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<SEC-DOCUMENT>0000950136-04-003874.txt : 20041112
<SEC-HEADER>0000950136-04-003874.hdr.sgml : 20041111
<ACCEPTANCE-DATETIME>20041112061323
ACCESSION NUMBER:		0000950136-04-003874
CONFORMED SUBMISSION TYPE:	10QSB
PUBLIC DOCUMENT COUNT:		8
CONFORMED PERIOD OF REPORT:	20040930
FILED AS OF DATE:		20041112
DATE AS OF CHANGE:		20041112

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			CPI AEROSTRUCTURES INC
		CENTRAL INDEX KEY:			0000889348
		STANDARD INDUSTRIAL CLASSIFICATION:	AIRCRAFT PART & AUXILIARY EQUIPMENT, NEC [3728]
		IRS NUMBER:				112520310
		STATE OF INCORPORATION:			NY
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		10QSB
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	001-11398
		FILM NUMBER:		041134855

	BUSINESS ADDRESS:	
		STREET 1:		200A EXECUTIVE DR
		CITY:			EDGEWOOD
		STATE:			NY
		ZIP:			11717
		BUSINESS PHONE:		5165865200
</SEC-HEADER>
<DOCUMENT>
<TYPE>10QSB
<SEQUENCE>1
<FILENAME>file001.htm
<DESCRIPTION>FORM 10QSB
<TEXT>
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<page>
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<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: center; font-style: normal; line-height: 12pt; padding-top: 36pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 0pt; background-color: #ffffff;">SECURITIES
AND EXCHANGE COMMISSION<br> Washington, D.C. 20549</p>
<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: center; font-style: normal; line-height: 12pt; padding-top: 12pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 0pt; background-color: #ffffff;">FORM
10-QSB</p>
<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: center; font-style: normal; line-height: 12pt; padding-top: 36pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 6pt; background-color: #ffffff;">QUARTERLY REPORT UNDER SECTION 13 OR 15
(D)<br> OF THE SECURITIES EXCHANGE ACT OF 1934</p>
<img src="spacer.gif" height="10" width="1"><br>
<div style="border: 1px; width: 602px; padding-top: 24px" align="center">
<table cellpadding="0" cellspacing="0" border="0" width="602" bgcolor="#ffffff">
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<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="301"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="8"></td>
<!--col #: 2 / width: 301 / data-type: text--><td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="301"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
</tr>
<tr>
<td style="font-family: serif; font-size: 9pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 0pt; text-indent: 0pt;padding-top: 0pt" align="center" valign="top" colspan="3">For
the quarterly period<br>ended September 30, 2004</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 9pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 0pt; text-indent: 0pt;padding-top: 0pt" align="center" valign="top" colspan="3">Commission
File Number 1-11398</td>
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<td><img src="spacer.gif" height="10" width="1"></td>
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<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: center; font-style: normal; line-height: 12pt; padding-top: 12pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 6pt; background-color: #ffffff;">CPI AEROSTRUCTURES,
INC.<br>
<font style="font-weight: normal; font-style: normal">(Exact Name of Small Business Issuer as Specified in its
Charter)</font>
</p>
<img src="spacer.gif" height="10" width="1"><br>
<div style="border: 1px; width: 602px; padding-top: 36px" align="center">
<table cellpadding="0" cellspacing="0" border="0" width="602" bgcolor="#ffffff">
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<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="238"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="8"></td>
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<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="8"></td>
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<td><img src="spacer.gif" height="1" width="238"></td>
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<tr>
<td style="font-family: serif; font-size: 9pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-left: 0pt; text-indent: 0pt;padding-top: 0pt" align="center" valign="top" colspan="3">New
York</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 9pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 0pt; text-indent: 0pt;padding-top: 0pt" align="center" valign="top" colspan="3">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 9pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-left: 0pt; text-indent: 0pt;padding-top: 0pt" align="center" valign="top" colspan="3">11-2520310</td>
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<td style="font-family: serif; font-size: 9pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 0pt; text-indent: 0pt;padding-top: 0pt" align="center" valign="top" colspan="3">(State
or Other Jurisdiction<br>of Incorporation or Organization)</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 9pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 0pt; text-indent: 0pt;padding-top: 0pt" align="center" valign="top" colspan="3">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 9pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 0pt; text-indent: 0pt;padding-top: 0pt" align="center" valign="top" colspan="3">(IRS Employer Identification
Number)</td>
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<td><img src="spacer.gif" height="10" width="1"></td>
</tr>
</table>
</div>
<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: center; font-style: normal; line-height: 12pt; padding-top: 12pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 0pt; background-color: #ffffff;">200A EXECUTIVE DRIVE, EDGEWOOD, NY
11717<br>
<font style="font-weight: normal; font-style: normal">(Address of Principal Executive Offices)</font>
</p>
<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: center; font-style: normal; line-height: 12pt; padding-top: 24pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 0pt; background-color: #ffffff;">
<font style="font-weight: normal; font-style: normal">Telephone number (631) 586-5200</font>
<br>
<font style="font-weight: normal; font-style: normal">(Issuer's Telephone Number Including Area Code)</font>
</p>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top:6pt; padding-left:0pt; padding-right:0pt; padding-bottom: 0pt; margin: 0pt; text-indent: 0pt; background-color: #ffffff">Check whether the issuer (1) filed all reports required to be
filed by Section 13 or 15 (d) of the Exchange Act during the past 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;&nbsp;&nbsp;&nbsp;Yes&nbsp;&nbsp;&nbsp;<img src="xbox.gif" alt="[X]" width="10" height="10">&nbsp;&nbsp;&nbsp;&nbsp;No&nbsp;&nbsp;&nbsp;<img src="ebox.gif" alt="[ ]" width="10" height="10"></p>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top:6pt; padding-left:0pt; padding-right:0pt; padding-bottom: 6pt; margin: 0pt; text-indent: 0pt; background-color: #ffffff">As of
November 9, 2004, the number of shares of common stock, par value $.001
per share, outstanding was
5,405,755.</p>
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<br>
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<br>






<page>
<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: center; font-style: normal; line-height: 12pt; padding-top: 12pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 6pt; background-color: #ffffff;">CPI AEROSTRUCTURES,
INC<br>INDEX</p>
<img src="spacer.gif" height="10" width="1"><br>
<div style="border: 1px; width: 602px; padding-top: 24px" align="center">
<table cellpadding="0" cellspacing="0" border="0" width="602" bgcolor="#ffffff">
<tr>
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<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="554"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="8"></td>
<!--col #: 2 / width: 37 / data-type: financial--><td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="37"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 10pt; text-indent: -10pt;padding-top: 12pt" align="left" valign="bottom" colspan="3">Part
I: Financial
Information:</td>
<td style="padding-top: 12pt "><img src="spacer.gif" height="1" width="2"></td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 20pt; text-indent: -10pt;padding-top: 12pt" align="left" valign="bottom" colspan="3">Item 1
&ndash; Condensed Financial Statements:</td>
<td style="padding-top: 12pt "><img src="spacer.gif" height="1" width="2"></td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 20pt; text-indent: -10pt;padding-top: 12pt" align="left" valign="bottom" colspan="3">Condensed
Balance Sheets as of September 30, 2004 (Unaudited) and December 31,
2003</td>
<td style="padding-top: 12pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 12pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 12pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">3</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 12pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 20pt; text-indent: -10pt;padding-top: 12pt" align="left" valign="bottom" colspan="3">Condensed Statements of Income for
the Three Months and Nine Months ended September 30, 2004 (Unaudited)
and 2003 (Unaudited)</td>
<td style="padding-top: 12pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 12pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 12pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">4</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 12pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 20pt; text-indent: -10pt;padding-top: 12pt" align="left" valign="bottom" colspan="3">Condensed Statements
of Cash Flows for the Nine Months ended September 30, 2004 (Unaudited)
and 2003 (Unaudited)</td>
<td style="padding-top: 12pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 12pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 12pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">5</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 12pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 20pt; text-indent: -10pt;padding-top: 12pt" align="left" valign="bottom" colspan="3">Notes to Condensed
Financial Statements (Unaudited)</td>
<td style="padding-top: 12pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 12pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 12pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">6</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 12pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 20pt; text-indent: -10pt;padding-top: 12pt" align="left" valign="bottom" colspan="3">Item 2
&ndash; Management's Discussion and Analysis of Financial
Condition and Results of Operations</td>
<td style="padding-top: 12pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 12pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 12pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">9</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 12pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 20pt; text-indent: -10pt;padding-top: 12pt" align="left" valign="bottom" colspan="3">Item
3 &ndash; Controls and Procedures</td>
<td style="padding-top: 12pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 12pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 12pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">13</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 12pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 10pt; text-indent: -10pt;padding-top: 12pt" align="left" valign="bottom" colspan="3">Part II. Other
Information</td>
<td style="padding-top: 12pt "><img src="spacer.gif" height="1" width="2"></td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 20pt; text-indent: -10pt;padding-top: 12pt" align="left" valign="bottom" colspan="3">Item 2 &ndash; Unregistered Sales of
Equity Securities and Use of Proceeds</td>
<td style="padding-top: 12pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 12pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 12pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">13</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 12pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 20pt; text-indent: -10pt;padding-top: 12pt" align="left" valign="bottom" colspan="3">Item 5 &ndash; Other Information</td>
<td style="padding-top: 12pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 12pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 12pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">13</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 12pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 20pt; text-indent: -10pt;padding-top: 12pt" align="left" valign="bottom" colspan="3">Item 6 &ndash; Exhibits and Reports on Form
8-K</td>
<td style="padding-top: 12pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 12pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 12pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">13</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 12pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 20pt; text-indent: -10pt;padding-top: 12pt" align="left" valign="bottom" colspan="3">Signatures and
Certifications</td>
<td style="padding-top: 12pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 12pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 12pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">14</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 12pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td><img src="spacer.gif" height="10" width="1"></td>
</tr>
</table>
</div>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt; text-align: center; width: 456pt;">2</p>
<br>
<hr width="760" style="padding-left: 0pt;" align="left">
<br>






