<SEC-DOCUMENT>0001072613-17-000318.txt : 20170516
<SEC-HEADER>0001072613-17-000318.hdr.sgml : 20170516
<ACCEPTANCE-DATETIME>20170516154617
ACCESSION NUMBER:		0001072613-17-000318
CONFORMED SUBMISSION TYPE:	8-K
PUBLIC DOCUMENT COUNT:		2
CONFORMED PERIOD OF REPORT:	20170515
ITEM INFORMATION:		Results of Operations and Financial Condition
ITEM INFORMATION:		Financial Statements and Exhibits
FILED AS OF DATE:		20170516
DATE AS OF CHANGE:		20170516

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			NETWORK 1 TECHNOLOGIES INC
		CENTRAL INDEX KEY:			0001065078
		STANDARD INDUSTRIAL CLASSIFICATION:	SERVICES-PREPACKAGED SOFTWARE [7372]
		IRS NUMBER:				113027591
		STATE OF INCORPORATION:			DE
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		8-K
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	001-15288
		FILM NUMBER:		17848512

	BUSINESS ADDRESS:	
		STREET 1:		445 PARK AVENUE
		STREET 2:		SUITE 912
		CITY:			NEW YORK
		STATE:			NY
		ZIP:			10022
		BUSINESS PHONE:		2128295770

	MAIL ADDRESS:	
		STREET 1:		445 PARK AVENUE
		STREET 2:		SUITE 912
		CITY:			NEW YORK
		STATE:			NY
		ZIP:			10022

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	NETWORK 1 SECURITY SOLUTIONS INC
		DATE OF NAME CHANGE:	19980629
</SEC-HEADER>
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<DESCRIPTION>FORM 8K DATED MAY 15, 2017
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<div style="FONT-SIZE: 12pt; FONT-FAMILY: 'Times New Roman', Times, serif; FONT-WEIGHT: bold; TEXT-ALIGN: center">UNITED STATES</div>

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<div style="FONT-SIZE: 12pt; FONT-FAMILY: 'Times New Roman', Times, serif; FONT-WEIGHT: bold; TEXT-ALIGN: center">SECURITIES AND EXCHANGE COMMISSION</div>

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<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: center">Washington, D.C.&#160; 20549</div>

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<div style="FONT-SIZE: 14pt; FONT-FAMILY: 'Times New Roman', Times, serif; FONT-WEIGHT: bold; TEXT-ALIGN: center">Form 8-K</div>

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<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: center">CURRENT REPORT</div>

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<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: center">Pursuant to Section 13 or 15(d) of the</div>

<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: center">Securities Exchange Act of 1934</div>

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<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: center">Date of Report (Date of earliest event reported):&#160;&#160;&#160;<font style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; FONT-VARIANT: normal; FONT-WEIGHT: normal; FONT-STYLE: normal"><u>&#160;&#160;&#160; May 15</u></font><font style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif"><u>, 2017&#160;&#160;&#160;&#160; </u></font></div>

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<div style="FONT-SIZE: 18pt; FONT-FAMILY: 'Times New Roman', Times, serif; FONT-VARIANT: normal; FONT-WEIGHT: bold; FONT-STYLE: normal; TEXT-ALIGN: center">Network-1 Technologies, Inc.</div>

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<div style="TEXT-ALIGN: center">of incorporation)</div>
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<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; FONT-VARIANT: normal; FONT-WEIGHT: bold; FONT-STYLE: normal; TEXT-ALIGN: center">445 Park Avenue, Suite 912, New York, New York 10022</div>

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<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: left; TEXT-INDENT: 36pt">Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (<font style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; FONT-STYLE: italic">see</font> General Instruction A.2. below):</div>

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<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: left; MARGIN-LEFT: 36pt">&#9744;&#8301;&#160; Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)</div>

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<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: left; MARGIN-LEFT: 36pt">&#9744;&#8301;&#160; Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)</div>

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<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: left; MARGIN-LEFT: 36pt">&#9744;&#8301;&#160; Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))</div>

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<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: left; MARGIN-LEFT: 36pt">&#9744;&#8301;&#160; Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))</div>

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<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: left">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: left; MARGIN-LEFT: 36pt">Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (&#167;230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (&#167;240.12b-2 of this chapter),</div>

