr>
                    <td valign="top" width="14%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify">&nbsp;</p>
                    </td>

                    <td valign="top" width="3%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">b.</font></p>
                    </td>

                    <td valign="top">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify"><font size="2">any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant&rsquo;s internal control over financial reporting.</font></p>
                    </td>
                </tr>
            </table>
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 17.85%; TEXT-INDENT: -3.85%; TEXT-ALIGN: justify">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"><u><font size="2">/s/ Laurence Winoker&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<br>
        </font></u><font size="2">Laurence Winoker<br>
        Senior Vice President &ndash; Finance, <br>
        Treasurer and Chief Financial Officer </font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <div align="left">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="25%" border="0">
                <tr>
                    <td valign="top" nowrap width="34%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Date: </font></p>
                    </td>

                    <td valign="top" nowrap width="55%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">May 11, 2009</font></p>
                    </td>
                </tr>
            </table>
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

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            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

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</DOCUMENT>
<DOCUMENT>
<TYPE>EX-32
<SEQUENCE>7
<FILENAME>ex32-1_f10q033109.htm
<DESCRIPTION>EXHIBIT 32.1
<TEXT>
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        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: right"><b><a name="ex32-1f10q033109"><font size="2"><b><font size="2">Exhibit 32.1</font></b></font></a></b></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">Certification by Jeffrey Siegel, Chief Executive Officer and President, and Laurence Winoker, Senior Vice President &ndash; Finance, Treasurer and Chief Financial Officer, Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">I, Jeffrey Siegel, Chief Executive Officer and President, and I, Laurence Winoker, Senior Vice President &ndash; Finance, Treasurer and Chief Financial Officer, of Lifetime Brands, Inc., a Delaware corporation (the &ldquo;Company&rdquo;), each hereby certifies that:</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <div align="left">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
                <tr>
                    <td valign="top" width="8%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify">&nbsp;</p>
                    </td>

                    <td valign="top" width="7%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">(1)</font></p>
                    </td>

                    <td valign="top">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify"><font size="2">The Company&rsquo;s periodic report on Form 10-Q for the period ended March 31, 2009 (the &ldquo;Form 10-Q&rdquo;) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and</font></p>
                    </td>
                </tr>
            </table>
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 15.38%; TEXT-INDENT: -7.08%; TEXT-ALIGN: justify">&nbsp;</p>

        <div align="left">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
                <tr>
                    <td valign="top" width="8%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify">&nbsp;</p>
                    </td>

                    <td valign="top" width="7%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">(2)</font></p>
                    </td>

                    <td valign="top">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: justify"><font size="2">The information contained in the Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of the Company.</font></p>
                    </td>
                </tr>
            </table>
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <div align="left">
            <table style="BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
                <tr>
                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="50%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><u><font size="2">/s/ Jeffrey Siegel&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&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></u></p>

                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Jeffrey Siegel</font></p>

                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Chief Executive Officer and President</font></p>

                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>

                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>

                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Date: May 11, 2009 </font></p>
                    </td>

                    <td style="PADDING-RIGHT: 5.4pt; PADDING-LEFT: 5.4pt; PADDING-BOTTOM: 0in; PADDING-TOP: 0in" valign="top" width="50%">
                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><u><font size="2">/s/ Laurence Winoker&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&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></u><font size="2">&nbsp;</font></p>

                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Laurence Winoker</font></p>

                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Senior Vice President- Finance, Treasurer </font></p>

                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">and Chief Financial Officer</font></p>

                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left">&nbsp;</p>

                        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; TEXT-ALIGN: left"><font size="2">Date: May 11, 2009</font></p>
                    </td>
                </tr>
            </table>
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: justify"><font size="2">A signed original of this written statement required by Section 1350 has been provided to Lifetime Brands, Inc. and will be retained by Lifetime Brands, Inc. and furnished to the Securities and Exchange Commission or its staff, upon request.</font></p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

        <div title="EE+ Page Footer">
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            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>

            <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left"></p>
        </div>

        <p style="MARGIN-TOP: 0pt; MARGIN-BOTTOM: 0pt; TEXT-ALIGN: left">&nbsp;</p>
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</SEC-DOCUMENT>
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