<page>
<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: center; font-style: normal; line-height: 12pt; padding-top: 12pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 0pt; background-color: #ffffff;">CPI AEROSTRUCTURES,
INC.</p>
<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top: 12pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 0pt; background-color: #ffffff;">Part I:&nbsp;&nbsp;&nbsp;&nbsp;Financial Information:</p>
<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top: 12pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 0pt; background-color: #ffffff;">Item 1
&ndash; Financial Statements:</p>
<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: center; font-style: normal; line-height: 12pt; padding-top: 12pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 6pt; background-color: #ffffff;">CONDENSED BALANCE SHEETS</p>
<img src="spacer.gif" height="10" width="1"><br>
<div style="border: 1px; width: 602px; padding-top: 12px" align="center">
<table cellpadding="0" cellspacing="0" border="0" width="602" bgcolor="#ffffff">
<tr>
<!--col #: 1 / width: 412 / data-type: text-->
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="412"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="8"></td>
<!--col #: 2 / width: 84 / data-type: financial--><td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="84"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="8"></td>
<!--col #: 3 / width: 84 / data-type: financial--><td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="84"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
</tr>
<tr>
<td style="font-family: serif; font-size: 8pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="center" valign="bottom" colspan="3">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 8pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="center" valign="bottom" colspan="3">September
30,<br>2004</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 8pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="center" valign="bottom" colspan="3">December
31,<br>2003</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 8pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="center" valign="bottom" colspan="3">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 8pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="center" valign="bottom" colspan="3">(Unaudited)</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3"><b>ASSETS</b></td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Current
assets:</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 20pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Cash</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">1,543,196</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">
2,794,310</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 20pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Accounts
receivable</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">2,683,622</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">1,747,824</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 20pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Costs and estimated earnings in excess of billings on
uncompleted contracts</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">22,011,131</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">17,449,887</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 20pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Deferred income
taxes</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">&mdash;</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">1,058,000</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 20pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Prepaid expenses and other current
assets</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">305,980</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">349,329</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 30pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3"><b>Total current
assets</b></td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">26,543,929</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">23,399,350</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Property, plant and equipment,
net</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">546,389</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">360,514</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Other
assets</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">179,226</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">179,226</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 30pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3"><b>Total
assets</b></td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">27,269,544</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">23,939,090</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3"><b>LIABILITIES AND SHAREHOLDERS'
EQUITY</b></td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Current
liabilities:</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 20pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Accounts
payable</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">3,379,513</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;"> 3,343,875</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 20pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Accrued
expenses</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">272,245</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">541,798</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 20pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Current portion of long term
debt</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">63,459</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">7,303</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 20pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Income tax
payable</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">182,000</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">187,000</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 30pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3"><b>Total current
liabilities</b></td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">3,897,217</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">4,079,976</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Long term debt, net of current
portion</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">127,445</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">26,311</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 30pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3"><b>Total
liabilities</b></td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">4,024,662</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">4,106,287</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Commitments and contingencies</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Shareholders' equity:</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 20pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Common
stock - $.001 par value; authorized 50,000,000 shares, issued 5,436,770
and 5,301,770 shares, respectively and outstanding 5,405,755 and
5,301,770 shares, respectively</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">5,437</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">5,302</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 20pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Additional paid-in
capital</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">22,505,765</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">21,713,447</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 20pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Retained earnings (accumulated
deficit)</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">1,054,536</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">(1,885,946</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">)&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">23,565,738</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">19,832,803</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Less: Treasury Stock, at
cost</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">(320,856</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">)&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">&mdash;</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 30pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3"><b>Shareholders'
equity</b></td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">23,244,882</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">19,832,803</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 30pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3"><b>Total liabilities and shareholders'
equity</b></td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">27,269,544</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">23,939,090</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td><img src="spacer.gif" height="10" width="1"></td>
</tr>
</table>
</div>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt;  width: 456pt; text-align: center; font-style: normal; line-height: 22pt; padding-top:6pt; padding-left:0pt; padding-right:0pt; padding-bottom: 6pt; margin: 0pt; text-indent: 20pt; background-color: #ffffff">See
Notes to Condensed Financial Statements</p>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt; text-align: center; width: 456pt;">3</p>
<br>
<hr width="760" style="padding-left: 0pt;" align="left">
<br>
<page>
<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: center; font-style: normal; line-height: 12pt; padding-top: 12pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 0pt; background-color: #ffffff;">CPI AEROSTRUCTURES, INC.</p>
<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: center; font-style: normal; line-height: 12pt; padding-top: 12pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 6pt; background-color: #ffffff;">CONDENSED
STATEMENTS OF INCOME</p>
<img src="spacer.gif" height="10" width="1"><br>
<div style="border: 1px; width: 602px; padding-top: 12px" align="center">
<table cellpadding="0" cellspacing="0" border="0" width="602" bgcolor="#ffffff">
<tr>
<!--col #: 1 / width: 253 / data-type: text-->
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="253"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="8"></td>
<!--col #: 2 / width: 77 / data-type: financial--><td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="77"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="8"></td>
<!--col #: 3 / width: 77 / data-type: financial--><td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="77"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="8"></td>
<!--col #: 4 / width: 77 / data-type: financial--><td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="77"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="8"></td>
<!--col #: 5 / width: 77 / data-type: financial--><td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="77"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
</tr>
<tr>
<td style="font-family: serif; font-size: 8pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="center" valign="bottom" colspan="3">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 8pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="center" valign="bottom" colspan="7">For the Three Months<br>
Ended September 30,</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 8pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="center" valign="bottom" colspan="7">For the Nine Months<br>Ended
September 30,</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 8pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="center" valign="bottom" colspan="3">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 8pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="center" valign="bottom" colspan="3">2004</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 8pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="center" valign="bottom" colspan="3">2003</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 8pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="center" valign="bottom" colspan="3">2004</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 8pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="center" valign="bottom" colspan="3">2003</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 8pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="center" valign="bottom" colspan="3">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 8pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="center" valign="bottom" colspan="7">(Unaudited)</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 8pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="center" valign="bottom" colspan="7">(Unaudited)</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Revenue</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">7,877,023</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">7,851,067</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">21,297,456</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">20,752,731</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Cost of sales
</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">5,183,011</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">5,329,091</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">14,290,873</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">14,049,424</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Gross
profit</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">2,694,012</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">2,521,976</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">7,006,583</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">6,703,307</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Selling, general and administrative
expenses</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">728,613</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">723,160</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">2,405,263</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">2,362,480</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Income from
operations</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">1,965,399</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">1,798,816</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">4,601,320</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">4,340,827</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Other
income (expense):</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 20pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Interest/other
income</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">1,549</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">5,577</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">5,353</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">13,341</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 20pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Interest
expense</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">(1,477</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">)&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">(825</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">)&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">(5,191</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">)&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">(142,159</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">)&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 20pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Gain on
extinguishment of
debt</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">&mdash;</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">&mdash;</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">&mdash;</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">2,431,233</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Total other income (expense),
net</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">72</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">4,752</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">162</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">2,302,415</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Income from continuing operations
</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">1,965,471</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">1,803,568</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">4,601,482</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">6,643,242</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Gain on sale of
assets held for sale<br>&ndash; discontinued
operations</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">&mdash;</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">41,236</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">&mdash;</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">461,235</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Income before provision
for income taxes </td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">1,965,471</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">1,844,804</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">4,601,482</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">7,104,477</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Provision for
income taxes</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">640,000</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">&mdash;</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">1,661,000</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">&mdash;</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Net income
</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;"> 1,325,471</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">1,844,804</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;"> 2,940,482</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;"> 7,104,477</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Basic
net income per common share:</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 20pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Income from
continuing operations</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;"> 0.25</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">
0.34</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">0.55</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;"> 1.40</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 20pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Gain on
sale of assets held for sale &ndash; discontinued operations
</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">0.00</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">0.01</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">0.00</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">0.10</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Earnings per common share
&ndash; basic</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;"> 0.25</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">
0.35</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">0.55</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;"> 1.50</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Diluted
net income per common share:</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 20pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Income from
continuing operations</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;"> 0.22</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;"> 0.29</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">0.48</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;"> 1.22</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 20pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Gain on sale of assets held for
sale<br> &ndash; discontinued operations
</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">0.00</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">0.01</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">0.00</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">0.09</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Earnings per common share &ndash;
diluted</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;"> 0.22</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">
0.30</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">0.48</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;"> 1.31</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Shares used in
computing earnings per common share:</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 20pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Basic</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">5,405,184</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">5,217,733</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">5,358,025</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">4,730,803</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 20pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Diluted</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">6,132,425</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">6,053,689</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">6,091,338</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">5,426,145</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td><img src="spacer.gif" height="10" width="1"></td>
</tr>
</table>
</div>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt;  width: 456pt; text-align: center; font-style: normal; line-height: 22pt; padding-top:6pt; padding-left:0pt; padding-right:0pt; padding-bottom: 6pt; margin: 0pt; text-indent: 20pt; background-color: #ffffff">See Notes to
Condensed Financial Statements</p>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt; text-align: center; width: 456pt;">4</p>
<br>
<hr width="760" style="padding-left: 0pt;" align="left">
<br>
<page>
<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: center; font-style: normal; line-height: 12pt; padding-top: 12pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 0pt; background-color: #ffffff;">CPI AEROSTRUCTURES, INC.</p>
<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: center; font-style: normal; line-height: 12pt; padding-top: 12pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 6pt; background-color: #ffffff;">CONDENSED
STATEMENTS OF CASH FLOWS</p>
<img src="spacer.gif" height="10" width="1"><br>
<div style="border: 1px; width: 602px; padding-top: 12px" align="center">
<table cellpadding="0" cellspacing="0" border="0" width="602" bgcolor="#ffffff">
<tr>
<!--col #: 1 / width: 412 / data-type: text-->
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="412"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="8"></td>
<!--col #: 2 / width: 84 / data-type: financial--><td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="84"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="8"></td>
<!--col #: 3 / width: 84 / data-type: financial--><td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="84"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
</tr>
<tr>
<td style="font-family: serif; font-size: 8pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="center" valign="bottom" colspan="3">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 8pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="center" valign="bottom" colspan="7">For the Nine
Months<br>Ended September
30,</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 8pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="center" valign="bottom" colspan="3">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 8pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="center" valign="bottom" colspan="3">2004</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 8pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="center" valign="bottom" colspan="3">2003</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 8pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="center" valign="bottom" colspan="3">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 8pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="center" valign="bottom" colspan="7">(Unaudited)</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Cash
flows from operating activities:</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 20pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Net income
from continuing
operations</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">2,940,482</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">6,643,242</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Adjustments to reconcile net income from continuing
operations to net cash provided by (used in) operating
activities:</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 20pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Depreciation and
amortization</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">119,785</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">91,694</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 20pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Warrants issued for consulting
fees</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">&mdash;</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">60,506</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 20pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Common
stock issued for bank fees</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">&mdash;</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">88,669</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 20pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Gain on extinguishment of debt</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">&mdash;</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">(2,431,233</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">)&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 20pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Deferred income
taxes</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">1,058,000</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">&mdash;</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 20pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Tax
benefit for stock options</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">421,000</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">&mdash;</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 20pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Changes in operating assets and
liabilities:</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 30pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Increase in accounts
receivable</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">(935,798</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">)&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">(2,590</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">)&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 30pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Increase in costs and estimated earnings in excess of
billings on uncompleted
contracts</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">(4,561,244</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">)&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">(4,238,450</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">)&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 30pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Decrease in prepaid expenses and other current
assets</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">43,349</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">397,961</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 30pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Decrease in accounts payable and accrued
expenses</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">(233,916</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">)&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">(367,684</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">)&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 30pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Decrease in income taxes
payable</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">(5,000</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">)&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">&mdash;</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 40pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Net cash provided by (used in)
operating activities</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">(1,153,342</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">)&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">242,115</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Cash used in investing activities
&ndash; purchase of property, plant and
equipment</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">(305,664</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">)&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">(182,392</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">)&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Cash flows from financing
activities:</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 20pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">New borrowing &ndash; long term
debt</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">170,000</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">&mdash;</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 20pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Repayment of long-term
debt</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">(12,708</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">)&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">(5,580,267</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">)&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 20pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Proceeds from exercise of stock
options/warrants</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">50,600</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">642,516</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 20pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Proceeds from public
offering</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">&mdash;</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">7,756,668</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 40pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Net cash provided by financing
activities</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">207,892</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">2,818,917</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Net cash provided by (used in) continuing
operations</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">(1,251,114</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">)&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">2,878,640</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Net cash from discontinued
operations</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">&mdash;</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">741,911</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Net (decrease) increase in
cash</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">(1,251,114</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">)&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">3,620,551</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Cash at
beginning of
period</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">2,794,310</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">91,537</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Cash at end of
period</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">1,543,196</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">
3,712,088</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Supplemental disclosures of
cash flow information:</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Cash paid during
the period
for:</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 20pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Interest</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">5,191</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">
108,177</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 20pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Income
taxes</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">218,037</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">
8,610</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td><img src="spacer.gif" height="10" width="1"></td>
</tr>
</table>
</div>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt;  width: 456pt; text-align: center; font-style: normal; line-height: 22pt; padding-top:6pt; padding-left:0pt; padding-right:0pt; padding-bottom: 6pt; margin: 0pt; text-indent: 20pt; background-color: #ffffff">See Notes to Condensed Financial
Statements</p>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt; text-align: center; width: 456pt;">5</p>
<br>
<hr width="760" style="padding-left: 0pt;" align="left">
<br>