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<div style="TEXT-ALIGN: left; MARGIN-LEFT: 36pt"><font style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">Emerging growth company&#160;&#160; &#9744;</font><font id="TRGRRTFtoHTMLTab" style="FONT-SIZE: 1px; WIDTH: 180pt; DISPLAY: inline-block">&#160;</font><font style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">&#160;&#160;&#160;&#160;&#160;&#160;&#160; <a name="Check1"><!--Anchor--></a></font></div>

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<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: left; MARGIN-LEFT: 36pt">If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.<font id="TRGRRTFtoHTMLTab" style="FONT-SIZE: 1px; WIDTH: 12pt; DISPLAY: inline-block">&#160;</font>&#9744;<a name="Check2"><!--Anchor--></a></div>
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<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: justify">On May 15, 2017, Network-1 Technologies, Inc. issued a press release announcing its financial results for the quarter ended March 31, 2017.&#160; A copy of the press release is attached hereto as Exhibit 99.1.</div>

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<div style="TEXT-ALIGN: left"><font style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">(c)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">Exhibits</font></div>

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<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: left">Press Release dated May 15, 2017</div>
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<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; FONT-WEIGHT: bold; TEXT-ALIGN: center"><u>SIGNATURE</u></div>

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<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: left; TEXT-INDENT: 36pt">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 hereunto duly authorized.</div>

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<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: left">NETWORK-1 TECHNOLOGIES, INC.</div>
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<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: left; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; TEXT-INDENT: 0pt">Dated:&#160; May 16, 2017</div>
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<FILENAME>exh99-1_18068.htm
<DESCRIPTION>PRESS RELEASE DATED MAY 15, 2017
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<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; FONT-VARIANT: normal; FONT-WEIGHT: bold; FONT-STYLE: normal; TEXT-ALIGN: right"><u>EXHIBIT 99.1</u></div>

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<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; FONT-WEIGHT: bold; TEXT-ALIGN: justify">FOR IMMEDIATE RELEASE</div>

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<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: justify">Corey M. Horowitz, Chairman and CEO</div>
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<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: justify">Network-1 Technologies, Inc.</div>
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<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: justify">(212) 829-5770</div>
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<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; FONT-WEIGHT: bold; TEXT-ALIGN: center">NETWORK-1 REPORTS FIRST</div>

<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; FONT-WEIGHT: bold; TEXT-ALIGN: center">QUARTER 2017 RESULTS</div>

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<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: justify"><font style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; FONT-WEIGHT: bold">New York, New York May 15, 2017 - </font>Network-1 Technologies, Inc. (NYSE MKT: NTIP), a company specializing in the development, licensing, and protection of its intellectual property rights, today announced financial results for the quarter ended March 31, 2017.</div>

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<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: justify; TEXT-INDENT: 36pt">Network-1 had revenue of $6,221,000 for the three months ended March&#160;31, 2017 as compared to revenue of $5,190,000 for the three months ended March&#160;31, 2016. The increase of $1,031,000 or 20% in revenue for the three months ended March&#160;31, 2017 was due primarily to growth in royalty revenue from Network-1's licensees of its Remote Power Patent.</div>

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<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: justify; TEXT-INDENT: 36pt">Network-1 reported net income of $2,268,000 or $0.09 per share (basic and diluted) for the three months ended March 31, 2017 compared with net income of $3,820,000 or $0.16 per share (basic and diluted) for the three months ended March 31, 2016.&#160; The decrease in net income of $1,552,000 for the three months ended March 31, 2017 was due primarily to the recognition of additional income in the three months ended March 31, 2016 of $1,438,000 due to relief of its deferred tax allowance of $2,280,000 during such quarter.&#160; Exclusive of this relief of the deferred tax allowance, net income for the three months ended March 31, 2016 would have been $1,540,000 or $.07 per share.</div>

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<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: justify; TEXT-INDENT: 36pt">At March&#160;31, 2017, Network-1's principal sources of liquidity consisted of cash and cash equivalents of $48,000,000 and working capital of $53,820,000. Network-1 believes based on its current cash position and projected licensing revenue from its existing license agreements and other revenue that it will have sufficient cash to fund its operations for the foreseeable future.</div>