<page>
<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: center; font-style: normal; line-height: 12pt; padding-top: 12pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 0pt; background-color: #ffffff;">CPI
AEROSTRUCTURES INC.</p>
<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: center; font-style: normal; line-height: 12pt; padding-top: 12pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 6pt; background-color: #ffffff;">NOTES TO CONDENSED FINANCIAL
STATEMENTS (UNAUDITED)</p>
<img src="spacer.gif" height="10" width="1"><br>
<div style="border: 1px; width: 602px; padding-top: 12px" align="center">
<table cellpadding="0" cellspacing="0" border="0" width="602" bgcolor="#ffffff">
<tr>
<!--col #: 1 / width: 16 / data-type: text-->
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="16"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="8"></td>
<!--col #: 2 / width: 118 / data-type: text--><td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="118"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="8"></td>
<!--col #: 3 / width: 450 / data-type: text--><td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="450"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
</tr>
<tr>
<td style="font-family: serif; font-size: 9pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 0pt; text-indent: 0pt;padding-top: 0pt" align="left" valign="top" colspan="3"><b>1.</b></td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 9pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 0pt; text-indent: 0pt;padding-top: 0pt" align="left" valign="top" colspan="3"><b>INTERIM<br>
FINANCIAL<br> STATEMENTS:</b></td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 9pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 0pt; text-indent: 0pt;padding-top: 0pt" align="left" valign="top" colspan="3">The
financial statements as of September 30, 2004 and for the three months
and nine months ended September 30, 2004 and 2003 are unaudited,
however, in the opinion of the management of CPI Aerostructures, Inc.
("Company"), these financial statements
reflect all adjustments (consisting solely of normal recurring
adjustments) necessary to present fairly the financial position of the
Company and the results of operations. The results of operations for
such interim periods are not necessarily indicative of the results to
be obtained for a full
year.</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 9pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 0pt; text-indent: 0pt;padding-top: 8pt" align="left" valign="top" colspan="3">&nbsp;</td>
<td style="padding-top: 8pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 9pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 0pt; text-indent: 0pt;padding-top: 8pt" align="left" valign="top" colspan="3">&nbsp;</td>
<td style="padding-top: 8pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 9pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 0pt; text-indent: 0pt;padding-top: 8pt" align="left" valign="top" colspan="3">The
Company has elected to apply Accounting Principles Board
("APB") Opinion No. 25, <font style="font-weight: normal; font-style: italic">Accounting for
Stock Issued to Employees</font>, and related interpretations in
accounting for its stock options issued to employees (intrinsic value)
and has adopted the disclosure-only provisions of Statements of
Financial Accounting Standards ("SFAS") No.
123, <font style="font-weight: normal; font-style: italic">Accounting for Stock-Based Compensation, </font>and No. 148,
<font style="font-weight: normal; font-style: italic">Accounting for Stock-Based Compensation-Transition and
Disclosure</font>. Because the exercise price of the Company's stock
options equals the market price of the underlying stock on the date of
grant, no compensation expense was recognized during the three month
and nine month periods ended September 30, 2004 and 2003. Had the
Company elected to recognize compensation cost based on the fair value
of the options granted at the grant date as prescribed by SFAS No. 123,
the Company's net income and income per common share would have
been as
follows:</td>
</tr>
<tr>
<td><img src="spacer.gif" height="10" width="1"></td>
</tr>
</table>
</div>
<img src="spacer.gif" height="10" width="1"><br>
<div style="border: 1px; width: 602px; padding-top: 17.04px" align="right">
<table cellpadding="0" cellspacing="0" border="0" width="450" bgcolor="#ffffff">
<tr>
<!--col #: 1 / width: 317 / data-type: text-->
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="317"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="8"></td>
<!--col #: 2 / width: 56 / data-type: financial--><td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="56"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="8"></td>
<!--col #: 3 / width: 56 / data-type: financial--><td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="56"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
</tr>
<tr>
<td style="font-family: serif; font-size: 8pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="left" valign="bottom" colspan="3">Three
months ended September 30,</td>
<td style="border-bottom: 1px solid #000000"><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 8pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="center" valign="bottom" colspan="3">2004</td>
<td style="border-bottom: 1px solid #000000"><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 8pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="center" valign="bottom" colspan="3">2003</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Net income &ndash; as
reported</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">1,325,471</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">1,844,804</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Deduct: Total stock-based employee
compensation expense determined under fair value based method for all
awards, net of related tax
effects</td>
<td style="border-bottom: 1px solid #000000"><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">123,597</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px solid #000000; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="border-bottom: 1px solid #000000"><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">347,967</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px solid #000000; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #000000 ;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Net income &ndash; pro
forma</td>
<td style="border-bottom: 3px double #000000"><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">1,201,874</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #000000; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="border-bottom: 3px double #000000"><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">1,496,837</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #000000; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Basic
income per share &ndash; as reported</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;"> 0.25</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">
0.35</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Basic income per share &ndash;
pro forma</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: bold;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;"> 0.22</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: bold; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: bold;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;"> 0.29</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: bold; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Diluted
income per share &ndash; as reported</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;"> 0.22</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">
0.30</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 3px double #000000 ;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Diluted
income per share &ndash; pro forma</td>
<td style="border-bottom: 3px double #000000"><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 3px double #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: bold;  font-style: normal;  border-bottom: 3px double #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;"> 0.20</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: bold; font-style: normal;     border-bottom: 3px double #000000; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="border-bottom: 3px double #000000"><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 3px double #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: bold;  font-style: normal;  border-bottom: 3px double #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">
0.25</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: bold; font-style: normal;     border-bottom: 3px double #000000; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td><img src="spacer.gif" height="10" width="1"></td>
</tr>
</table>
</div>
<img src="spacer.gif" height="10" width="1"><br>
<div style="border: 1px; width: 602px; padding-top: 17.04px" align="right">
<table cellpadding="0" cellspacing="0" border="0" width="450" bgcolor="#ffffff">
<tr>
<!--col #: 1 / width: 317 / data-type: text-->
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="317"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="8"></td>
<!--col #: 2 / width: 56 / data-type: financial--><td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="56"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="8"></td>
<!--col #: 3 / width: 56 / data-type: financial--><td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="56"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
</tr>
<tr>
<td style="font-family: serif; font-size: 8pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="left" valign="bottom" colspan="3">Nine
months ended September 30,</td>
<td style="border-bottom: 1px solid #000000"><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 8pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="center" valign="bottom" colspan="3">2004</td>
<td style="border-bottom: 1px solid #000000"><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 8pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="center" valign="bottom" colspan="3">2003</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Net income &ndash; as
reported</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">2,940,482</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">7,104,477</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Deduct: Total stock-based employee
compensation expense determined under fair value based method for all
awards, net of related tax
effects</td>
<td style="border-bottom: 1px solid #000000"><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">353,268</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px solid #000000; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="border-bottom: 1px solid #000000"><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">513,482</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px solid #000000; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #000000 ;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Net income &ndash; pro
forma</td>
<td style="border-bottom: 3px double #000000"><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">2,587,214</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #000000; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="border-bottom: 3px double #000000"><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">6,590,995</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #000000; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Basic
income per share &ndash; as reported</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;"> 0.55</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">
1.50</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Basic income per share &ndash;
pro forma</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: bold;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;"> 0.48</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: bold; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: bold;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;"> 1.39</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: bold; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Diluted
income per share &ndash; as reported</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;"> 0.48</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">
1.31</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 3px double #000000 ;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Diluted
income per share &ndash; pro forma</td>
<td style="border-bottom: 3px double #000000"><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 3px double #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: bold;  font-style: normal;  border-bottom: 3px double #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;"> 0.42</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: bold; font-style: normal;     border-bottom: 3px double #000000; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="border-bottom: 3px double #000000"><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 3px double #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: bold;  font-style: normal;  border-bottom: 3px double #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">
1.21</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: bold; font-style: normal;     border-bottom: 3px double #000000; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td><img src="spacer.gif" height="10" width="1"></td>
</tr>
</table>
</div>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt; text-align: center; width: 456pt;">6</p>
<br>
<hr width="760" style="padding-left: 0pt;" align="left">
<br>
<page>
<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: center; font-style: normal; line-height: 12pt; padding-top: 12pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 0pt; background-color: #ffffff;">CPI
AEROSTRUCTURES INC.</p>
<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: center; font-style: normal; line-height: 12pt; padding-top: 12pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 6pt; background-color: #ffffff;">NOTES TO CONDENSED FINANCIAL
STATEMENTS (UNAUDITED)</p>
<img src="spacer.gif" height="10" width="1"><br>
<div style="border: 1px; width: 602px; padding-top: 12px" align="center">
<table cellpadding="0" cellspacing="0" border="0" width="602" bgcolor="#ffffff">
<tr>
<!--col #: 1 / width: 16 / data-type: text-->
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="16"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="8"></td>
<!--col #: 2 / width: 118 / data-type: text--><td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="118"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="8"></td>
<!--col #: 3 / width: 450 / data-type: text--><td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="450"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
</tr>
<tr>
<td style="font-family: serif; font-size: 9pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 0pt; text-indent: 0pt;padding-top: 0pt" align="left" valign="top" colspan="3"><b>2.</b></td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 9pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 0pt; text-indent: 0pt;padding-top: 0pt" align="left" valign="top" colspan="3"><b>COSTS
AND<br> ESTIMATED EARNINGS IN<br> EXCESS OF<br> BILLINGS ON<br>
UNCOMPLETED CONTRACTS:</b></td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 9pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 0pt; text-indent: 0pt;padding-top: 0pt" align="left" valign="top" colspan="3">Costs and estimated earnings in
excess of billings on uncompleted contracts consist
of:</td>
</tr>
<tr>
<td><img src="spacer.gif" height="10" width="1"></td>
</tr>
</table>
</div>
<img src="spacer.gif" height="10" width="1"><br>
<div style="border: 1px; width: 602px; padding-top: 0px" align="right">
<table cellpadding="0" cellspacing="0" border="0" width="450" bgcolor="#ffffff">
<tr>
<!--col #: 1 / width: 206 / data-type: text-->
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="206"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="8"></td>
<!--col #: 2 / width: 71 / data-type: financial--><td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="71"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="8"></td>
<!--col #: 3 / width: 71 / data-type: financial--><td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="71"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="8"></td>
<!--col #: 4 / width: 71 / data-type: financial--><td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="71"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
</tr>
<tr>
<td style="font-family: serif; font-size: 8pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="center" valign="bottom" colspan="3">&nbsp;</td>
<td style="border-bottom: 1px solid #000000"><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 8pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="center" valign="bottom" colspan="11">September
30, 2004</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 8pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="center" valign="bottom" colspan="3">&nbsp;</td>
<td style="border-bottom: 1px solid #000000"><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 8pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="center" valign="bottom" colspan="3">U.S.<br>Government</td>
<td style="border-bottom: 1px solid #000000"><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 8pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="center" valign="bottom" colspan="3">Commercial</td>
<td style="border-bottom: 1px solid #000000"><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 8pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="center" valign="bottom" colspan="3">Total</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Costs incurred on uncompleted
contracts</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">28,311,827</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">13,272,421</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">41,584,248</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Estimated
earnings</td>
<td style="border-bottom: 1px solid #000000"><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">17,209,064</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px solid #000000; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="border-bottom: 1px solid #000000"><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">6,141,068</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px solid #000000; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="border-bottom: 1px solid #000000"><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">23,350,132</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px solid #000000; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">45,520,891</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">19,413,489</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">64,934,380</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Less billings to
date</td>
<td style="border-bottom: 1px solid #000000"><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">25,219,061</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px solid #000000; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="border-bottom: 1px solid #000000"><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">17,704,188</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px solid #000000; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="border-bottom: 1px solid #000000"><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">42,923,249</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px solid #000000; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #000000 ;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3"><b>Costs and estimated earnings<br>in
excess of billings on<br>uncompleted
contracts</b></td>
<td style="border-bottom: 3px double #000000"><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">20,301,830</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #000000; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="border-bottom: 3px double #000000"><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">1,709,301</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #000000; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="border-bottom: 3px double #000000"><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">22,011,131</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #000000; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td><img src="spacer.gif" height="10" width="1"></td>
</tr>
</table>
</div>
<img src="spacer.gif" height="10" width="1"><br>
<div style="border: 1px; width: 602px; padding-top: 17.04px" align="right">
<table cellpadding="0" cellspacing="0" border="0" width="450" bgcolor="#ffffff">
<tr>
<!--col #: 1 / width: 206 / data-type: text-->
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="206"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="8"></td>
<!--col #: 2 / width: 71 / data-type: financial--><td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="71"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="8"></td>
<!--col #: 3 / width: 71 / data-type: financial--><td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="71"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="8"></td>
<!--col #: 4 / width: 71 / data-type: financial--><td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="71"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
</tr>
<tr>
<td style="font-family: serif; font-size: 8pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="center" valign="bottom" colspan="3">&nbsp;</td>
<td style="border-bottom: 1px solid #000000"><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 8pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="center" valign="bottom" colspan="11">December
31, 2003</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 8pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="center" valign="bottom" colspan="3">&nbsp;</td>
<td style="border-bottom: 1px solid #000000"><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 8pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="center" valign="bottom" colspan="3">U.S.<br>Government</td>
<td style="border-bottom: 1px solid #000000"><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 8pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="center" valign="bottom" colspan="3">Commercial</td>
<td style="border-bottom: 1px solid #000000"><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 8pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="center" valign="bottom" colspan="3">Total</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Costs incurred on uncompleted
contracts</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">22,466,590</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">13,184,968</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">35,651,558</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Estimated
earnings</td>
<td style="border-bottom: 1px solid #000000"><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">11,783,814</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px solid #000000; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="border-bottom: 1px solid #000000"><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">6,111,775</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px solid #000000; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="border-bottom: 1px solid #000000"><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">17,895,589</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px solid #000000; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">34,250,404</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">19,296,743</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">53,547,147</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Less billings to
date</td>
<td style="border-bottom: 1px solid #000000"><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">18,866,180</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px solid #000000; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="border-bottom: 1px solid #000000"><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">17,231,080</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px solid #000000; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="border-bottom: 1px solid #000000"><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 1px solid #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">36,097,260</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px solid #000000; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #000000 ;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3"><b>Costs and estimated earnings<br>in
excess of billings on<br>uncompleted
contracts</b></td>
<td style="border-bottom: 3px double #000000"><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">15,384,224</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #000000; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="border-bottom: 3px double #000000"><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;"> 2,065,663</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #000000; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="border-bottom: 3px double #000000"><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #000000 ;padding-top: 0pt" align="right" valign="bottom" colspan="1">$</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #000000 ; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">17,449,887</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #000000; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td><img src="spacer.gif" height="10" width="1"></td>
</tr>
</table>
</div>
<img src="spacer.gif" height="10" width="1"><br>
<div style="border: 1px; width: 602px; padding-top: 12px" align="center">
<table cellpadding="0" cellspacing="0" border="0" width="602" bgcolor="#ffffff">
<tr>
<!--col #: 1 / width: 16 / data-type: text-->
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="16"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="8"></td>
<!--col #: 2 / width: 118 / data-type: text--><td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="118"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="8"></td>
<!--col #: 3 / width: 450 / data-type: text--><td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="450"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
</tr>
<tr>
<td style="font-family: serif; font-size: 9pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 0pt; text-indent: 0pt;padding-top: 0pt" align="left" valign="top" colspan="3"><b>3.</b></td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 9pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 0pt; text-indent: 0pt;padding-top: 0pt" align="left" valign="top" colspan="3"><b>EARNINGS
PER<br> COMMON SHARE:</b></td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 9pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 0pt; text-indent: 0pt;padding-top: 0pt" align="left" valign="top" colspan="3">Basic earnings per common share is
computed using the weighted average number of shares outstanding.
Diluted earnings per common share is computed using the
weighted-average number of shares outstanding adjusted for the
incremental shares attributed to outstanding options and warrants to
purchase common stock. Incremental shares of 727,241 and 733,313 were
used in the calculation of diluted earnings per common share in the
three-month and nine-month periods ended September 30, 2004,
respectively. Incremental shares of 835,956 and 695,342 were used in
the calculation of diluted earnings per common share in the three-month
and nine-month periods ended September 30, 2003,
respectively.</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 9pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 0pt; text-indent: 0pt;padding-top: 16pt" align="left" valign="top" colspan="3"><b>4.</b></td>
<td style="padding-top: 16pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 9pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 0pt; text-indent: 0pt;padding-top: 16pt" align="left" valign="top" colspan="3"><b>PUBLIC<br>
OFFERING<br> AND CREDIT<br> FACILITY:</b></td>
<td style="padding-top: 16pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 9pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 0pt; text-indent: 0pt;padding-top: 16pt" align="left" valign="top" colspan="3">In September 2003,
the Company entered into a three year, $5.0 million revolving credit
facility with JP Morgan Chase Bank, secured by the assets of the
Company. The facility specifies interest rates that range between the
Prime Rate and 225 basis points over LIBOR, depending on certain terms
and conditions. As of September 30, 2004, the Company had not borrowed
any funds pursuant to this
facility.</td>
</tr>
<tr>
<td><img src="spacer.gif" height="10" width="1"></td>
</tr>
</table>
</div>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt; text-align: center; width: 456pt;">7</p>
<br>
<hr width="760" style="padding-left: 0pt;" align="left">
<br>
<page>
<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: center; font-style: normal; line-height: 12pt; padding-top: 12pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 0pt; background-color: #ffffff;">CPI
AEROSTRUCTURES INC.</p>
<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: center; font-style: normal; line-height: 12pt; padding-top: 12pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 6pt; background-color: #ffffff;">NOTES TO CONDENSED FINANCIAL
STATEMENTS (UNAUDITED)</p>
<img src="spacer.gif" height="10" width="1"><br>
<div style="border: 1px; width: 602px; padding-top: 12px" align="center">
<table cellpadding="0" cellspacing="0" border="0" width="602" bgcolor="#ffffff">
<tr>
<!--col #: 1 / width: 16 / data-type: text-->
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="16"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="8"></td>
<!--col #: 2 / width: 118 / data-type: text--><td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="118"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="8"></td>
<!--col #: 3 / width: 450 / data-type: text--><td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="450"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
</tr>
<tr>
<td style="font-family: serif; font-size: 9pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 0pt; text-indent: 0pt;padding-top: 8pt" align="left" valign="top" colspan="3">&nbsp;</td>
<td style="padding-top: 8pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 9pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 0pt; text-indent: 0pt;padding-top: 8pt" align="left" valign="top" colspan="3">&nbsp;</td>
<td style="padding-top: 8pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 9pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 0pt; text-indent: 0pt;padding-top: 8pt" align="left" valign="top" colspan="3">In
February 2003, the Company consummated a public offering of 2,300,000
shares of common stock, which provided the Company with net proceeds of
$7,759,000. Approximately $2,433,000 of the net proceeds was used to
repay bank loans, $2,700,000 was used to repay a promissory note held
by a third party, which had a carrying value plus accrued interest of
approximately $5,131,000. Accordingly, the Company recorded a gain of
approximately $2,431,000 on the extinguishment of the debt. The
remaining net proceeds of approximately $2,626,000 have been and are
being used to fund continuing
operations.</td>
</tr>
<tr>
<td><img src="spacer.gif" height="10" width="1"></td>
</tr>
</table>
</div>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt; text-align: center; width: 456pt;">8</p>
<br>
<hr width="760" style="padding-left: 0pt;" align="left">
<br>






<page>
<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: center; font-style: normal; line-height: 12pt; padding-top: 12pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 0pt; background-color: #ffffff;">CPI
AEROSTRUCTURES, INC.</p>
<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top: 12pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 0pt; background-color: #ffffff;">Item 2 &ndash;
Management's Discussion and Analysis of Financial Condition and
Results of Operations</p>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top:6pt; padding-left:0pt; padding-right:0pt; padding-bottom: 0pt; margin: 0pt; text-indent: 20pt; background-color: #ffffff">The following discussion should be read
in conjunction with the Company's Condensed Financial Statements
and footnotes thereto contained in this report.</p>
<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top: 12pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 0pt; background-color: #ffffff;">Forward Looking
Statements</p>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top:6pt; padding-left:0pt; padding-right:0pt; padding-bottom: 0pt; margin: 0pt; text-indent: 20pt; background-color: #ffffff">The statements discussed in this Report include
forward looking statements that involve risks and uncertainties,
including the timely delivery and acceptance of the Company's
products and the other risks detailed from time to time in the
Company's reports filed with the Securities and Exchange
Commission.</p>
<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top: 12pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 0pt; background-color: #ffffff;">Critical Accounting Policies</p>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: italic; line-height: 11pt; padding-top: 6pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 10pt; padding-bottom: 0pt; background-color: #ffffff;">Revenue
Recognition</p>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top:6pt; padding-left:0pt; padding-right:0pt; padding-bottom: 0pt; margin: 0pt; text-indent: 20pt; background-color: #ffffff">We recognize revenue from our contracts over the
contractual period under the percentage-of-completion (POC) method of
accounting. Under the POC method of accounting, sales and gross profit
are recognized as work is performed based on the relationship between
actual costs incurred and total estimated costs at the completion of
the contract. Recognized revenues that will not be billed under the
terms of the contract until a later date are recorded as an asset
captioned "Costs and estimated earnings in excess of
billings on uncompleted contracts." Contracts where
billings to date have exceeded recognized revenues are recorded as a
liability captioned "Billings in excess of costs and
estimated earnings on uncompleted contracts." Changes to
the original estimates may be required during the life of the contract.
Estimates are reviewed monthly and the effect of any change in the
estimated gross margin percentage for a contract is reflected in cost
of sales in the period the change becomes known. The use of the POC
method of accounting involves considerable use of estimates in
determining revenues, costs and profits and in assigning the amounts to
accounting periods. As a result, there can be a significant disparity
between earnings (both for accounting and taxes) as reported and actual
cash received by us during any reporting period. We continually
evaluate all of the issues related to the assumptions, risks and
uncertainties inherent with the application of the POC method of
accounting; however we cannot assure that our estimates will be
accurate. If our estimates are not accurate or a contract is
terminated, we will be forced to adjust revenue in later periods.
Furthermore, even if our estimates are accurate, we may have a
shortfall in our cash flow and we may need to borrow money to pay taxes
until the reported earnings materialize to actual cash receipts.</p>
<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top: 12pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 0pt; background-color: #ffffff;">Results of Operations</p>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top:6pt; padding-left:0pt; padding-right:0pt; padding-bottom: 0pt; margin: 0pt; text-indent: 20pt; background-color: #ffffff">The Company's revenue for the
three months ended September 30, 2004 was $7,877,023 compared to
$7,851,067 for the same period last year, representing an increase of
$25,956, or 0.3%. For the nine months ended September 30, 2004,
revenue increased by $544,725, or 2.6%, to $21,297,456 compared
to $20,752,731 for the same period last year, due primarily to more
contracts in the current period.</p>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top:6pt; padding-left:0pt; padding-right:0pt; padding-bottom: 0pt; margin: 0pt; text-indent: 20pt; background-color: #ffffff">Gross profit for the three
months ended September 30, 2004 increased by $172,036 or 6.8%,
to $2,694,012 from $2,521,976 for the same period last year. As a
percentage of revenue, gross profit for the three months ended
September 30, 2004 was 34% compared to 32% for the same
period last year, due primarily to a more favorable product mix. For
the nine months ended September 30, 2004, gross profit was $7,006,583,
or 33% of revenue, compared with $6,703,307, or 32% of
revenue for the first nine months of last year. This increase was also
due primarily to a more favorable product mix.</p>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top:6pt; padding-left:0pt; padding-right:0pt; padding-bottom: 6pt; margin: 0pt; text-indent: 20pt; background-color: #ffffff">Selling, general,
and administrative expenses for the three months ended September 30,
2004 were $728,613 compared to $723,160 for the three months ended
September 30, 2003, an increase of $5,453, or 0.8%. For the
nine-month period ended September 30, 2004, selling, general and
administrative expenses were $2,405,263, compared to $2,362,480 for the
same period last year, an increase of $42,783 or 1.8%. These
increases were the result of normal price increases.</p>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt; text-align: center; width: 456pt;">9</p>
<br>
<hr width="760" style="padding-left: 0pt;" align="left">
<br>
<page>
<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: center; font-style: normal; line-height: 12pt; padding-top: 12pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 0pt; background-color: #ffffff;">CPI
AEROSTRUCTURES, INC.</p>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top:6pt; padding-left:0pt; padding-right:0pt; padding-bottom: 0pt; margin: 0pt; text-indent: 20pt; background-color: #ffffff">The resulting income from operations for
the three months ended September 30, 2004 was $1,965,399, an increase
of $166,583, or 9.3%, from $1,798,816 reported in the same
period last year. For the nine months ended September 30, 2004, income
from operations was $4,601,320 compared with $4,340,827 for the same
period last year, an increase of $260,493, or 6.0%. These
increases were the result of the higher gross margin achieved in the
current periods.</p>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top:6pt; padding-left:0pt; padding-right:0pt; padding-bottom: 0pt; margin: 0pt; text-indent: 20pt; background-color: #ffffff">Net interest income for the three months ended
September 30, 2004 was $72, compared to $4,752 for the three months
ended September 30, 2003, a decrease of $4,680. Net interest income for
the nine months ended September 30, 2004 was $162, compared with net
interest expense of $128,818 for the same period last year. The
decrease in interest expense was primarily due to bank fees associated
with the early extinguishment of the Company's bank debt in
February 2003.</p>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top:6pt; padding-left:0pt; padding-right:0pt; padding-bottom: 0pt; margin: 0pt; text-indent: 20pt; background-color: #ffffff">Included in other income for the nine months
ended September 30, 2003 is a gain on extinguishment of debt of
$2,431,233.</p>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top:6pt; padding-left:0pt; padding-right:0pt; padding-bottom: 0pt; margin: 0pt; text-indent: 20pt; background-color: #ffffff">Income from continuing operations for the three
months ended September 30, 2004 was $1,965,471 compared to $1,803,568
for the three months ended September 30, 2003. For the nine months
ended September 30, 2004, income from continuing operations was
$4,601,482 compared to $6,643,242 for the same period last year. The
decrease was primarily due to a gain on the extinguishment of debt of
$2,431,233, which was realized in conjunction with the public offering
of 2.3 million shares of the Company's common stock in February
2003.</p>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top:6pt; padding-left:0pt; padding-right:0pt; padding-bottom: 0pt; margin: 0pt; text-indent: 20pt; background-color: #ffffff">During the first nine months of fiscal 2003, the Company
realized a one time gain on the disposal of assets held for sale
&ndash; discontinued operations of $461,235, compared to no such amount
in the current year periods.</p>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top:6pt; padding-left:0pt; padding-right:0pt; padding-bottom: 0pt; margin: 0pt; text-indent: 20pt; background-color: #ffffff">As a result, income before
provision for income taxes for the three months ended September 30,
2004 was $1,965,471, or 25% of revenue, compared with
$1,844,804, or 23% of revenue for the same period last year. For
the nine months ended September 30, 2004, income before provision for
income taxes was $4,601,482 , or 22% of revenue, compared with
$7,104,477, or 34% of revenue for the same period last year.</p>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top:6pt; padding-left:0pt; padding-right:0pt; padding-bottom: 0pt; margin: 0pt; text-indent: 20pt; background-color: #ffffff">The Company recorded a provision for income taxes of $640,000 and
$1,661,000 for the three months and nine months ended September 30,
2004, respectively, and no provision for income taxes for the three
months and nine months ended September 30, 2003. However in preparing
the Company's 2003 federal income tax return, the Company
determined that there were additional net operating losses available to
apply against income subsequent to 2003. The Company is in the process
of analyzing the impact of this availability and the timing of
recognition of the benefit. The Company anticipates that it will
complete its analysis during the fourth quarter.</p>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top:6pt; padding-left:0pt; padding-right:0pt; padding-bottom: 0pt; margin: 0pt; text-indent: 20pt; background-color: #ffffff">Net income for
the three months ended September 30, 2004 was $1,325,471, or $0.25 per
basic share, compared with $1,844,804, or $0.35 per basic share for the
same period last year. For the nine months ended September 30, 2004,
net income was $2,940,482, or $0.55 per basic share, compared with
$7,104,477, or $1.50 per basic share for the same period last year.</p>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top:6pt; padding-left:0pt; padding-right:0pt; padding-bottom: 0pt; margin: 0pt; text-indent: 20pt; background-color: #ffffff">Diluted earnings per share for the three months ended September 30,
2004 were $.22, calculated utilizing 6,132,425 average shares
outstanding for the period, compared with diluted earnings per share of
$0.30, calculated utilizing 6,053,689 average shares outstanding for
the same period last year.</p>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top:6pt; padding-left:0pt; padding-right:0pt; padding-bottom: 0pt; margin: 0pt; text-indent: 20pt; background-color: #ffffff">Diluted earnings per share for the
nine months ended September 30, 2004 were $0.48, calculated utilizing
6,091,338 average shares outstanding for the period, compared with
diluted earnings per share of $1.31 calculated utilizing 5,426,145
average shares outstanding for the same period last year.</p>
<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top: 12pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 0pt; background-color: #ffffff;">Material Changes in Financial Condition</p>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top:6pt; padding-left:0pt; padding-right:0pt; padding-bottom: 6pt; margin: 0pt; text-indent: 20pt; background-color: #ffffff">A large portion of
the Company's cash is used in paying for materials and processing
costs associated with contracts that are in process and which do not
provide for progress payments. These costs are components of
"Costs and estimated earnings in excess of billings on
uncompleted contracts" </p>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt; text-align: center; width: 456pt;">10</p>
<br>
<hr width="760" style="padding-left: 0pt;" align="left">
<br>
<page>
<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: center; font-style: normal; line-height: 12pt; padding-top: 12pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 0pt; background-color: #ffffff;">CPI
AEROSTRUCTURES, INC.</p>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top:6pt; padding-left:0pt; padding-right:0pt; padding-bottom: 0pt; margin: 0pt; text-indent: pt; background-color: #ffffff">
on the Company's balance sheet and
represent the aggregate costs and related earnings for uncompleted
contracts for which the customer has not yet been billed. These costs
and earnings are recovered upon shipment of products and presentation
of billings in accordance with contract terms.</p>
<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top: 12pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 0pt; background-color: #ffffff;">Liquidity and
Capital Resources</p>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top:6pt; padding-left:0pt; padding-right:0pt; padding-bottom: 0pt; margin: 0pt; text-indent: 20pt; background-color: #ffffff">At September 30, 2004, the Company had
working capital of $22,646,712 compared to $19,319,374 at December 31,
2003, an increase of $3,327,338.</p>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top:6pt; padding-left:0pt; padding-right:0pt; padding-bottom: 0pt; margin: 0pt; text-indent: 20pt; background-color: #ffffff">Net cash used in operating
activities for the nine months ended September 30, 2004 was $1,153,342,
compared to net cash provided by operating activities of $242,115 for
the same period last year, predominantly the result of an increase in
accounts receivable and an increase in costs in excess of billing on
uncompleted contracts due to an increase in the number of contracts in
the current period.</p>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top:6pt; padding-left:0pt; padding-right:0pt; padding-bottom: 0pt; margin: 0pt; text-indent: 20pt; background-color: #ffffff">For the three months ended September 30,
2004 net cash provided by operating activities was $280,116, compared
to net cash provided by operating activities of $174,444 for the same
period last year, predominantly because costs in excess of billings on
uncompleted contracts increased by $1,354,573 in the three months ended
September 30, 2004 as compared to an increase of $2,296,805 for the
three months ended September 30, 2003, partially offset by slightly
lower net income and an increase in accounts receivable.</p>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top:6pt; padding-left:0pt; padding-right:0pt; padding-bottom: 0pt; margin: 0pt; text-indent: 20pt; background-color: #ffffff">The
Company currently finances its operations through a combination of
existing resources and as cash is provided by operations.</p>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top:6pt; padding-left:0pt; padding-right:0pt; padding-bottom: 0pt; margin: 0pt; text-indent: 20pt; background-color: #ffffff">In
February 2003, the Company consummated a public offering of 2,300,000
shares of common stock, which provided the Company with net proceeds of
$7,759,000. Approximately $2,433,000 of the net proceeds was used to
repay bank loans, $2,700,000 was used to repay a promissory note held
by a third party, which had a carrying value plus accrued interest of
approximately $5,131,000. Accordingly, the Company recorded a gain of
approximately $2,431,000 on the extinguishment of the debt. The
remaining net proceeds of approximately $2,626,000 have been and are
being used to fund continuing operations.</p>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top:6pt; padding-left:0pt; padding-right:0pt; padding-bottom: 0pt; margin: 0pt; text-indent: 20pt; background-color: #ffffff">In September 2003, the
Company entered into a three year, $5.0 million revolving credit
facility with JPMorgan Chase Bank, secured by the assets of the
Company. The facility specifies interest rates that range between the
Prime Rate and 225 basis points over LIBOR, depending on certain terms
and conditions. As of September 30, 2004, the Company had not borrowed
any funds pursuant to this facility.</p>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top:6pt; padding-left:0pt; padding-right:0pt; padding-bottom: 6pt; margin: 0pt; text-indent: 20pt; background-color: #ffffff">The Company believes, based
on its current backlog, its ability to bill its customers on a progress
basis and its expected work requirements, that its current liquidity
and capital resources, including its unused credit facility, are
sufficient to meet its needs for at least the next year.</p>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt; text-align: center; width: 456pt;">11</p>
<br>
<hr width="760" style="padding-left: 0pt;" align="left">
<br>
<page>
<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: center; font-style: normal; line-height: 12pt; padding-top: 12pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 0pt; background-color: #ffffff;">CPI
AEROSTRUCTURES, INC.</p>
<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top: 12pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 0pt; background-color: #ffffff;">Contractual Obligations</p>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top:6pt; padding-left:0pt; padding-right:0pt; padding-bottom: 6pt; margin: 0pt; text-indent: 20pt; background-color: #ffffff">The table
below summarizes information about our contractual obligations as of
September 30, 2004 and the effects these obligations are expected to
have on our liquidity and cash flow in the future years.</p>
<img src="spacer.gif" height="10" width="1"><br>
<div style="border: 1px; width: 602px; padding-top: 12px" align="center">
<table cellpadding="0" cellspacing="0" border="0" width="602" bgcolor="#ffffff">
<tr>
<!--col #: 1 / width: 222 / data-type: text-->
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="222"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="8"></td>
<!--col #: 2 / width: 65 / data-type: financial--><td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="65"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="8"></td>
<!--col #: 3 / width: 65 / data-type: financial--><td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="65"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="8"></td>
<!--col #: 4 / width: 65 / data-type: financial--><td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="65"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="8"></td>
<!--col #: 5 / width: 65 / data-type: financial--><td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="65"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="8"></td>
<!--col #: 6 / width: 65 / data-type: financial--><td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="65"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
</tr>
<tr>
<td style="font-family: serif; font-size: 8pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="left" valign="bottom" colspan="3" rowspan="2">Contractual
Obligations</td>
<td style="padding-top: 0pt " rowspan="2"><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 8pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="center" valign="bottom" colspan="19">Payments Due By Period
($)</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 8pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="center" valign="bottom" colspan="3">Total</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 8pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="center" valign="bottom" colspan="3">Less than<br>
1 year</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 8pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="center" valign="bottom" colspan="3">1-3 years</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 8pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="center" valign="bottom" colspan="3">4-5 years</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 8pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="center" valign="bottom" colspan="3">After 5
years</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Short-Term
Debt</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">0</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">0</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">0</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">0</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">0</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Long
Term
Obligations</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">190,904</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">63,459</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">124,972</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">2,473</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">0</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Operating
Leases</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">0</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">0</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">0</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">0</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">0</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Employment
Agreement Compensation
*</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">1,284,700</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">731,575</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">553,125</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">0</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">0</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="bottom" colspan="3">Total
Contractual Cash
Obligations</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">1,475,604</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">795,034</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">678,097</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">2,473</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="bottom" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="bottom" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">0</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 1px double #ffffff ; padding-top: 0pt " align="left" valign="bottom" nowrap="nowrap">&nbsp;</td>
</tr>
<tr>
<td><img src="spacer.gif" height="10" width="1"></td>
</tr>
</table>
</div>
<!--0-->
<table border="0" cellpadding="0" cellspacing="0" width="602">
<tr>
<td><img src="spacer.gif" width="1" height="8"></td>
</tr>
<tr>
<td bgcolor="#000000"><img src="spacer.gif" height="1"><img src="spacer.gif" height="1" width="78"></td>
<td><img src="spacer.gif" height="1" width="524"></td>
</tr>
<tr>
<td><img src="spacer.gif" height="8" width="1"></td>
</tr>
</table>
<table cellpadding="0" cellspacing="0" border="0" width="602">
<tr>
<td><img src="spacer.gif" height="1" width="23"></td>
<td><img src="spacer.gif" height="1" width="602"></td>
</tr>
<tr>
<td align="right" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt;  padding-left: 0pt; text-align: left">*</td>
<td align="left" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt;  padding-bottom: 6pt;">The
employment agreements provide for bonus payments that are excluded from
these amounts.</td>
</tr>
</table>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt; text-align: center; width: 456pt;">12</p>
<br>
<hr width="760" style="padding-left: 0pt;" align="left">
<br>
<page>
<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: center; font-style: normal; line-height: 12pt; padding-top: 12pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 0pt; background-color: #ffffff;">CPI
AEROSTRUCTURES, INC.</p>
<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top: 12pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 0pt; background-color: #ffffff;">Item 3 &ndash; Controls and
Procedures</p>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top:6pt; padding-left:0pt; padding-right:0pt; padding-bottom: 0pt; margin: 0pt; text-indent: 20pt; background-color: #ffffff">An evaluation of the effectiveness of the
Company's disclosure controls and procedures was made as of
September 30, 2004 under the supervision and with the participation of
the Company's management, including the Company's chief
executive officer and the Company's chief financial officer.
Based on that evaluation, they concluded that the Company's
disclosure controls and procedures are effective to ensure that
information required to be disclosed by the Company in reports that it
files or submits under the Securities Exchange Act of 1934 is recorded,
processed, summarized and reported within the time periods specified in
Securities and Exchange Commission rules and forms. During the most
recently completed fiscal quarter, there has been no change in the
Company's internal control over financial reporting that has
materially affected, or is reasonably likely to materially affect, the
Company's internal control over financial reporting.</p>
<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top: 12pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 0pt; background-color: #ffffff;">Part
II: Other Information</p>
<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top: 12pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 6pt; background-color: #ffffff;">Item 2:&nbsp;&nbsp;&nbsp;&nbsp;Unregistered Sales of
Equity
Securities</p>
<img src="spacer.gif" height="10" width="1"><br>
<div style="border: 1px; width: 602px; padding-top: 12px" align="center">
<table cellpadding="0" cellspacing="0" border="0" width="602" bgcolor="#ffffff">
<tr>
<!--col #: 1 / width: 92 / data-type: text-->
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="92"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="8"></td>
<!--col #: 2 / width: 92 / data-type: text--><td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="92"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="8"></td>
<!--col #: 3 / width: 92 / data-type: financial--><td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="92"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="8"></td>
<!--col #: 4 / width: 127 / data-type: text--><td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="127"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="8"></td>
<!--col #: 5 / width: 74 / data-type: financial--><td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="74"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="8"></td>
<!--col #: 6 / width: 74 / data-type: text--><td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="74"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
</tr>
<tr>
<td style="font-family: serif; font-size: 8pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="center" valign="bottom" colspan="3">Date
of Sale</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 8pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="center" valign="bottom" colspan="3">Title of Security</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 8pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="center" valign="bottom" colspan="3">Number
Sold</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 8pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="center" valign="bottom" colspan="3">Consideration Received<br> and Description of<br>
Underwriting or<br> Other Discounts to<br> Market Price
Afforded<br> To Purchasers</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 8pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="center" valign="bottom" colspan="3">Exemption<br> from<br>
Registration<br>Claimed</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 8pt; color: #000000; font-weight: bold; font-style: normal; border-bottom: 1px solid #000000 ;padding-top: 0pt" align="center" valign="bottom" colspan="3">If Option, Warrant<br> or
Convertible<br> Security, Terms of<br> Exercise or<br>
Conversion</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 10pt; text-indent: -10pt;padding-top: 0pt" align="center" valign="top" colspan="3">7/7/04</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 0pt; text-indent: 0pt;padding-top: 0pt" align="center" valign="top" colspan="3">Common<br>
Stock</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="top" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="top" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">7,500</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="top" nowrap="nowrap">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 0pt; text-indent: 0pt;padding-top: 0pt" align="left" valign="top" colspan="3">Common
stock<br> issued upon<br> exercise of<br> options; $18,975<br> cash
consideration<br> received by the<br>
Company</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-top: 0pt" align="right" valign="top" colspan="1">&nbsp;</td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal;  font-style: normal;  border-bottom: 3px double #ffffff; padding-left: 0pt; text-indent: 0pt;  padding-top: 0pt" align="right" valign="top" colspan="1" nowrap="nowrap"><font style="background-color: #ffffff;">4</font></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal;     border-bottom: 3px double #ffffff; padding-top: 0pt " align="left" valign="top" nowrap="nowrap">(2)&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 10pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 0pt; text-indent: 0pt;padding-top: 0pt" align="center" valign="top" colspan="3">N/A</td>
</tr>
<tr>
<td><img src="spacer.gif" height="10" width="1"></td>
</tr>
</table>
</div>
<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top: 12pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 0pt; background-color: #ffffff;">Item
5 &ndash; Other Information</p>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top:6pt; padding-left:0pt; padding-right:0pt; padding-bottom: 0pt; margin: 0pt; text-indent: 20pt; background-color: #ffffff">On June 16, 2004, the nominating
committee of the board of directors adopted and the board of directors
approved the Company's nominating committee charter, a copy of
which has been filed as Exhibit 99.1 to this Form 10-QSB. The
nominating committee is responsible for overseeing the selection of
persons to be nominated to serve on the Company's board of
directors. The nominating committee will consider persons identified by
its members, management, shareholders, investment bankers and others.
The nominating committee also established a method by which
shareholders may propose to the nominating committee candidates for
selection as nominees for directors, which is included as part of
Exhibit 99.1 to this Form 10-QSB.</p>
<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top: 12pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 0pt; background-color: #ffffff;">Item 6 &ndash; Exhibits and
Reports on Form 8-K</p>
<table cellpadding="0" cellspacing="0" border="0" width="602">
<tr>
<td><img src="spacer.gif" height="1" width="66"></td>
<td><img src="spacer.gif" height="1" width="24"></td>
<td><img src="spacer.gif" height="1" width="83"></td>
<td><img src="spacer.gif" height="1" width="429"></td>
</tr>
<tr>
<td align="left" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; font-style: normal; width: 50pt"></td>
<td align="right" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; padding-left: 0pt; text-align: left;  font-style: normal; width: 18pt">a)&nbsp;</td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; padding-bottom: 6pt; text-align: left; font-style: normal; width: 388pt">Exhibit
31.1</td>
<td style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top:6pt; padding-bottom: 6pt; text-align: left; font-style: normal; width: 388pt">Section 302 Certification by Chief Executive
Officer</td>
</tr>
</table>
<table cellpadding="0" cellspacing="0" border="0" width="602">
<tr>
<td><img src="spacer.gif" height="1" width="66"></td>
<td><img src="spacer.gif" height="1" width="24"></td>
<td><img src="spacer.gif" height="1" width="83"></td>
<td><img src="spacer.gif" height="1" width="429"></td>
</tr>
<tr>
<td align="left" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; font-style: normal; width: 50pt"></td>
<td align="right" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; padding-left: 0pt; text-align: left;  font-style: normal; width: 18pt">&nbsp;</td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; padding-bottom: 6pt; text-align: left; font-style: normal; width: 388pt">Exhibit
31.2</td>
<td style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top:6pt; padding-bottom: 6pt; text-align: left; font-style: normal; width: 388pt">Section 302 Certification by Chief Financial
Officer</td>
</tr>
</table>
<table cellpadding="0" cellspacing="0" border="0" width="602">
<tr>
<td><img src="spacer.gif" height="1" width="66"></td>
<td><img src="spacer.gif" height="1" width="24"></td>
<td><img src="spacer.gif" height="1" width="83"></td>
<td><img src="spacer.gif" height="1" width="429"></td>
</tr>
<tr>
<td align="left" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; font-style: normal; width: 50pt"></td>
<td align="right" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; padding-left: 0pt; text-align: left;  font-style: normal; width: 18pt">&nbsp;</td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; padding-bottom: 6pt; text-align: left; font-style: normal; width: 388pt">Exhibit
32</td>
<td style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top:6pt; padding-bottom: 6pt; text-align: left; font-style: normal; width: 388pt">Section 906 Certification by Chief Executive
Officer and Chief Financial Officer</td>
</tr>
</table>
<table cellpadding="0" cellspacing="0" border="0" width="602">
<tr>
<td><img src="spacer.gif" height="1" width="66"></td>
<td><img src="spacer.gif" height="1" width="24"></td>
<td><img src="spacer.gif" height="1" width="83"></td>
<td><img src="spacer.gif" height="1" width="429"></td>
</tr>
<tr>
<td align="left" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; font-style: normal; width: 50pt"></td>
<td align="right" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; padding-left: 0pt; text-align: left;  font-style: normal; width: 18pt">&nbsp;</td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; padding-bottom: 6pt; text-align: left; font-style: normal; width: 388pt">Exhibit
99.1</td>
<td style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top:6pt; padding-bottom: 6pt; text-align: left; font-style: normal; width: 388pt">Nominating Committee Charter and
Guidelines</td>
</tr>
</table>
<table cellpadding="0" cellspacing="0" border="0" width="602">
<tr>
<td><img src="spacer.gif" height="1" width="66"></td>
<td><img src="spacer.gif" height="1" width="24"></td>
<td><img src="spacer.gif" height="1" width="512"></td>
</tr>
<tr>
<td align="left" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; font-style: normal; width: 50pt"></td>
<td align="right" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; padding-left: 0pt; text-align: left;  font-style: normal; width: 18pt">b)&nbsp;</td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top:6pt; padding-bottom: 6pt; text-align: left; font-style: normal; width: 388pt">Reports on Form
8-K</td>
</tr>
</table>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top:6pt; padding-left:0pt; padding-right:0pt; padding-bottom: 6pt; margin: 0pt; text-indent: 20pt; background-color: #ffffff">On August 16, 2004, the Company filed with the Securities
and Exchange Commission a Current Report on Form 8-K, dated August 16,
2004, reporting the Company's financial results for the second
quarter and six months ended June 30, 2004 under Item
12.</p>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt; text-align: center; width: 456pt;">13</p>
<br>
<hr width="760" style="padding-left: 0pt;" align="left">
<br>