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<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: justify; TEXT-INDENT: 36pt">On December 7, 2016, the Board of Directors of Network-1 approved the initiation of a dividend policy providing for the payment of a regular semi-annual dividend of $0.05 per common share ($0.10 per common share annually) commencing in 2017. Network-1 anticipates paying the semi-annual dividends in March and September of each year.&#160; It is anticipated that the semi-annual regular dividend will continue to be paid through March 2020 (the expiration of Network-1's Remote Power Patent) provided that Network-1 continues to receive royalties from licensees of its Remote Power Patent.</div>

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<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: justify; TEXT-INDENT: 36pt">On February 2, 2017, the Board of Directors of Network-1 declared an initial semi-annual cash dividend of $0.05 per common share with a payment date of March 24, 2017 to all common stockholders of record as of March 3, 2017.</div>

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<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: justify; TEXT-INDENT: 36pt">On May<font style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; FONT-WEIGHT: bold">&#160;</font>9, 2017, Network-1's wholly-owned subsidiary, Mirror Worlds Technologies, LLC, initiated patent litigation against Facebook, Inc. in United States District Court for the Southern District of New York for infringement of U.S. Patent No. 6,006,227, U.S. Patent No. 7,865,538 and U.S. Patent No. 8,255,439, patents within&#160; Network-1's Mirror Worlds Patent Portfolio.&#160; The lawsuit alleges that the aforementioned patents are infringed by Facebook's core technologies that enable Facebook's Newsfeed and Timeline features.&#160; The lawsuit further alleges that Facebook's unauthorized use of the stream based solutions of the asserted patents has helped Facebook become the most popular social networking site in the world.</div>

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<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: left"><a id="_DV_C9" name="_DV_C9"><!--Anchor--></a><a id="_DV_M7" name="_DV_M7"><!--Anchor--></a>ABOUT NETWORK-1 TECHNOLOGIES, INC.</div>

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<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: justify; BACKGROUND-COLOR: #ffffff"><font style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">Network-1 Technologies, Inc. is engaged in the development, licensing and protection of its intellectual property and proprietary technologies.&#160; Network-1 works with inventors and patent owners to assist in the development and monetization of their patented technologies. Network-1 currently owns thirty-three (33) patents covering various telecommunications and data networking technologies as well as technologies relating to document stream operating systems and the identification of media content.&#160;</font><font style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">Network-1's current strategy includes continuing to pursue licensing opportunities for its Remote Power Patent and its efforts to monetize two patent portfolios (the Cox and Mirror Worlds patent portfolios) acquired by Network-1 in 2013.&#160; Network-1's acquisition strategy is to focus on acquiring high quality patents which management believes have the potential to generate significant licensing opportunities as Network-1 has achieved with respect to its Remote Power Patent and Mirror Worlds Patent Portfolio. Network-1's Remote Power Patent has generated licensing revenue in excess of $111,</font><a id="_GoBack" name="_GoBack"><!--Anchor--></a><font style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">000,000 from May 2007 through March 31, 2017.&#160; Since the acquisition of its Mirror Worlds Patent Portfolio in May 2013, Network-1 has achieved licensing and other revenue of $47,150,000 through March 31, 2017 with respect to its Mirror Worlds Patent Portfolio.</font></div>

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<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; FONT-STYLE: italic; TEXT-ALIGN: justify">This release contains forward-looking statements within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. These statements address future events and conditions concerning Network-1's business plans. Such statements are subject to a number of risk factors and uncertainties as disclosed in the Network-1's Annual Report on Form 10-K for the year ended December 31, 2016 filed with the Securities and Exchange Commission, including, among others, the continued validity of Network-1's Remote Power Patent, the ability of Network-1 to successfully execute its strategy to acquire high quality patents with significant licensing opportunities, Network-1's ability to achieve revenue and profits from its Cox Patent Portfolio and additional revenue and profit from its Mirror Worlds Patent Portfolio as well as intellectual property it may acquire in the future, the ability of Network-1 to enter into additional license agreements, the ability of Network-1 to continue to receive material royalties from its existing license agreements for its Remote Power Patent, the uncertainty of patent litigation and proceedings at the United States Patent and Trademark&#160;&#160; Office, the difficulty in Network-1 verifying royalty amounts owed to it by its licensees, Network-1's ability to enter into strategic relationships with third parties to license or otherwise monetize their intellectual property, the continued viability of the PoE market, the risk in the future of Network-1 being classified as a Personal Holding Company, future economic conditions and technology changes and legislative, regulatory and competitive developments. Except as otherwise required to be disclosed in periodic reports, Network-1 expressly disclaims any future obligation or undertaking to update or revise any forward-looking statement contained herein</div>