<page>
<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: center; font-style: normal; line-height: 12pt; padding-top: 12pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 0pt; background-color: #ffffff;">CPI
AEROSTRUCTURES, INC.</p>
<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: center; font-style: normal; line-height: 12pt; padding-top: 12pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 0pt; background-color: #ffffff;">
<u>SIGNATURES</u>
</p>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top:6pt; padding-left:0pt; padding-right:0pt; padding-bottom: 6pt; margin: 0pt; text-indent: 20pt; background-color: #ffffff">In accordance
with the requirements of the Exchange Act, the registrant has caused
this report to be signed on its behalf by the undersigned thereunto
duly authorized.</p>
<img src="spacer.gif" height="10" width="1"><br>
<div style="border: 1px; width: 602px; padding-top: 24px" align="center">
<table cellpadding="0" cellspacing="0" border="0" width="602" bgcolor="#ffffff">
<tr>
<!--col #: 1 / width: 296 / data-type: text-->
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="296"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="8"></td>
<!--col #: 2 / width: 296 / data-type: text--><td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="296"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
</tr>
<tr>
<td style="font-family: serif; font-size: 9pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 0pt; text-indent: 0pt;padding-top: 0pt" align="left" valign="top" colspan="3">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 9pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 0pt; text-indent: 0pt;padding-top: 0pt" align="left" valign="top" colspan="3">CPI
AEROSTRUCTURES, INC.</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 9pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 0pt; text-indent: 0pt;padding-top: 32pt" align="left" valign="top" colspan="3">Dated:
November 11, 2004</td>
<td style="padding-top: 32pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 9pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 0pt; text-indent: 0pt;padding-top: 32pt" align="left" valign="top" colspan="3">By:&nbsp;&nbsp;&nbsp;<u>/s/ Edward J.
Fred&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</u></td>
</tr>
<tr>
<td style="font-family: serif; font-size: 9pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 0pt; text-indent: 0pt;padding-top: 0pt" align="left" valign="top" colspan="3">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 9pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 0pt; text-indent: 0pt;padding-top: 0pt" align="left" valign="top" colspan="3">Edward
J. Fred<br>Chief Executive Officer and President<br> (and principal
executive officer)</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 9pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 0pt; text-indent: 0pt;padding-top: 32pt" align="left" valign="top" colspan="3">Dated:
November 11, 2004</td>
<td style="padding-top: 32pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 9pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 0pt; text-indent: 0pt;padding-top: 32pt" align="left" valign="top" colspan="3">By:&nbsp;&nbsp;&nbsp;<u>/s/ Vincent
Palazzolo&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</u></td>
</tr>
<tr>
<td style="font-family: serif; font-size: 9pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 0pt; text-indent: 0pt;padding-top: 0pt" align="left" valign="top" colspan="3">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 9pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 0pt; text-indent: 0pt;padding-top: 0pt" align="left" valign="top" colspan="3">Vincent
Palazzolo<br> Chief Financial Officer (and principal<br>accounting
officer)</td>
</tr>
<tr>
<td><img src="spacer.gif" height="10" width="1"></td>
</tr>
</table>
</div>
<br>
<hr width="760" style="padding-left: 0pt;" align="left">
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<DOCUMENT>
<TYPE>EX-31.1
<SEQUENCE>5
<FILENAME>file002.htm
<DESCRIPTION>SECTION 302 CERTIFICATION BY CHIEF EXEC. OFFICER
<TEXT>
<HTML><HEAD><TITLE></TITLE></HEAD><BODY>