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<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: justify">The unaudited condensed consolidated statements of income and comprehensive income and unaudited condensed consolidated balance sheet are attached.</div>

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<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; FONT-WEIGHT: bold; TEXT-ALIGN: center">Three Months Ended</div>

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<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: left">REVENUE</div>
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<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">6,221,000</div>
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<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">5,190,000</div>
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<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: left">OPERATING EXPENSES:</div>
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<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: right" valign="bottom">1,792,000</td>
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<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">1,486,000</div>
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<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: left; MARGIN-LEFT: 18pt">Professional fees and related costs</div>
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<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">405,000</div>
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<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">452,000</div>
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<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: left; MARGIN-LEFT: 18pt">General and administrative</div>
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<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">484,000</div>
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<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: right" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">403,000</div>
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<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: left; MARGIN-LEFT: 18pt">Amortization of patents</div>
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<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: right" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">50,000</div>
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<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: right" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">414,000</div>
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<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: left; MARGIN-LEFT: 18pt">Stock-based compensation</div>
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<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif"></div>

<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">237,000</div>
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<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">12,000</div>
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<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: right" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: right" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
</tr>

<tr>
<td style="WIDTH: 62%; VERTICAL-ALIGN: top; PADDING-BOTTOM: 2px" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: left">TOTAL OPERATING EXPENSES</div>
</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom; PADDING-BOTTOM: 2px" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; BORDER-BOTTOM: #000000 2px solid; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; BORDER-BOTTOM: #000000 2px solid; TEXT-ALIGN: right" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">2,968,000</div>
</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom; PADDING-BOTTOM: 2px" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; BORDER-BOTTOM: #000000 2px solid; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; BORDER-BOTTOM: #000000 2px solid; TEXT-ALIGN: right" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">2,767,000</div>
</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
</tr>

<tr>
<td style="WIDTH: 62%; VERTICAL-ALIGN: top" valign="bottom">&#160;</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: right" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: right" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
</tr>

<tr>
<td style="WIDTH: 62%; VERTICAL-ALIGN: top" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: left">OPERATING INCOME</div>
</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: right" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">3,253,000</div>
</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: right" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">2,423,000</div>
</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
</tr>

<tr>
<td style="WIDTH: 62%; VERTICAL-ALIGN: top" valign="bottom">
<div>&#160;</div>

<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: left">OTHER INCOME:</div>
</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: right" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: right" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
</tr>

<tr>
<td style="WIDTH: 62%; VERTICAL-ALIGN: top; PADDING-BOTTOM: 2px" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: left; MARGIN-LEFT: 18pt">Interest income, net</div>
</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom; PADDING-BOTTOM: 2px" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; BORDER-BOTTOM: #000000 2px solid; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; BORDER-BOTTOM: #000000 2px solid; TEXT-ALIGN: right" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">9,000</div>
</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom; PADDING-BOTTOM: 2px" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; BORDER-BOTTOM: #000000 2px solid; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; BORDER-BOTTOM: #000000 2px solid; TEXT-ALIGN: right" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">10,000</div>
</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
</tr>

<tr>
<td style="WIDTH: 62%; VERTICAL-ALIGN: top" valign="bottom">&#160;</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: right" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: right" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
</tr>

<tr>
<td style="WIDTH: 62%; VERTICAL-ALIGN: top; PADDING-BOTTOM: 2px" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: left">INCOME BEFORE INCOME TAXES</div>
</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom; PADDING-BOTTOM: 2px" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; BORDER-BOTTOM: #000000 2px solid; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; BORDER-BOTTOM: #000000 2px solid; TEXT-ALIGN: right" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">3,262,000</div>
</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom; PADDING-BOTTOM: 2px" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; BORDER-BOTTOM: #000000 2px solid; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; BORDER-BOTTOM: #000000 2px solid; TEXT-ALIGN: right" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">2,433,000</div>
</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
</tr>

<tr>
<td style="WIDTH: 62%; VERTICAL-ALIGN: top" valign="bottom">&#160;</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: right" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: right" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
</tr>

<tr>
<td style="WIDTH: 62%; VERTICAL-ALIGN: top" valign="bottom">&#160;</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: right" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: right" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
</tr>

<tr>
<td style="WIDTH: 62%; VERTICAL-ALIGN: top" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: left">INCOME TAXES (BENEFIT):</div>
</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: right" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: right" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
</tr>

<tr>
<td style="WIDTH: 62%; VERTICAL-ALIGN: top" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: left; MARGIN-LEFT: 18pt">Current</div>
</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: right" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">955,000</div>
</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: right" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">51,000</div>
</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
</tr>

<tr>
<td style="WIDTH: 62%; VERTICAL-ALIGN: top; PADDING-BOTTOM: 2px" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: left; MARGIN-LEFT: 18pt">Deferred&#160; taxes, net</div>
</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom; PADDING-BOTTOM: 2px" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; BORDER-BOTTOM: #000000 2px solid; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; BORDER-BOTTOM: #000000 2px solid; TEXT-ALIGN: right" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">39,000</div>
</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom; PADDING-BOTTOM: 2px" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; BORDER-BOTTOM: #000000 2px solid; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; BORDER-BOTTOM: #000000 2px solid; TEXT-ALIGN: right" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">(1,438,000</div>
</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">)</div>
</td>
</tr>

<tr>
<td style="WIDTH: 62%; VERTICAL-ALIGN: top; PADDING-BOTTOM: 2px" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: left; MARGIN-LEFT: 18pt">Total income taxes (benefit)</div>
</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom; PADDING-BOTTOM: 2px" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; BORDER-BOTTOM: #000000 2px solid; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; BORDER-BOTTOM: #000000 2px solid; TEXT-ALIGN: right" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">994,000</div>
</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom; PADDING-BOTTOM: 2px" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; BORDER-BOTTOM: #000000 2px solid; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; BORDER-BOTTOM: #000000 2px solid; TEXT-ALIGN: right" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">(1,387,000</div>
</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">)</div>
</td>
</tr>

<tr>
<td style="WIDTH: 62%; VERTICAL-ALIGN: top" valign="bottom">&#160;</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: right" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: right" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
</tr>

<tr>
<td style="WIDTH: 62%; VERTICAL-ALIGN: top; PADDING-BOTTOM: 4px" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: left">NET INCOME</div>
</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom; PADDING-BOTTOM: 4px" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; BORDER-BOTTOM: #000000 4px double; TEXT-ALIGN: left" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">$</div>
</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; BORDER-BOTTOM: #000000 4px double; TEXT-ALIGN: right" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">2,268,000</div>
</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; PADDING-BOTTOM: 4px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom; PADDING-BOTTOM: 4px" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; BORDER-BOTTOM: #000000 4px double; TEXT-ALIGN: left" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">$</div>
</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; BORDER-BOTTOM: #000000 4px double; TEXT-ALIGN: right" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">3,820,000</div>
</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; PADDING-BOTTOM: 4px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
</tr>

<tr>
<td style="WIDTH: 62%; VERTICAL-ALIGN: top" valign="bottom">&#160;</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: right" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: right" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
</tr>

<tr>
<td style="WIDTH: 62%; VERTICAL-ALIGN: top" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: left">Net Income Per Share</div>
</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: right" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: right" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
</tr>

<tr>
<td style="WIDTH: 62%; VERTICAL-ALIGN: top; PADDING-BOTTOM: 2px" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: left; MARGIN-LEFT: 18pt">Basic</div>
</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom; PADDING-BOTTOM: 2px" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; BORDER-BOTTOM: #000000 2px solid; TEXT-ALIGN: left" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">$</div>
</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; BORDER-BOTTOM: #000000 2px solid; TEXT-ALIGN: right" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">0.09</div>
</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom; PADDING-BOTTOM: 2px" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; BORDER-BOTTOM: #000000 2px solid; TEXT-ALIGN: left" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">$</div>
</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; BORDER-BOTTOM: #000000 2px solid; TEXT-ALIGN: right" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">0.16</div>
</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
</tr>