<page>
<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: center; font-style: normal; line-height: 12pt; padding-top: 12pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 0pt; background-color: #ffffff;">CPI
AEROSTRUCTURES, INC.</p>
<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: right; font-style: normal; line-height: 12pt; padding-top: 6pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 0pt; background-color: #ffffff;">EXHIBIT 31.1</p>
<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: center; font-style: normal; line-height: 12pt; padding-top: 6pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 0pt; background-color: #ffffff;">SECTION 302 CERTIFICATION PURSUANT TO<br> RULE 13a-14 AND
15d-14 UNDER<br> THE SECURITIES ACT OF 1934, AS AMENDED</p>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top:6pt; padding-left:0pt; padding-right:0pt; padding-bottom: 0pt; margin: 0pt; text-indent: 0pt; background-color: #ffffff">I, Edward J. Fred, certify
that:</p>
<table cellpadding="0" cellspacing="0" border="0" width="602">
<tr>
<td><img src="spacer.gif" height="1" width="53"></td>
<td><img src="spacer.gif" height="1" width="549"></td>
</tr>
<tr>
<td align="right" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; padding-left: 20pt; text-align: left;  font-style: normal; width: 39.96pt">1.&nbsp;</td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top:6pt; padding-bottom: 6pt; text-align: left; font-style: normal; width: 416pt">I have reviewed this Quarterly
Report on Form 10-QSB of CPI Aerostructures,
Inc.;</td>
</tr>
</table>
<table cellpadding="0" cellspacing="0" border="0" width="602">
<tr>
<td><img src="spacer.gif" height="1" width="53"></td>
<td><img src="spacer.gif" height="1" width="549"></td>
</tr>
<tr>
<td align="right" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; padding-left: 20pt; text-align: left;  font-style: normal; width: 39.96pt">2.&nbsp;</td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top:6pt; padding-bottom: 6pt; text-align: left; font-style: normal; width: 416pt">Based on my knowledge, this
report does not contain any untrue statement of a material fact or omit
to state a material fact necessary to make the statements made, in
light of the circumstances under which such statements were made, not
misleading with respect to the period covered by this
report;</td>
</tr>
</table>
<table cellpadding="0" cellspacing="0" border="0" width="602">
<tr>
<td><img src="spacer.gif" height="1" width="53"></td>
<td><img src="spacer.gif" height="1" width="549"></td>
</tr>
<tr>
<td align="right" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; padding-left: 20pt; text-align: left;  font-style: normal; width: 39.96pt">3.&nbsp;</td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top:6pt; padding-bottom: 6pt; text-align: left; font-style: normal; width: 416pt">Based on my knowledge, the
financial statements, and other financial information included in this
report, fairly present in all material respects the financial
condition, results of operations and cash flows of the small business
issuer as of, and for, the periods presented in this
report;</td>
</tr>
</table>
<table cellpadding="0" cellspacing="0" border="0" width="602">
<tr>
<td><img src="spacer.gif" height="1" width="53"></td>
<td><img src="spacer.gif" height="1" width="549"></td>
</tr>
<tr>
<td align="right" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; padding-left: 20pt; text-align: left;  font-style: normal; width: 39.96pt">4.&nbsp;</td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top:6pt; padding-bottom: 6pt; text-align: left; font-style: normal; width: 416pt">The small business
issuer's other certifying officer(s) and I are responsible for
establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the small
business issuer and
have:</td>
</tr>
</table>
<table cellpadding="0" cellspacing="0" border="0" width="602">
<tr>
<td><img src="spacer.gif" height="1" width="53"></td>
<td><img src="spacer.gif" height="1" width="26"></td>
<td><img src="spacer.gif" height="1" width="523"></td>
</tr>
<tr>
<td align="left" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; font-style: normal; width: 40pt"></td>
<td align="right" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; padding-left: 0pt; text-align: left;  font-style: normal; width: 20.04pt">(a)&nbsp;</td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top:6pt; padding-bottom: 6pt; text-align: left; font-style: normal; width: 396pt">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 small business issuer, including
its consolidated subsidiaries, is made known to us by others within
those entities, particularly during the period in which this report is
being
prepared;</td>
</tr>
</table>
<table cellpadding="0" cellspacing="0" border="0" width="602">
<tr>
<td><img src="spacer.gif" height="1" width="53"></td>
<td><img src="spacer.gif" height="1" width="26"></td>
<td><img src="spacer.gif" height="1" width="523"></td>
</tr>
<tr>
<td align="left" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; font-style: normal; width: 40pt"></td>
<td align="right" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; padding-left: 0pt; text-align: left;  font-style: normal; width: 20.04pt">(b)&nbsp;</td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top:6pt; padding-bottom: 6pt; text-align: left; font-style: normal; width: 396pt">[intentionally
omitted];</td>
</tr>
</table>
<table cellpadding="0" cellspacing="0" border="0" width="602">
<tr>
<td><img src="spacer.gif" height="1" width="53"></td>
<td><img src="spacer.gif" height="1" width="26"></td>
<td><img src="spacer.gif" height="1" width="523"></td>
</tr>
<tr>
<td align="left" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; font-style: normal; width: 40pt"></td>
<td align="right" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; padding-left: 0pt; text-align: left;  font-style: normal; width: 20.04pt">(c)&nbsp;</td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top:6pt; padding-bottom: 6pt; text-align: left; font-style: normal; width: 396pt">Evaluated
the effectiveness of the small business issuer'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</td>
</tr>
</table>
<table cellpadding="0" cellspacing="0" border="0" width="602">
<tr>
<td><img src="spacer.gif" height="1" width="53"></td>
<td><img src="spacer.gif" height="1" width="26"></td>
<td><img src="spacer.gif" height="1" width="523"></td>
</tr>
<tr>
<td align="left" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; font-style: normal; width: 40pt"></td>
<td align="right" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; padding-left: 0pt; text-align: left;  font-style: normal; width: 20.04pt">(d)&nbsp;</td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top:6pt; padding-bottom: 6pt; text-align: left; font-style: normal; width: 396pt">Disclosed in this
report any change in the small business issuer's internal control
over financial reporting that occurred during the small business
issuer's most recent fiscal quarter that has materially affected,
or is reasonably likely to materially affect, the small business
issuer's internal control over financial reporting;
and</td>
</tr>
</table>
<table cellpadding="0" cellspacing="0" border="0" width="602">
<tr>
<td><img src="spacer.gif" height="1" width="53"></td>
<td><img src="spacer.gif" height="1" width="549"></td>
</tr>
<tr>
<td align="right" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; padding-left: 20pt; text-align: left;  font-style: normal; width: 39.96pt">5.&nbsp;</td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top:6pt; padding-bottom: 6pt; text-align: left; font-style: normal; width: 416pt">The small business
issuer's other certifying officer(s) and I have disclosed, based
on our most recent evaluation of internal control over financial
reporting, to the small business issuer's auditors and to the
audit committee of the small business issuer's board of directors
(or persons performing the equivalent
functions):</td>
</tr>
</table>
<table cellpadding="0" cellspacing="0" border="0" width="602">
<tr>
<td><img src="spacer.gif" height="1" width="53"></td>
<td><img src="spacer.gif" height="1" width="26"></td>
<td><img src="spacer.gif" height="1" width="523"></td>
</tr>
<tr>
<td align="left" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; font-style: normal; width: 40pt"></td>
<td align="right" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; padding-left: 0pt; text-align: left;  font-style: normal; width: 20.04pt">(a)&nbsp;</td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top:6pt; padding-bottom: 6pt; text-align: left; font-style: normal; width: 396pt">All
significant deficiencies and material weaknesses in the design or
operation of internal control over financial reporting which are
reasonably likely to adversely affect the small business issuer's
ability to record, process, summarize and report financial information;
and</td>
</tr>
</table>
<table cellpadding="0" cellspacing="0" border="0" width="602">
<tr>
<td><img src="spacer.gif" height="1" width="53"></td>
<td><img src="spacer.gif" height="1" width="26"></td>
<td><img src="spacer.gif" height="1" width="523"></td>
</tr>
<tr>
<td align="left" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; font-style: normal; width: 40pt"></td>
<td align="right" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; padding-left: 0pt; text-align: left;  font-style: normal; width: 20.04pt">(b)&nbsp;</td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top:6pt; padding-bottom: 6pt; text-align: left; font-style: normal; width: 396pt">Any fraud, whether
or not material, that involves management or other employees who have a
significant role in the small business issuer's internal control
over financial reporting.</td>
</tr>
</table>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top:6pt; padding-left:0pt; padding-right:0pt; padding-bottom: 6pt; margin: 0pt; text-indent: 20pt; background-color: #ffffff">Date: November 11, 2004</p>
<img src="spacer.gif" height="10" width="1"><br>
<div style="border: 1px; width: 602px; padding-top: 0px" align="right">
<table cellpadding="0" cellspacing="0" border="0" width="285" bgcolor="#ffffff">
<tr>
<!--col #: 1 / width: 22 / data-type: text-->
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="22"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="8"></td>
<!--col #: 2 / width: 285 / data-type: text--><td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="285"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
</tr>
<tr>
<td style="font-family: serif; font-size: 9pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 0pt; text-indent: 0pt;padding-top: 0pt" align="left" valign="top" colspan="3">By:</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 9pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-left: 0pt; text-indent: 0pt;padding-top: 0pt" align="left" valign="top" colspan="3">/s/
Edward J. Fred</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 9pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 0pt; text-indent: 0pt;padding-top: 0pt" align="left" valign="top" colspan="3">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 9pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 0pt; text-indent: 0pt;padding-top: 0pt" align="left" valign="top" colspan="3">Name: Edward J.
Fred</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 9pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 0pt; text-indent: 0pt;padding-top: 0pt" align="left" valign="top" colspan="3">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 9pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 40pt; text-indent: -10pt;padding-top: 0pt" align="left" valign="top" colspan="3">Title: Chief Executive Officer and
President<br>(and principal executive
officer)</td>
</tr>
<tr>
<td><img src="spacer.gif" height="10" width="1"></td>
</tr>
</table>
</div>
<br>
<hr width="760" style="padding-left: 0pt;" align="left">
<br>



</BODY></HTML>

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-31.2
<SEQUENCE>6
<FILENAME>file003.htm
<DESCRIPTION>SECTION 302 CERTIFICATION BY CHIEF FIN. OFFICER
<TEXT>
<HTML><HEAD><TITLE></TITLE></HEAD><BODY>


<page>
<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: center; font-style: normal; line-height: 12pt; padding-top: 12pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 0pt; background-color: #ffffff;">CPI
AEROSTRUCTURES, INC.</p>
<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: right; font-style: normal; line-height: 12pt; padding-top: 12pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 0pt; background-color: #ffffff;">EXHIBIT 31.2</p>
<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: center; font-style: normal; line-height: 12pt; padding-top: 12pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 0pt; background-color: #ffffff;">SECTION 302
CERTIFICATION PURSUANT TO<br>RULE 13a-14 AND 15d-14 UNDER<br>THE
SECURITIES ACT OF 1934, AS AMENDED</p>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top:6pt; padding-left:0pt; padding-right:0pt; padding-bottom: 0pt; margin: 0pt; text-indent: 0pt; background-color: #ffffff">I,
Vincent Palazzolo, certify that:</p>
<table cellpadding="0" cellspacing="0" border="0" width="602">
<tr>
<td><img src="spacer.gif" height="1" width="24"></td>
<td><img src="spacer.gif" height="1" width="578"></td>
</tr>
<tr>
<td align="right" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; padding-left: 0pt; text-align: left;  font-style: normal; width: 18pt">1.&nbsp;</td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top:6pt; padding-bottom: 6pt; text-align: left; font-style: normal; width: 438pt">I
have reviewed this Quarterly Report on Form 10-QSB of CPI
Aerostructures, Inc.;</td>
</tr>
</table>
<table cellpadding="0" cellspacing="0" border="0" width="602">
<tr>
<td><img src="spacer.gif" height="1" width="24"></td>
<td><img src="spacer.gif" height="1" width="578"></td>
</tr>
<tr>
<td align="right" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; padding-left: 0pt; text-align: left;  font-style: normal; width: 18pt">2.&nbsp;</td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top:6pt; padding-bottom: 6pt; text-align: left; font-style: normal; width: 438pt">Based on my
knowledge, this report does not contain any untrue statement of a
material fact or omit to state a material fact necessary to make the
statements made, in light of the circumstances under which such
statements were made, not misleading with respect to the period covered
by this report;</td>
</tr>
</table>
<table cellpadding="0" cellspacing="0" border="0" width="602">
<tr>
<td><img src="spacer.gif" height="1" width="24"></td>
<td><img src="spacer.gif" height="1" width="578"></td>
</tr>
<tr>
<td align="right" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; padding-left: 0pt; text-align: left;  font-style: normal; width: 18pt">3.&nbsp;</td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top:6pt; padding-bottom: 6pt; text-align: left; font-style: normal; width: 438pt">Based on my
knowledge, the financial statements, and other financial information
included in this report, fairly present in all material respects the
financial condition, results of operations and cash flows of the small
business issuer as of, and for, the periods presented in this
report;</td>
</tr>
</table>
<table cellpadding="0" cellspacing="0" border="0" width="602">
<tr>
<td><img src="spacer.gif" height="1" width="24"></td>
<td><img src="spacer.gif" height="1" width="578"></td>
</tr>
<tr>
<td align="right" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; padding-left: 0pt; text-align: left;  font-style: normal; width: 18pt">4.&nbsp;</td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top:6pt; padding-bottom: 6pt; text-align: left; font-style: normal; width: 438pt">The small business
issuer's other certifying officer(s) and I are responsible for
establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the small
business issuer and
have:</td>
</tr>
</table>
<table cellpadding="0" cellspacing="0" border="0" width="602">
<tr>
<td><img src="spacer.gif" height="1" width="53"></td>
<td><img src="spacer.gif" height="1" width="549"></td>
</tr>
<tr>
<td align="right" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; padding-left: 18pt; text-align: left;  font-style: normal; width: 39.96pt">(a)&nbsp;</td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top:6pt; padding-bottom: 6pt; text-align: left; font-style: normal; width: 416pt">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 small business issuer, including
its consolidated subsidiaries, is made known to us by others within
those entities, particularly during the period in which this report is
being
prepared;</td>
</tr>
</table>
<table cellpadding="0" cellspacing="0" border="0" width="602">
<tr>
<td><img src="spacer.gif" height="1" width="53"></td>
<td><img src="spacer.gif" height="1" width="549"></td>
</tr>
<tr>
<td align="right" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; padding-left: 18pt; text-align: left;  font-style: normal; width: 39.96pt">(b)&nbsp;</td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top:6pt; padding-bottom: 6pt; text-align: left; font-style: normal; width: 416pt">[intentionally
omitted];</td>
</tr>
</table>
<table cellpadding="0" cellspacing="0" border="0" width="602">
<tr>
<td><img src="spacer.gif" height="1" width="53"></td>
<td><img src="spacer.gif" height="1" width="549"></td>
</tr>
<tr>
<td align="right" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; padding-left: 18pt; text-align: left;  font-style: normal; width: 39.96pt">(c)&nbsp;</td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top:6pt; padding-bottom: 6pt; text-align: left; font-style: normal; width: 416pt">Evaluated the
effectiveness of the small business issuer'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</td>
</tr>
</table>
<table cellpadding="0" cellspacing="0" border="0" width="602">
<tr>
<td><img src="spacer.gif" height="1" width="53"></td>
<td><img src="spacer.gif" height="1" width="549"></td>
</tr>
<tr>
<td align="right" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; padding-left: 18pt; text-align: left;  font-style: normal; width: 39.96pt">(d)&nbsp;</td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top:6pt; padding-bottom: 6pt; text-align: left; font-style: normal; width: 416pt">Disclosed in this report
any change in the small business issuer's internal control over
financial reporting that occurred during the small business
issuer's most recent fiscal quarter that has materially affected,
or is reasonably likely to materially affect, the small business
issuer's internal control over financial reporting;
and</td>
</tr>
</table>
<table cellpadding="0" cellspacing="0" border="0" width="602">
<tr>
<td><img src="spacer.gif" height="1" width="24"></td>
<td><img src="spacer.gif" height="1" width="578"></td>
</tr>
<tr>
<td align="right" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; padding-left: 0pt; text-align: left;  font-style: normal; width: 18pt">5.&nbsp;</td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top:6pt; padding-bottom: 6pt; text-align: left; font-style: normal; width: 438pt">The small business
issuer's other certifying officer(s) and I have disclosed, based
on our most recent evaluation of internal control over financial
reporting, to the small business issuer's auditors and to the
audit committee of the small business issuer's board of directors
(or persons performing the equivalent
functions):</td>
</tr>
</table>
<table cellpadding="0" cellspacing="0" border="0" width="602">
<tr>
<td><img src="spacer.gif" height="1" width="53"></td>
<td><img src="spacer.gif" height="1" width="549"></td>
</tr>
<tr>
<td align="right" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; padding-left: 18pt; text-align: left;  font-style: normal; width: 39.96pt">(a)&nbsp;</td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top:6pt; padding-bottom: 6pt; text-align: left; font-style: normal; width: 416pt">All significant
deficiencies and material weaknesses in the design or operation of
internal control over financial reporting which are reasonably likely
to adversely affect the small business issuer's ability to
record, process, summarize and report financial information;
and</td>
</tr>
</table>
<table cellpadding="0" cellspacing="0" border="0" width="602">
<tr>
<td><img src="spacer.gif" height="1" width="53"></td>
<td><img src="spacer.gif" height="1" width="549"></td>
</tr>
<tr>
<td align="right" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; padding-left: 18pt; text-align: left;  font-style: normal; width: 39.96pt">(b)&nbsp;</td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top:6pt; padding-bottom: 6pt; text-align: left; font-style: normal; width: 416pt">Any fraud, whether or not
material, that involves management or other employees who have a
significant role in the small business issuer's internal control
over financial reporting.</td>
</tr>
</table>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top:6pt; padding-left:0pt; padding-right:0pt; padding-bottom: 0pt; margin: 0pt; text-indent: 0pt; background-color: #ffffff">Date: November 11, 2004</p>
<table cellpadding="0" cellspacing="0" border="0" width="602">
<tr>
<td><img src="spacer.gif" height="1" width="301"></td>
<td><img src="spacer.gif" height="1" width="32"></td>
<td><img src="spacer.gif" height="1" width="269"></td>
</tr>
<tr>
<td align="left" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; font-style: normal; width: 228pt"></td>
<td align="right" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; padding-left: -228pt; text-align: left;  font-style: normal; width: 24pt">By: &nbsp;</td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top:6pt; padding-bottom: 6pt; text-align: left; font-style: normal; width: 204pt"><u>/s/ Vincent
Palazzolo&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</u>
<br> Name:
Vincent Palazzolo<br> Title: Chief Financial Officer<br> (and
principal accounting officer)</td>
</tr>
</table>
<br>
<hr width="760" style="padding-left: 0pt;" align="left">
<br>