<tr>
<td style="WIDTH: 62%; VERTICAL-ALIGN: top; PADDING-BOTTOM: 2px" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: left; MARGIN-LEFT: 18pt">Diluted</div>
</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom; PADDING-BOTTOM: 2px" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; BORDER-BOTTOM: #000000 2px solid; TEXT-ALIGN: left" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">$</div>
</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; BORDER-BOTTOM: #000000 2px solid; TEXT-ALIGN: right" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">0.09</div>
</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom; PADDING-BOTTOM: 2px" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; BORDER-BOTTOM: #000000 2px solid; TEXT-ALIGN: left" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">$</div>
</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; BORDER-BOTTOM: #000000 2px solid; TEXT-ALIGN: right" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">0.16</div>
</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
</tr>

<tr>
<td style="WIDTH: 62%; VERTICAL-ALIGN: top" valign="bottom">&#160;</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: right" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: right" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
</tr>

<tr>
<td style="WIDTH: 62%; VERTICAL-ALIGN: top" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: left">Weighted average common shares outstanding:</div>
</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: right" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: right" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
</tr>

<tr>
<td style="WIDTH: 62%; VERTICAL-ALIGN: top; PADDING-BOTTOM: 4px" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: left; MARGIN-LEFT: 18pt">Basic</div>
</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom; PADDING-BOTTOM: 4px" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; BORDER-BOTTOM: #000000 4px double; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; BORDER-BOTTOM: #000000 4px double; TEXT-ALIGN: right" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">24,118,851</div>
</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; PADDING-BOTTOM: 4px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom; PADDING-BOTTOM: 4px" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; BORDER-BOTTOM: #000000 4px double; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; BORDER-BOTTOM: #000000 4px double; TEXT-ALIGN: right" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">23,252,751</div>
</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; PADDING-BOTTOM: 4px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
</tr>

<tr>
<td style="WIDTH: 62%; VERTICAL-ALIGN: top; PADDING-BOTTOM: 4px" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: left; MARGIN-LEFT: 18pt">Diluted</div>
</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom; PADDING-BOTTOM: 4px" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; BORDER-BOTTOM: #000000 4px double; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; BORDER-BOTTOM: #000000 4px double; TEXT-ALIGN: right" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">26,333,945</div>
</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; PADDING-BOTTOM: 4px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom; PADDING-BOTTOM: 4px" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; BORDER-BOTTOM: #000000 4px double; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; BORDER-BOTTOM: #000000 4px double; TEXT-ALIGN: right" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">24,266,573</div>
</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; PADDING-BOTTOM: 4px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
</tr>

<tr>
<td style="WIDTH: 62%; VERTICAL-ALIGN: top" valign="bottom">&#160;</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: right" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: right" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
</tr>

<tr>
<td style="WIDTH: 62%; VERTICAL-ALIGN: top" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: left">Cash dividends declared per share</div>
</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">$</div>
</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: right" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">0.05</div>
</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: right" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">&#8212;</div>
</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
</tr>

<tr>
<td style="WIDTH: 62%; VERTICAL-ALIGN: top" valign="bottom">&#160;</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: right" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: right" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
</tr>

<tr>
<td style="WIDTH: 62%; VERTICAL-ALIGN: top" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: left">NET INCOME</div>
</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">$</div>
</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: right" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">2,268,000</div>
</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">$</div>
</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: right" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">3,820,000</div>
</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
</tr>

<tr>
<td style="WIDTH: 62%; VERTICAL-ALIGN: top" valign="bottom">&#160;</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: right" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: right" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
</tr>

<tr>
<td style="WIDTH: 62%; VERTICAL-ALIGN: top" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: left">OTHER COMPREHENSIVE INCOME:</div>
</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: right" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: right" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
</tr>

<tr>
<td style="WIDTH: 62%; VERTICAL-ALIGN: top; PADDING-BOTTOM: 2px" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: left; MARGIN-LEFT: 18pt">Unrealized holding gain (loss) on securities available-for-sale arising during the period</div>
</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom; PADDING-BOTTOM: 2px" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; BORDER-BOTTOM: #000000 2px solid; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; BORDER-BOTTOM: #000000 2px solid; TEXT-ALIGN: right" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">(1,000</div>
</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">)</div>
</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom; PADDING-BOTTOM: 2px" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; BORDER-BOTTOM: #000000 2px solid; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; BORDER-BOTTOM: #000000 2px solid; TEXT-ALIGN: right" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">27,000</div>
</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
</tr>

<tr>
<td style="WIDTH: 62%; VERTICAL-ALIGN: top" valign="bottom">&#160;</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: right" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: right" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
</tr>

<tr>
<td style="WIDTH: 62%; VERTICAL-ALIGN: top; PADDING-BOTTOM: 4px" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: left">COMPREHENSIVE INCOME</div>
</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom; PADDING-BOTTOM: 4px" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; BORDER-BOTTOM: #000000 4px double; TEXT-ALIGN: left" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">$</div>
</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; BORDER-BOTTOM: #000000 4px double; TEXT-ALIGN: right" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">2,267,000</div>
</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; PADDING-BOTTOM: 4px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom; PADDING-BOTTOM: 4px" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; BORDER-BOTTOM: #000000 4px double; TEXT-ALIGN: left" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">$</div>
</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; BORDER-BOTTOM: #000000 4px double; TEXT-ALIGN: right" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">3,847,000</div>
</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; PADDING-BOTTOM: 4px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
</tr>

<tr>
<td style="WIDTH: 62%; VERTICAL-ALIGN: top" valign="bottom">&#160;</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: right" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: right" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
</tr>

<tr>
<td style="WIDTH: 62%; VERTICAL-ALIGN: top" valign="bottom">&#160;</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: right" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 14%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: right" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
</tr>
</table>

<div>&#160;</div>

<div>&#160;</div>

<div>&#160;</div>

<div>&#160;</div>

<div id="DSPFPageBreakArea" style="MARGIN-BOTTOM: 10pt; MARGIN-TOP: 10pt; CLEAR: both">
<div id="DSPFPageBreak" style="PAGE-BREAK-AFTER: always">
<hr style="BORDER-LEFT-WIDTH: 0px; HEIGHT: 2px; BORDER-RIGHT-WIDTH: 0px; WIDTH: 100%; BORDER-BOTTOM-WIDTH: 0px; COLOR: #000000; CLEAR: both; MARGIN: 4px 0px; BORDER-TOP-WIDTH: 0px; BACKGROUND-COLOR: #000000" noshade="noshade">
</div>
</div>

<div>&#160;</div>

<div>&#160;</div>

<div>&#160;</div>

<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; FONT-WEIGHT: bold; TEXT-ALIGN: left">Condensed Balance Sheet as of March 31, 2017</div>

<div>&#160;</div>

<div><br>
<table id="zcf0d78848e874964b866c7110a5f8eff" style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; WIDTH: 70%" cellspacing="0" cellpadding="0" align="left" border="0">
<tr>
<td style="WIDTH: 75%; VERTICAL-ALIGN: top; PADDING-BOTTOM: 4px" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: left">Cash and cash equivalents</div>
</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom; PADDING-BOTTOM: 4px" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; BORDER-BOTTOM: #000000 4px double; TEXT-ALIGN: left" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">$</div>
</td>
<td style="WIDTH: 20%; VERTICAL-ALIGN: bottom; BORDER-BOTTOM: #000000 4px double; TEXT-ALIGN: right" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">48,000,000</div>
</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; PADDING-BOTTOM: 4px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
</tr>

<tr>
<td style="WIDTH: 75%; VERTICAL-ALIGN: top" valign="bottom">&#160;</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 20%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: right" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
</tr>