</BODY></HTML>

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-32
<SEQUENCE>7
<FILENAME>file004.htm
<DESCRIPTION>SECTION 906 CERTIFICATION BY CEO AND CFO
<TEXT>
<HTML><HEAD><TITLE></TITLE></HEAD><BODY>


<page>
<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: center; font-style: normal; line-height: 12pt; padding-top: 12pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 0pt; background-color: #ffffff;">CPI
AEROSTRUCTURES, INC.</p>
<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: right; font-style: normal; line-height: 12pt; padding-top: 12pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 0pt; background-color: #ffffff;">EXHIBIT 32</p>
<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: center; font-style: normal; line-height: 12pt; padding-top: 12pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 0pt; background-color: #ffffff;">CERTIFICATION
PURSUANT TO<br> 18 U.S.C. SECTION 1350<br> AS ADOPTED PURSUANT
TO<br> SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002</p>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top:6pt; padding-left:0pt; padding-right:0pt; padding-bottom: 0pt; margin: 0pt; text-indent: 20pt; background-color: #ffffff">In
connection with the Quarterly Report of CPI Aerostructures, Inc. (the
"Company") on Form 10-QSB for the period
ended September 30, 2004 as filed with the Securities and Exchange
Commission (the "Report"), the undersigned,
in the capacities and on the date indicated below, hereby certifies
pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906
of the Sarbanes-Oxley Act of 2002, that:</p>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top:6pt; padding-left:0pt; padding-right:0pt; padding-bottom: 0pt; margin: 0pt; text-indent: 20pt; background-color: #ffffff">1.&nbsp;&nbsp;&nbsp;&nbsp;the Report
fully complies with the requirements of Section 13(a) or 15(d) of the
Securities Exchange Act of 1934; and</p>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top:6pt; padding-left:0pt; padding-right:0pt; padding-bottom: 6pt; margin: 0pt; text-indent: 20pt; background-color: #ffffff">2.&nbsp;&nbsp;&nbsp;&nbsp;the information
contained in the Report fairly presents, in all material respects, the
financial condition and results of operation of the Company.</p>
<img src="spacer.gif" height="10" width="1"><br>
<div style="border: 1px; width: 602px; padding-top: 24px" align="center">
<table cellpadding="0" cellspacing="0" border="0" width="602" bgcolor="#ffffff">
<tr>
<!--col #: 1 / width: 317 / data-type: text-->
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="317"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="8"></td>
<!--col #: 2 / width: 269 / data-type: text--><td><img src="spacer.gif" height="1" width="1"></td>
<td><img src="spacer.gif" height="1" width="269"></td>
<td><img src="spacer.gif" height="1" width="1"></td>
</tr>
<tr>
<td style="font-family: serif; font-size: 9pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 0pt; text-indent: 0pt;padding-top: 32pt" align="left" valign="top" colspan="3">Dated: November 11,
2004</td>
<td style="padding-top: 32pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 9pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-left: 0pt; text-indent: 0pt;padding-top: 32pt" align="left" valign="top" colspan="3">/s/ Edward J. Fred</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 9pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 0pt; text-indent: 0pt;padding-top: 0pt" align="left" valign="top" colspan="3">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 9pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 0pt; text-indent: 0pt;padding-top: 0pt" align="left" valign="top" colspan="3">Edward J. Fred<br> Chief Executive Office and
President<br> (and principal executive officer)</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 9pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 0pt; text-indent: 0pt;padding-top: 16pt" align="left" valign="top" colspan="3">Dated: November 11,
2004</td>
<td style="padding-top: 16pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 9pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 1px solid #000000 ;padding-left: 0pt; text-indent: 0pt;padding-top: 16pt" align="left" valign="top" colspan="3">/s/ Vincent
Palazzolo</td>
</tr>
<tr>
<td style="font-family: serif; font-size: 9pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 0pt; text-indent: 0pt;padding-top: 0pt" align="left" valign="top" colspan="3">&nbsp;</td>
<td style="padding-top: 0pt "><img src="spacer.gif" height="1" width="2"></td>
<td style="font-family: serif; font-size: 9pt; color: #000000; font-weight: normal; font-style: normal; border-bottom: 3px double #ffffff;padding-left: 0pt; text-indent: 0pt;padding-top: 0pt" align="left" valign="top" colspan="3">Vincent Palazzolo<br> Chief
Financial Officer (and principal accounting
officer)</td>
</tr>
<tr>
<td><img src="spacer.gif" height="10" width="1"></td>
</tr>
</table>
</div>
<br>
<hr width="760" style="padding-left: 0pt;" align="left">
<br>



</BODY></HTML>

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.1
<SEQUENCE>8
<FILENAME>file005.htm
<DESCRIPTION>NOMINATING COMMITTEE CHARTER AND GUIDELINES
<TEXT>
<HTML><HEAD><TITLE></TITLE></HEAD><BODY>