<tr>
<td style="WIDTH: 75%; VERTICAL-ALIGN: top; PADDING-BOTTOM: 4px" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: left; MARGIN-LEFT: 18pt">&#160;&#160;&#160;Total current assets</div>
</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom; PADDING-BOTTOM: 4px" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; BORDER-BOTTOM: #000000 4px double; TEXT-ALIGN: left" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">$</div>
</td>
<td style="WIDTH: 20%; VERTICAL-ALIGN: bottom; BORDER-BOTTOM: #000000 4px double; TEXT-ALIGN: right" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">56,382,000</div>
</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; PADDING-BOTTOM: 4px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
</tr>

<tr>
<td style="WIDTH: 75%; VERTICAL-ALIGN: top" valign="bottom">&#160;</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 20%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: right" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
</tr>

<tr>
<td style="WIDTH: 75%; VERTICAL-ALIGN: top; PADDING-BOTTOM: 4px" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: left; MARGIN-LEFT: 18pt">&#160;&#160;&#160;Total assets</div>
</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom; PADDING-BOTTOM: 4px" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; BORDER-BOTTOM: #000000 4px double; TEXT-ALIGN: left" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">$</div>
</td>
<td style="WIDTH: 20%; VERTICAL-ALIGN: bottom; BORDER-BOTTOM: #000000 4px double; TEXT-ALIGN: right" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">57,750,000</div>
</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; PADDING-BOTTOM: 4px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
</tr>

<tr>
<td style="WIDTH: 75%; VERTICAL-ALIGN: top" valign="bottom">&#160;</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 20%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: right" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
</tr>

<tr>
<td style="WIDTH: 75%; VERTICAL-ALIGN: top; PADDING-BOTTOM: 4px" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: left; MARGIN-LEFT: 18pt">&#160;&#160;&#160;Total current liabilities</div>
</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom; PADDING-BOTTOM: 4px" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; BORDER-BOTTOM: #000000 4px double; TEXT-ALIGN: left" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">$</div>
</td>
<td style="WIDTH: 20%; VERTICAL-ALIGN: bottom; BORDER-BOTTOM: #000000 4px double; TEXT-ALIGN: right" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">2,562,000</div>
</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; PADDING-BOTTOM: 4px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
</tr>

<tr>
<td style="WIDTH: 75%; VERTICAL-ALIGN: top" valign="bottom">&#160;</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 20%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: right" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
</tr>

<tr>
<td style="WIDTH: 75%; VERTICAL-ALIGN: top; PADDING-BOTTOM: 4px" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: left; MARGIN-LEFT: 18pt">&#160;&#160;&#160;Total long term liabilities</div>
</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom; PADDING-BOTTOM: 4px" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; BORDER-BOTTOM: #000000 4px double; TEXT-ALIGN: left" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">$</div>
</td>
<td style="WIDTH: 20%; VERTICAL-ALIGN: bottom; BORDER-BOTTOM: #000000 4px double; TEXT-ALIGN: right" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">-0-</div>
</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; PADDING-BOTTOM: 4px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
</tr>

<tr>
<td style="WIDTH: 75%; VERTICAL-ALIGN: top" valign="bottom">&#160;</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 20%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: right" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
</tr>

<tr>
<td style="WIDTH: 75%; VERTICAL-ALIGN: top; PADDING-BOTTOM: 4px" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif; TEXT-ALIGN: left">Total stockholders' equity</div>
</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom; PADDING-BOTTOM: 4px" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; BORDER-BOTTOM: #000000 4px double; TEXT-ALIGN: left" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">$</div>
</td>
<td style="WIDTH: 20%; VERTICAL-ALIGN: bottom; BORDER-BOTTOM: #000000 4px double; TEXT-ALIGN: right" valign="bottom">
<div style="FONT-SIZE: 10pt; FONT-FAMILY: 'Times New Roman', Times, serif">55,188,000</div>
</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; PADDING-BOTTOM: 4px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
</tr>

<tr>
<td style="WIDTH: 75%; VERTICAL-ALIGN: top" valign="bottom">&#160;</td>
<td style="WIDTH: 3%; VERTICAL-ALIGN: bottom" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom">&#160;</td>
<td style="WIDTH: 20%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: right" valign="bottom">&#160;</td>
<td style="WIDTH: 1%; VERTICAL-ALIGN: bottom; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap">&#160;</td>
</tr>
</table>
</div>

<div style="CLEAR: both">&#160;</div>
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</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