<page>
<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: center; font-style: normal; line-height: 12pt; padding-top: 12pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 0pt; background-color: #ffffff;">CPI
AEROSTRUCTURES, INC.</p>
<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: right; font-style: normal; line-height: 12pt; padding-top: 6pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 0pt; background-color: #ffffff;">EXHIBIT
99.1</p>
<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: right; font-style: normal; line-height: 12pt; padding-top: 12pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 0pt; background-color: #ffffff;">Adopted by the Nominating Committee<br>June 16,
2004<br>Approved by the Board of Directors<br> June 16, 2004</p>
<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: center; font-style: normal; line-height: 12pt; padding-top: 12pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 0pt; background-color: #ffffff;">CPI AEROSTRUCTURES, INC.</p>
<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: center; font-style: normal; line-height: 12pt; padding-top: 6pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 0pt; background-color: #ffffff;">Nominating Committee
Charter</p>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top:6pt; padding-left:0pt; padding-right:0pt; padding-bottom: 0pt; margin: 0pt; text-indent: 20pt; background-color: #ffffff">The Nominating Committee's responsibilities and
powers as delegated by the board of directors are set forth in this
charter. Whenever the Committee takes an action, it shall exercise its
independent judgment on an informed basis that the action is in the
best interests of the Company and its shareholders.</p>
<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top: 12pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 0pt; background-color: #ffffff;">I.&nbsp;&nbsp;&nbsp;&nbsp;PURPOSE</p>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top:6pt; padding-left:0pt; padding-right:0pt; padding-bottom: 0pt; margin: 0pt; text-indent: 20pt; background-color: #ffffff">As set forth herein, the Committee shall,
among other things, discharge the responsibilities of the board of
directors relating to the appropriate size, functioning and needs of
the board including, but not limited to, recruitment and retention of
high quality board members and committee composition and structure.</p>
<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top: 12pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 0pt; background-color: #ffffff;">II.&nbsp;&nbsp;&nbsp;&nbsp;MEMBERSHIP</p>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top:6pt; padding-left:0pt; padding-right:0pt; padding-bottom: 0pt; margin: 0pt; text-indent: 20pt; background-color: #ffffff">The Committee shall consist of at least
three members of the board of directors as determined from time to time
by the board. Each member shall be
"independent" in accordance with the listing
standards of the American Stock Exchange, as amended from time to
time.</p>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top:6pt; padding-left:0pt; padding-right:0pt; padding-bottom: 0pt; margin: 0pt; text-indent: 20pt; background-color: #ffffff">The board of directors shall elect the members of this
Committee at the first board meeting practicable following the annual
meeting of shareholders and may make changes from time to time pursuant
to the provisions below. Unless a chair is elected by the board of
directors, the members of the Committee shall designate a chair by
majority vote of the full Committee membership.</p>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top:6pt; padding-left:0pt; padding-right:0pt; padding-bottom: 0pt; margin: 0pt; text-indent: 20pt; background-color: #ffffff">A Committee
member may resign by delivering his or her written resignation to the
chairman of the board of directors, or may be removed by majority vote
of the board of directors by delivery to such member of written notice
of removal, to take effect at a date specified therein, or upon
delivery of such written notice to such member if no date is
specified.</p>
<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top: 12pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 0pt; background-color: #ffffff;">III.&nbsp;&nbsp;&nbsp;&nbsp;MEETINGS AND COMMITTEE ACTION</p>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top:6pt; padding-left:0pt; padding-right:0pt; padding-bottom: 0pt; margin: 0pt; text-indent: 20pt; background-color: #ffffff">The
Committee shall meet at such times as it deems necessary to fulfill its
responsibilities. Meetings of the Committee shall be called by the
chairman of the Committee upon such notice as is provided for in the
by-laws of the company with respect to meetings of the board of
directors. A majority of the members shall constitute a quorum. Actions
of the Committee may be taken in person at a meeting or in writing
without a meeting. Actions taken at a meeting, to be valid, shall
require the approval of a majority of the members present and voting.
Actions taken in writing, to be valid, shall be signed by all members
of the Committee. The Committee shall report its minutes from each
meeting to the board of directors.</p>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top:6pt; padding-left:0pt; padding-right:0pt; padding-bottom: 6pt; margin: 0pt; text-indent: 20pt; background-color: #ffffff">The chairman of the Committee
shall establish such rules as may from time to time be necessary or
appropriate for the conduct of the business of the Committee. At each
meeting, the chairman shall appoint as secretary a person who may, but
need not, be a member of the Committee. A certificate of the secretary
of the Committee or minutes of a meeting of the Committee executed by
the secretary setting forth the names of the members of the Committee
present at the meeting or actions taken by the Committee at the meeting
shall be sufficient evidence at all times as to the members of the
Committee who were present, or such actions taken.</p>
<br>
<hr width="760" style="padding-left: 0pt;" align="left">
<br>
<page>
<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: center; font-style: normal; line-height: 12pt; padding-top: 12pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 0pt; background-color: #ffffff;">CPI AEROSTRUCTURES, INC.</p>
<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top: 12pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 0pt; background-color: #ffffff;">IV.&nbsp;&nbsp;&nbsp;&nbsp;COMMITTEE AUTHORITY AND
RESPONSIBILITIES</p>
<table cellpadding="0" cellspacing="0" border="0" width="602">
<tr>
<td><img src="spacer.gif" height="1" width="48"></td>
<td><img src="spacer.gif" height="1" width="554"></td>
</tr>
<tr>
<td align="right" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; padding-left: 18pt; text-align: left;  font-style: normal; width: 36pt">&bull;&nbsp;</td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top:6pt; padding-bottom: 6pt; text-align: left; font-style: normal; width: 420pt">Developing
the criteria and qualifications for membership on the
board.</td>
</tr>
</table>
<table cellpadding="0" cellspacing="0" border="0" width="602">
<tr>
<td><img src="spacer.gif" height="1" width="24"></td>
<td><img src="spacer.gif" height="1" width="578"></td>
</tr>
<tr>
<td align="right" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; padding-left: 0pt; text-align: left;  font-style: normal; width: 18pt">&bull;&nbsp;</td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top:6pt; padding-bottom: 6pt; text-align: left; font-style: normal; width: 438pt">Recruiting, reviewing
and recommending to the board of directors candidates for election to
the board of directors or to fill vacancies on the board of
directors.</td>
</tr>
</table>
<table cellpadding="0" cellspacing="0" border="0" width="602">
<tr>
<td><img src="spacer.gif" height="1" width="24"></td>
<td><img src="spacer.gif" height="1" width="578"></td>
</tr>
<tr>
<td align="right" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; padding-left: 0pt; text-align: left;  font-style: normal; width: 18pt">&bull;&nbsp;</td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top:6pt; padding-bottom: 6pt; text-align: left; font-style: normal; width: 438pt">Reviewing candidates
proposed by stockholders, and conducting appropriate inquiries into the
background and qualifications of any such
candidates.</td>
</tr>
</table>
<table cellpadding="0" cellspacing="0" border="0" width="602">
<tr>
<td><img src="spacer.gif" height="1" width="24"></td>
<td><img src="spacer.gif" height="1" width="578"></td>
</tr>
<tr>
<td align="right" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; padding-left: 0pt; text-align: left;  font-style: normal; width: 18pt">&bull;&nbsp;</td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top:6pt; padding-bottom: 6pt; text-align: left; font-style: normal; width: 438pt">Establishing
subcommittees for the purpose of evaluating special or unique
matters.</td>
</tr>
</table>
<table cellpadding="0" cellspacing="0" border="0" width="602">
<tr>
<td><img src="spacer.gif" height="1" width="48"></td>
<td><img src="spacer.gif" height="1" width="554"></td>
</tr>
<tr>
<td align="right" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; padding-left: 18pt; text-align: left;  font-style: normal; width: 36pt">&bull;&nbsp;</td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top:6pt; padding-bottom: 6pt; text-align: left; font-style: normal; width: 420pt">Monitoring and making
recommendations regarding committee functions, contributions and
composition.</td>
</tr>
</table>
<table cellpadding="0" cellspacing="0" border="0" width="602">
<tr>
<td><img src="spacer.gif" height="1" width="48"></td>
<td><img src="spacer.gif" height="1" width="554"></td>
</tr>
<tr>
<td align="right" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; padding-left: 18pt; text-align: left;  font-style: normal; width: 36pt">&bull;&nbsp;</td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top:6pt; padding-bottom: 6pt; text-align: left; font-style: normal; width: 420pt">Evaluating, on an
annual basis, the Committee's performance.</td>
</tr>
</table>
<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top: 12pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 0pt; background-color: #ffffff;">VI.
&nbsp;&nbsp;&nbsp;&nbsp;REPORTING</p>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top:6pt; padding-left:0pt; padding-right:0pt; padding-bottom: 6pt; margin: 0pt; text-indent: 20pt; background-color: #ffffff">The Committee shall prepare a statement each
year concerning its compliance with this charter for inclusion in the
Company's proxy statement.</p>
<br>
<hr width="760" style="padding-left: 0pt;" align="left">
<br>
<page>
<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: center; font-style: normal; line-height: 12pt; padding-top: 12pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 0pt; background-color: #ffffff;">CPI AEROSTRUCTURES, INC.</p>
<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: center; font-style: normal; line-height: 12pt; padding-top: 12pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 0pt; background-color: #ffffff;">Board of
Director Candidate Guidelines</p>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top:6pt; padding-left:0pt; padding-right:0pt; padding-bottom: 0pt; margin: 0pt; text-indent: 20pt; background-color: #ffffff">The Nominating Committee of CPI
Aerostructures, Inc. (the "Company") will
identify, evaluate and recommend candidates to become members of the
Board of Directors ("Board") with the goal of
creating a balance of knowledge and experience. Nominations to the
Board may also be submitted to the Nominating Committee by the
Company's shareholders in accordance with the Company's
policy, a copy of which is attached hereto. Candidates will be reviewed
in the context of current composition of the Board, the operating
requirements of the Company and the long-term interests of the
Company's shareholders. In conducting this assessment, the
Committee will consider and evaluate each director-candidate based upon
its assessment of the following
criteria:</p>
<table cellpadding="0" cellspacing="0" border="0" width="602">
<tr>
<td><img src="spacer.gif" height="1" width="48"></td>
<td><img src="spacer.gif" height="1" width="554"></td>
</tr>
<tr>
<td align="right" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; padding-left: 20pt; text-align: left;  font-style: normal; width: 36pt">&bull;&nbsp;</td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top:6pt; padding-bottom: 6pt; text-align: left; font-style: normal; width: 420pt">Whether the candidate is
independent pursuant to the requirements of the American Stock
Exchange.</td>
</tr>
</table>
<table cellpadding="0" cellspacing="0" border="0" width="602">
<tr>
<td><img src="spacer.gif" height="1" width="48"></td>
<td><img src="spacer.gif" height="1" width="554"></td>
</tr>
<tr>
<td align="right" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; padding-left: 20pt; text-align: left;  font-style: normal; width: 36pt">&bull;&nbsp;</td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top:6pt; padding-bottom: 6pt; text-align: left; font-style: normal; width: 420pt">Whether the candidate is
accomplished in his or her field and has a reputation, both personal
and professional, that is consistent with the image and reputation of
the Company.</td>
</tr>
</table>
<table cellpadding="0" cellspacing="0" border="0" width="602">
<tr>
<td><img src="spacer.gif" height="1" width="48"></td>
<td><img src="spacer.gif" height="1" width="554"></td>
</tr>
<tr>
<td align="right" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; padding-left: 20pt; text-align: left;  font-style: normal; width: 36pt">&bull;&nbsp;</td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top:6pt; padding-bottom: 6pt; text-align: left; font-style: normal; width: 420pt">Whether the candidate has
the ability to read and understand basic financial statements. The
Nominating Committee also will determine if a candidate satisfies the
criteria for being an "audit committee financial
expert," as defined by the Securities and Exchange
Commission.</td>
</tr>
</table>
<table cellpadding="0" cellspacing="0" border="0" width="602">
<tr>
<td><img src="spacer.gif" height="1" width="48"></td>
<td><img src="spacer.gif" height="1" width="554"></td>
</tr>
<tr>
<td align="right" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; padding-left: 20pt; text-align: left;  font-style: normal; width: 36pt">&bull;&nbsp;</td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top:6pt; padding-bottom: 6pt; text-align: left; font-style: normal; width: 420pt">Whether the candidate has
relevant experience and expertise and would be able to provide insights
and practical wisdom based upon that experience and
expertise.</td>
</tr>
</table>
<table cellpadding="0" cellspacing="0" border="0" width="602">
<tr>
<td><img src="spacer.gif" height="1" width="48"></td>
<td><img src="spacer.gif" height="1" width="554"></td>
</tr>
<tr>
<td align="right" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; padding-left: 20pt; text-align: left;  font-style: normal; width: 36pt">&bull;&nbsp;</td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top:6pt; padding-bottom: 6pt; text-align: left; font-style: normal; width: 420pt">Whether the candidate has
knowledge of the Company and issues affecting the
Company.</td>
</tr>
</table>
<table cellpadding="0" cellspacing="0" border="0" width="602">
<tr>
<td><img src="spacer.gif" height="1" width="48"></td>
<td><img src="spacer.gif" height="1" width="554"></td>
</tr>
<tr>
<td align="right" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; padding-left: 20pt; text-align: left;  font-style: normal; width: 36pt">&bull;&nbsp;</td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top:6pt; padding-bottom: 6pt; text-align: left; font-style: normal; width: 420pt">Whether the candidate is
committed to enhancing shareholder
value.</td>
</tr>
</table>
<table cellpadding="0" cellspacing="0" border="0" width="602">
<tr>
<td><img src="spacer.gif" height="1" width="48"></td>
<td><img src="spacer.gif" height="1" width="554"></td>
</tr>
<tr>
<td align="right" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; padding-left: 20pt; text-align: left;  font-style: normal; width: 36pt">&bull;&nbsp;</td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top:6pt; padding-bottom: 6pt; text-align: left; font-style: normal; width: 420pt">Whether the candidate fully
understands, or has the capacity to fully understand, the legal
responsibilities of a director and the governance processes of a public
company.</td>
</tr>
</table>
<table cellpadding="0" cellspacing="0" border="0" width="602">
<tr>
<td><img src="spacer.gif" height="1" width="48"></td>
<td><img src="spacer.gif" height="1" width="554"></td>
</tr>
<tr>
<td align="right" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; padding-left: 20pt; text-align: left;  font-style: normal; width: 36pt">&bull;&nbsp;</td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top:6pt; padding-bottom: 6pt; text-align: left; font-style: normal; width: 420pt">Whether the candidate is of
high moral and ethical character and would be willing to apply sound,
objective and independent business judgment, and to assume broad
fiduciary responsibility.</td>
</tr>
</table>
<table cellpadding="0" cellspacing="0" border="0" width="602">
<tr>
<td><img src="spacer.gif" height="1" width="48"></td>
<td><img src="spacer.gif" height="1" width="554"></td>
</tr>
<tr>
<td align="right" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; padding-left: 20pt; text-align: left;  font-style: normal; width: 36pt">&bull;&nbsp;</td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top:6pt; padding-bottom: 6pt; text-align: left; font-style: normal; width: 420pt">Whether the
candidate has, and would be willing to commit, the required hours
necessary to discharge the duties of Board
membership.</td>
</tr>
</table>
<table cellpadding="0" cellspacing="0" border="0" width="602">
<tr>
<td><img src="spacer.gif" height="1" width="48"></td>
<td><img src="spacer.gif" height="1" width="554"></td>
</tr>
<tr>
<td align="right" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; padding-left: 20pt; text-align: left;  font-style: normal; width: 36pt">&bull;&nbsp;</td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top:6pt; padding-bottom: 6pt; text-align: left; font-style: normal; width: 420pt">Whether the candidate has
any prohibitive interlocking relationships or conflicts of
interest.</td>
</tr>
</table>
<table cellpadding="0" cellspacing="0" border="0" width="602">
<tr>
<td><img src="spacer.gif" height="1" width="48"></td>
<td><img src="spacer.gif" height="1" width="554"></td>
</tr>
<tr>
<td align="right" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; padding-left: 20pt; text-align: left;  font-style: normal; width: 36pt">&bull;&nbsp;</td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top:6pt; padding-bottom: 6pt; text-align: left; font-style: normal; width: 420pt">Whether the candidate is able
to develop a good working relationship with other Board members and
contribute to the Board's working relationship with the senior
management of the Company.</td>
</tr>
</table>
<table cellpadding="0" cellspacing="0" border="0" width="602">
<tr>
<td><img src="spacer.gif" height="1" width="48"></td>
<td><img src="spacer.gif" height="1" width="554"></td>
</tr>
<tr>
<td align="right" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; padding-left: 20pt; text-align: left;  font-style: normal; width: 36pt">&bull;&nbsp;</td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top:6pt; padding-bottom: 6pt; text-align: left; font-style: normal; width: 420pt">Whether the
candidate is able to suggest business opportunities to the
Company.</td>
</tr>
</table>
<br>
<hr width="760" style="padding-left: 0pt;" align="left">
<br>
<page>
<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: center; font-style: normal; line-height: 12pt; padding-top: 12pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 0pt; background-color: #ffffff;">CPI AEROSTRUCTURES, INC.</p>
<p style="font-family:serif;font-weight:bold;color:#000000;font-size:10pt;  width: 456pt; text-align: center; font-style: normal; line-height: 12pt; padding-top: 12pt; padding-left:0pt; padding-right:0pt; margin: 0pt; text-indent: 0pt; padding-bottom: 0pt; background-color: #ffffff;">Shareholder Recommendations for Directors</p>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top:6pt; padding-left:0pt; padding-right:0pt; padding-bottom: 0pt; margin: 0pt; text-indent: 20pt; background-color: #ffffff">Shareholders who
wish to recommend to the Nominating Committee a candidate for election
to the Board of Directors should send their letters to CPI
Aerostructures, Inc. 200A Executive Drive, Edgewood, New York 11717,
Attention: Nominating Committee. The Corporate Secretary will promptly
forward all such letters to the members of the Nominating Committee.
Shareholders must follow certain procedures to recommend to the
Nominating Committee candidates for election as directors. In general,
in order to provide sufficient time to enable the Nominating Committee
to evaluate candidates recommended by shareholders in connection with
selecting candidates for nomination in connection with the
Company's annual meeting of shareholders, the Corporate Secretary
must receive the shareholder's recommendation no later than
thirty (30) days after the end of the Company's fiscal year.</p>
<p style="font-family:serif;font-weight:normal;color:#000000;font-size:10pt;  width: 456pt; text-align: left; font-style: normal; line-height: 12pt; padding-top:6pt; padding-left:0pt; padding-right:0pt; padding-bottom: 0pt; margin: 0pt; text-indent: 20pt; background-color: #ffffff">The recommendation must contain the following information about the
candidate:</p>
<table cellpadding="0" cellspacing="0" border="0" width="602">
<tr>
<td><img src="spacer.gif" height="1" width="48"></td>
<td><img src="spacer.gif" height="1" width="554"></td>
</tr>
<tr>
<td align="right" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; padding-left: 20pt; text-align: left;  font-style: normal; width: 36pt">&bull;&nbsp;</td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top:6pt; padding-bottom: 6pt; text-align: left; font-style: normal; width: 420pt">Name;</td>
</tr>
</table>
<table cellpadding="0" cellspacing="0" border="0" width="602">
<tr>
<td><img src="spacer.gif" height="1" width="48"></td>
<td><img src="spacer.gif" height="1" width="554"></td>
</tr>
<tr>
<td align="right" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; padding-left: 20pt; text-align: left;  font-style: normal; width: 36pt">&bull;&nbsp;</td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top:6pt; padding-bottom: 6pt; text-align: left; font-style: normal; width: 420pt">Age;</td>
</tr>
</table>
<table cellpadding="0" cellspacing="0" border="0" width="602">
<tr>
<td><img src="spacer.gif" height="1" width="48"></td>
<td><img src="spacer.gif" height="1" width="554"></td>
</tr>
<tr>
<td align="right" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; padding-left: 20pt; text-align: left;  font-style: normal; width: 36pt">&bull;&nbsp;</td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top:6pt; padding-bottom: 6pt; text-align: left; font-style: normal; width: 420pt">Business
and current residence addresses, as well as residence addresses for the
past 20 years;</td>
</tr>
</table>
<table cellpadding="0" cellspacing="0" border="0" width="602">
<tr>
<td><img src="spacer.gif" height="1" width="48"></td>
<td><img src="spacer.gif" height="1" width="554"></td>
</tr>
<tr>
<td align="right" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; padding-left: 20pt; text-align: left;  font-style: normal; width: 36pt">&bull;&nbsp;</td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top:6pt; padding-bottom: 6pt; text-align: left; font-style: normal; width: 420pt">Principal occupation or
employment and employment history (name and address of employer and job
title) for the past 20 years (or such shorter period as the candidate
has been in the workforce);</td>
</tr>
</table>
<table cellpadding="0" cellspacing="0" border="0" width="602">
<tr>
<td><img src="spacer.gif" height="1" width="48"></td>
<td><img src="spacer.gif" height="1" width="554"></td>
</tr>
<tr>
<td align="right" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; padding-left: 20pt; text-align: left;  font-style: normal; width: 36pt">&bull;&nbsp;</td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top:6pt; padding-bottom: 6pt; text-align: left; font-style: normal; width: 420pt">Educational
background;</td>
</tr>
</table>
<table cellpadding="0" cellspacing="0" border="0" width="602">
<tr>
<td><img src="spacer.gif" height="1" width="48"></td>
<td><img src="spacer.gif" height="1" width="554"></td>
</tr>
<tr>
<td align="right" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; padding-left: 20pt; text-align: left;  font-style: normal; width: 36pt">&bull;&nbsp;</td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top:6pt; padding-bottom: 6pt; text-align: left; font-style: normal; width: 420pt">Permission for the Company
to conduct a background investigation, including the right to obtain
education, employment and credit
information;</td>
</tr>
</table>
<table cellpadding="0" cellspacing="0" border="0" width="602">
<tr>
<td><img src="spacer.gif" height="1" width="48"></td>
<td><img src="spacer.gif" height="1" width="554"></td>
</tr>
<tr>
<td align="right" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; padding-left: 20pt; text-align: left;  font-style: normal; width: 36pt">&bull;&nbsp;</td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top:6pt; padding-bottom: 6pt; text-align: left; font-style: normal; width: 420pt">The number of shares of
common stock of the Company beneficially owned by the
candidate;</td>
</tr>
</table>
<table cellpadding="0" cellspacing="0" border="0" width="602">
<tr>
<td><img src="spacer.gif" height="1" width="48"></td>
<td><img src="spacer.gif" height="1" width="554"></td>
</tr>
<tr>
<td align="right" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; padding-left: 20pt; text-align: left;  font-style: normal; width: 36pt">&bull;&nbsp;</td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top:6pt; padding-bottom: 6pt; text-align: left; font-style: normal; width: 420pt">The information that would
be required to be disclosed by the Company about the candidate under
the rules of the SEC in a Proxy Statement soliciting proxies for the
election of such candidate as a director (which currently includes
information required by Items 401, 404 and 405 of Regulation S-K);
and</td>
</tr>
</table>
<table cellpadding="0" cellspacing="0" border="0" width="602">
<tr>
<td><img src="spacer.gif" height="1" width="48"></td>
<td><img src="spacer.gif" height="1" width="554"></td>
</tr>
<tr>
<td align="right" valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top: 6pt; padding-left: 20pt; text-align: left;  font-style: normal; width: 36pt">&bull;&nbsp;</td>
<td valign="top" style="font-family:serif;font-weight:normal;color:#000000;font-size: 10pt; padding-top:6pt; padding-bottom: 6pt; text-align: left; font-style: normal; width: 420pt">A signed consent of the nominee to
serve as a director of the Company, if
elected.</td>
</tr>
</table>
<br>
<hr width="760" style="padding-left: 0pt;" align="left">
<br>



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